Canadian landlord taxes
The CRA T776 for landlords
By Steve Stavros Liadakis, Ontario landlord for 30+ years · Updated August 10, 2026
If you earn rental income in Canada, you report it to the CRA on Form T776, Statement of Real Estate Rentals, filed with your personal (T1) return. Here's what goes on it and how to keep the year organized so tax time isn't a scramble.
The short version
Canadian landlords report rental income to the CRA on Form T776, Statement of Real Estate Rentals, filed with the personal (T1) return. You report gross rents in the year received, then deduct reasonable expenses. Mortgage interest (never the principal), property taxes, insurance, utilities, repairs, and similar costs, so you're taxed on the net profit, not the gross rent. Capital costs like a new roof are deducted over time through CCA rather than all at once, and claiming CCA is optional because it can create a recapture that's taxed when you sell.
On this page
What is the T776?
The T776 is where you total your rental income and deduct the expenses of earning it, so you're taxed on the net profit, not the gross rent. You file one that covers your rental properties; a separate statement is used per property or grouped, depending on your situation.
Income you report
Gross rents received during the year, plus related amounts such as fees or recoverable costs you charged tenants. Report income in the year you receive it (most individuals use the cash-basis approach).
Expenses you can deduct
Reasonable costs of earning the rental income, including:
- Mortgage interest (not the principal portion), and other financing costs
- Property taxes, insurance, and utilities you pay
- Repairs and maintenance
- Property management and advertising for tenants
- Condo/strata fees, professional fees, and office/travel costs related to the rental
What a filled-in T776 summary looks like
A single property with two rented units, for one calendar year. Fictional amounts, grouped the way the T776 asks for them.
- Tax year
- 2026
- Property
- 58 Lakeview Cres, Toronto, ON, 2 units rented
- Your share
- 100%
| Gross rents2 units × $1,999.00 × 12 months | $47,976.00 |
| Advertisinglisting the vacant unit | $180.00 |
| Insurance | $2,140.00 |
| Interestmortgage interest only, not principal | $14,820.00 |
| Office expenses | $95.00 |
| Professional feesaccounting and legal | $650.00 |
| Repairs and maintenancefurnace service, painting, plumbing call-out | $3,410.00 |
| Property taxes | $5,275.00 |
| Utilitiesheat and water, included in the rent | $2,980.00 |
| Total expenses | $29,550.00 |
Two things to notice. Only the interest portion of the mortgage payment appears. The principal is not deductible, so a landlord who enters the full payment overstates expenses badly. And the figure above is before CCA: claiming depreciation is optional, and the section below explains why many landlords choose not to.
Current vs capital costs
A current expense keeps the property in its existing condition (fixing a leak, repainting) and is deducted in the year. A capital cost is a betterment or long-lived asset (a new roof, an addition, appliances) and is generally deducted over time through Capital Cost Allowance (CCA), not all at once. Getting the two right is one of the most common landlord tax questions.
A note on CCA (depreciation)
You can claim CCA on the building and some assets, but it's optional, and claiming it can create a "recapture" that's taxed when you sell. Many landlords weigh this with an accountant before claiming CCA on the building.
Keep good records all year
The T776 is easy when your rents and expenses are already tracked per property. Keep receipts, and separate personal from rental costs, especially if you rent out part of your home.
Frequently asked questions
What is the CRA T776 form for?
Form T776, Statement of Real Estate Rentals, is where you report rental income to the CRA, filed with your personal (T1) return. You total your rental income and deduct the expenses of earning it, so you're taxed on the net profit, not the gross rent.
When do I report rental income to the CRA?
Report rental income in the year you receive it. Most individuals use the cash-basis approach. On the CRA's T776 you report gross rents received during the year, plus related amounts such as fees or recoverable costs you charged tenants.
Can I deduct my mortgage payment on the T776?
Only the interest portion. Mortgage principal is not deductible on the CRA's T776, and a landlord who enters the full mortgage payment badly overstates their expenses.
What expenses can a landlord deduct on the T776?
On the CRA's T776 you can deduct reasonable costs of earning the rental income, including mortgage interest (not principal), property taxes, insurance, utilities you pay, repairs and maintenance, property management, advertising for tenants, condo or strata fees, professional fees, and office or travel costs related to the rental.
What is the difference between a current and a capital expense on the T776?
A current expense keeps the property in its existing condition. Fixing a leak, repainting, and is deducted in the year on the T776. A capital cost is a betterment or long-lived asset, like a new roof, an addition, or appliances, and is generally deducted over time through Capital Cost Allowance (CCA), not all at once.
Do I have to claim CCA on my rental property?
No. CCA (depreciation) is optional on the CRA's T776, and claiming it can create a recapture that's taxed when you sell. Many landlords weigh this with an accountant before claiming CCA on the building.
Make T776 season painless with Keystead
Keystead keeps a real double-entry ledger per property, produces a per-property income statement, and exports your income and categorized expenses in a T776-ready layout, so you (or your accountant) start from clean numbers instead of a shoebox of receipts.
Start a free trialThis guide is general information, not tax advice, and rules change. Confirm the current requirements with the Canada Revenue Agency or a professional accountant before filing.
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