If you earned money from renting out a property in Canada, the Canada Revenue Agency (CRA) expects you to report it — and form T776, the Statement of Real Estate Rentals, is where you do it. This guide walks through what the T776 is, who needs to file it, how to fill it out part by part, which expenses you can deduct, and where to send it.
What is the T776?
The T776, or Statement of Real Estate Rentals, is the form you use to declare rental income and expenses to the CRA. If you own and rent real estate, or other property such as farmland, it helps you calculate your gross income, deductible expenses, and total net income or loss.
T776 only applies to income from a property where you rent space and provide basic services, such as heat, parking, lighting, and laundry. If you also provide meals, cleaning, and security to your tenants, your income may qualify as business income, which you declare using T2125.
You can also use the T4036 Rental Income guide to help you complete your T776.
Rental income vs business income
Not every landlord files the same form. The CRA treats your money as rental income when you rent out space and provide only basic services, such as heat, parking, lighting, and laundry.
If you also provide services closer to what a hotel offers — meals, cleaning, or security — the CRA may treat your money as business income. In that case you report it on form T2125 instead of the T776.
Owning a property with someone else doesn't automatically make you business partners. For tax purposes, you're usually just co-owners. You are in a partnership only if you own the property with others and run it together as a business with the intent to make a profit.
Who should fill out a T776?
Form T776 is meant for any taxpayer who receives income from a rental property. If you own real estate and generate rental income, the CRA expects you to declare it on the T776. In practice, you should complete the form if you:
Own or co-own a rental property: property owners and co-owners file a T776 for each fiscal year.
Provide only basic services: renting space along with optional services like lighting, heat, and laundry counts as rental income.
Are a co-owner or partner: if so, make sure you complete Part 2 of the form.
If you also offer meals, security, and cleaning services, your income may qualify as business income, which requires a separate form. You can also have someone else prepare the form on your behalf.
How to fill out form T776
Form T776 is organized into numbered parts, followed by lettered areas for capital cost allowance. Work through the parts that apply to you.
Part 1 – Identification: Enter your name, address, and the fiscal period. Rental years end December 31, so the "to" date is the current tax year. This part also captures your partnership percentage, a preparer's details, a tax shelter identification number, and a business number where they apply.
Tick "Yes" if this is the final year of your rental operation.
Part 2 – Details of other co-owners and partners: Complete this part if you co-own the property. You can list up to three co-owners or partners, each with their name and address, share of the net income or loss, and ownership percentage.
Part 3 – Income: Report your rental income here using either the accrual method or the cash method. List each property, the number of units, and the gross rent.
Three lines summarise your income:
Line 8141: total gross rent.
Line 8230: other income, such as premiums, leases, and sharecropping.
Line 8299: total gross rental income (8141 plus 8230).
The accrual method counts rent in the year it is due and expenses in the year you incur them, whether or not money has changed hands. The cash method counts rent when you receive it and expenses when you pay them. You can use the cash method only if your net result would be about the same either way.
If you rent by the night or week — like a cottage or a condo on a booking site — that rent still counts in your gross rents, but note the short-term portion separately on line 8140, and track its share of your expenses. Note: for 2024 onward, the CRA can deny those expenses and any capital cost allowance if the rental wasn't properly licensed or registered where it's located.
Part 4 – Expenses: Deduct the costs of earning your rental income and calculate your net rental income or loss. If part of the property is for your own use, enter the personal portion on line 9949. This part also handles the share of income given to co-owners, recaptured capital cost allowance (CCA), and terminal loss.
Areas A–F, capital cost allowance: CCA lets you deduct the cost of depreciable property, such as a building or equipment, a little each year instead of all at once. The lettered areas guide that calculation:
Area A: calculation of the CCA claim.
Area B: equipment additions during the year.
Area C: building additions during the year.
Area D: equipment dispositions during the year.
Area E: building dispositions during the year.
Area F: land additions and dispositions during the year.
Claiming CCA is optional, and it can affect your capital gains when you later sell the property, so weigh it against your longer-term plans.
What expenses can I deduct on the T776 form?
T776 is the designated slip for your real estate rental income and expenses. The CRA allows taxpayers filing this form to deduct various expenses, including:
Advertising
Interest and bank charges
Insurance
Office expenses
Management and administration fees
Professional fees
Repairs and maintenance
Property taxes
Salaries, wages and benefits
Travel
Utilities
Motor vehicle expenses
Where do I submit a T776?
File form T776 for each fiscal year, running from January 1 to December 31 unless you have a unique year based on when you rented the property. The form is available on the CRA website for online filing, or it can be created by your tax software. File it alongside your regular tax return.
