An owner of a two-unit strata wrote to a strata advice column in April 2024 asking whether even a duplex strata has to file a tax return, and a trust return on top. The first half has a clear answer from the Canada Revenue Agency (CRA): “All corporations (including non-profit organizations, tax-exempt corporations, and inactive corporations) have to file a T2 return for every tax year, even if there is no tax payable.” A strata corporation is a corporation, so a duplex strata files a T2 every year. The trust return question is still open: CRA’s current guidance on trust returns does not mention strata corporations at all.
This post covers what a small strata files, when a second form called the T1044 applies, what the strata must keep, and where the tax rules touch your own return. Our taxes for a small strata page keeps the full list up to date.
What a small strata files, at a glance
| Filing | Who files it | When it applies to a small strata | Source |
|---|---|---|---|
| T2 corporation income tax return | The strata corporation | Every tax year, even with no tax to pay | CRA, “Who must file a T2”, modified 2026-10-19 |
| T1044 non-profit information return | The strata corporation, if it is a non-profit organization | Only if one of three tests is met (below) | CRA guide T4117 |
| T3 trust return | Not confirmed for stratas | CRA guidance does not mention strata corporations | CRA bare trust FAQ, modified 2026-10-05 |
| Your personal return | You | Strata fees are deductible only against rental income | CRA guide T4036 |
The T2: every strata, every year
CRA’s page on who must file a T2 lists only three exceptions for corporations resident in Canada: tax-exempt Crown corporations, Hutterite colonies, and corporations that were registered charities throughout the year. A strata corporation is none of those.
The Province of BC says the same thing on its budgeting page: “The strata corporation must file a tax return for each fiscal year with the Canada Revenue Agency.”
Most stratas owe no income tax, because CRA’s guide T4117 says “most residential condominium corporations qualify as non-profit organizations under paragraph 149(1)(l)” of the Income Tax Act. A non-profit organization under that paragraph is exempt from income tax. CRA adds that whether a given corporation qualifies is a question of fact in each case. The T2 is still due even when the answer is zero.
What the Act says about keeping the return is short. Section 35(2)(j) of the Strata Property Act lists “income tax returns, if any” among the records a strata must keep, and the Regulation sets the keep time at 6 years (s.4.1(3)). The words “if any” are in the BC Act. CRA’s filing rule is federal and has no such words.
The T1044: three tests
A strata that is a non-profit organization must also file form T1044, the NPO information return, if any one of these is true (CRA guide T4117):
- It received “taxable dividends, interest, rentals, or royalties totalling more than $10,000 in the fiscal period”.
- Its total assets were “more than $200,000 at the end of the immediately preceding fiscal period”.
- It had to file an NPO information return for a previous fiscal period.
The T1044 is due “no later than six months after the end of its fiscal period”. The late-filing penalty is $25 a day, with a minimum of $100 and a maximum of $2,500 for each failure to file.
For a duplex or triplex, the $200,000 asset test is the one to watch. A strata’s assets include the money it holds, and every strata must add at least 10% of its operating budget to the reserve fund each year (Regulation s.6.1(2)). Once the strata’s total assets pass $200,000 at the end of a fiscal period, a T1044 is due for the next one, and test 3 then makes it due every year after. Our budget and contingency reserve fund guide shows how the reserve builds up.
The trust return: not settled
The April 2024 letter also asked whether a strata must file a T3 trust return. We read CRA’s page “Enhanced reporting rules for trusts and bare trusts: FAQ” (modified October 5, 2026). It does not mention strata or condominium corporations.
We found no CRA statement that says a BC strata must file a T3, and none that says it need not. Ask the accountant who prepares the strata’s T2 to give you a written answer for your strata, and keep that answer with the strata’s records.
Does the strata need an audit?
A separate letter, from February 2023, asked whether a small strata must have its books audited by an outside accountant. The Strata Property Act and Regulation mention an audit once. Section 23 lets a strata, at its own cost, copy or audit the developer’s financial records for the period before the owners took over. We found no section that requires a yearly audit of a strata’s own books.
What the Act does require is a record of the money:
- books of account showing money received and spent, and the reason for each (s.35(1)(d))
- bank statements, cancelled cheques and certificates of deposit (s.35(2)(l))
- a budget and a financial statement every year (s.103)
All are kept for at least 6 years (Regulation s.4.1(3)). Those records are what an accountant needs to prepare the T2, and what CRA can ask to see. Our forms and records guide lists every record and its keep time.
A strata may still choose an audit or a review. Owners can approve the cost in the budget by majority vote.
Your own return: strata fees and rental income
The strata’s return and yours are separate. On your own return, the question is whether you can deduct your strata fees.
On a unit you rent out, yes. CRA’s rental income guide (T4036, modified March 27, 2026) says: “You can also deduct condominium fees that represent your share of the upkeep, repairs, maintenance, and other current expenses of the common property.”
On the unit you live in, no. The Income Tax Act bars deducting “personal or living expenses” (paragraph 18(1)(h)). If you rent out part of the home you live in, CRA lets you deduct only the share of the fees that relates to the rented part.
We did not find CRA text on how a special levy for major work is treated on a rental owner’s return, so check that with your accountant.
A simple yearly tax calendar for a small strata
| When | Task |
|---|---|
| Fiscal year end | Close the books, file the bank statements |
| Within 8 weeks after year end | Update the financial statement to the year end (Regulation s.6.7(2)) |
| Before the AGM | Send the budget and financial statement with the meeting notice (s.103(2)) |
| Within 6 months after year end | File the T1044, if any of the three tests applies |
| On CRA’s T2 due date | File the T2, and keep a copy for 6 years |
Pick a fiscal year end that suits your strata and keep it. A strata can change its fiscal year by a 3/4 vote at a general meeting (s.102), and in a two-lot strata a 3/4 vote means both owners agree. Our duplex strata guide covers the other rules that change when there are only two of you.
What to do this year
- Find out whether your strata has filed a T2 before, and find its CRA business number if it has one.
- Gather the books, bank statements and the last financial statement.
- Check the three T1044 tests against last year’s numbers.
- Ask an accountant to prepare the T2 and to answer the T3 question in writing.
- Put the cost of the accountant in the next budget, so it is approved in advance.
Our page on taxes for a small strata lists the questions to take to your accountant.
We are building the StraPlex app for owners of 2 to 6 unit stratas, with the budget, the reserve fund and the records in one place. The waitlist is below.
David Babakaiff, Co-Founder, VanPlex | PlexRank™ | Profit with Multiplex
