Form T776, Statement of Real Estate Rentals, is the CRA form rental property owners use to report rental income and expenses on their income tax return. Your gross rents from all units go on line 12599 of the return, and your net income or loss from line 9946 of the T776 goes on line 12600. You can deduct current expenses in full, but capital costs are claimed over time as capital cost allowance, which can't create or increase a rental loss.
If you rent out a basement suite, a condo or a holiday let, this is the form. Everything below comes from the CRA's T776 page and Guide T4036, Rental Income, and the rules are as of October 2026.
What goes where on the T776
| Line | What it's for |
|---|---|
| Part 2 | Details of other co-owners and partners |
| Line 8230 | Other income from the rental, such as related income that isn't rent |
| Line 8299 | Total gross rental income |
| Lines 8521 to 9270 | Expenses: advertising, insurance, interest and bank charges, office, professional fees, management fees, repairs and maintenance, salaries, property taxes, travel, utilities, motor vehicle and other expenses |
| Line 9949 | Personal portion of the expenses |
| Lines 9365 to 9367 | Short-term rental portion and the non-compliant amounts you can't deduct |
| Line 9369 | Net income or loss before adjustments |
| Line 9936 | Total capital cost allowance claim for the year |
| Line 9946 | Your net income or loss, carried to line 12600 of the return |
Current expenses vs capital expenses
Current expenses are recurring and give a short-term benefit, such as repairs that keep the property in the same condition as when you bought it, and you deduct them in the year. A capital expense gives a benefit that usually lasts several years, such as buying or improving the property, and you generally can't deduct it all at once. Instead you claim it over several years as capital cost allowance (CCA).
Rental buildings are often in Class 1 at 4%, and appliances and similar equipment in Class 8 at 20%. Furniture, fixtures and appliances you use in the rental can be claimed, the building can be claimed, or both.
The CCA rule that trips landlords up
You can't use CCA to create or increase a rental loss. If you own more than one rental property, you first combine the income and losses from all of them, even if the buildings are in different classes, and only then work out how much CCA you can claim. The guide's example of a landlord with three properties, two Class 1 and one Class 3, all with Class 8 appliances, shows the pooling in action.
A similar limit applies to vacant land. Interest and property taxes on land you hold for rental can only be deducted up to the rental income left after other expenses; they can't create a loss, but the unused part can be added to the cost of the land, which reduces a later capital gain.
Short-term rentals
A short-term rental is a residential property rented, or offered for rent, for less than 90 consecutive days. If it's non-compliant, because the province or municipality doesn't allow it at that location or because it lacks the required registration, licence or permit, the expenses for the non-compliant days aren't deductible. The T776 handles this through Chart A and lines 9366 and 9367, the second of which covers the CCA you can't claim.
Losses, relatives and co-owners
- Renting to someone you know for less than you'd charge a stranger means you can't claim a rental loss. Renting to a relative at the normal rate, with an expectation of profit, is fine.
- Losses aren't allowed if the arrangement is cost-sharing rather than a business set up to make a profit.
- Co-owners enter the gross income for the entire property on line 12599, not just their share, then report their share of the net result. Owning a rental with your spouse or partner usually makes you co-owners, not partners.
- You'd normally use the accrual method. The cash method is allowed only if the result would be almost the same.
One more thing worth knowing if you built or bought new: landlords who buy or build new residential housing, substantially renovate existing housing or convert a commercial property into housing may qualify for the GST/HST new residential rental property rebate. It's separate from the T776, so it's easy to miss.
How to complete the T776
- Fill in Part 1 with your details and Part 2 if there are co-owners or partners.
- List each property address and the number of units, including short-term rentals.
- Enter gross rents, splitting out short-term rental rents, and any other related income.
- Enter each expense line, then take off the personal portion and any non-compliant short-term amounts.
- Work out CCA across all rental properties, without creating or increasing a loss.
- Carry line 9946 to line 12600 of your return, and the gross rents to line 12599.
If you provide basic services only, such as heat, light, parking and laundry, it's rental income. Add cleaning, security or meals and you may be carrying on a business, which the CRA handles under the self-employed rules and Form T2125 instead. And if the rental property is outside Canada, check whether Form T1135 applies as well.
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The verdict
The T776 itself is straightforward; the judgment calls are what cost people. Get the split between current and capital expenses right, never let CCA push you into a loss, and be honest about the personal and short-term portions. Do those three things and the form takes care of the rest.
Frequently asked questions
What is Form T776?
It's the Statement of Real Estate Rentals, used to report rental income and expenses on a Canadian income tax return.
Where does T776 income go on my return?
Gross rents go on line 12599 and your net income or loss from line 9946 goes on line 12600.
Can CCA create a rental loss?
No. You can't use capital cost allowance to create or increase a rental loss.
What is a short-term rental for the T776?
A residential property rented, or offered for rent, for less than 90 consecutive days.
Can I claim a rental loss if I rent to family?
Only if you charge the same rate you'd charge other tenants and expect to make a profit.
Do co-owners split the gross rent on line 12599?
No. Co-owners enter the gross rental income for the entire property on line 12599 and then report their share of the net result.
