TAX question

[MRFTA]

Folks,

I have a very important question and need your help in this matter.
I am working here On a TN visa and my wife has a TD visa for last 3 years.
Do I have to file the Canadian tax return. If yes, then what will be my Income.
If NO then, do I break any laws by not filling a TAX in Canada.
Do my children are eligible for CCTB even though they were born in th US.

 

[nelsona]

Do you live in US or canada? If US, then you do not report any non-Cdn income in canada. You should have filed a departure return in the year you left, and stopped recieving any government handouts. Then you have nothing more to file in canada until you move back.

But if you did not file correctly in 2004, that is not that big a problem. you might want to look at the CRA website for "Emigrant" guide, to make sure you are following all that you should. the most you might have to do is correct your 2004 return.

Neither you or kids are entitled to Cdn govt handouts while not living in canada.

 

[MRFTA]

Nelson, thanks for your quick response.
I am working and living in US on a TN. My wife and children are also living with me.
Some one told me that I should always file a tax return on the Canada side as well and just show in my return that I am earning 5000-7000 a year in Canada as well. I made that mistake last year.
How can I correct this and justify. I am feeling bad for being so ignorant.

Thanks

 

[TheRealCanadian]

Some one told me that I should always file a tax return on the Canada side as well and just show in my return that I am earning 5000-7000 a year in Canada as well. I made that mistake last year.

They suggested you file a false tax return?? Who is this idiot?

 

[TNDV2008]

Similar question

...Who is this idiot?..

I am in similar waters, different boat...

I started working on TN on NOV 2004, so, naturally, I filed Canadian taxes.

for 2005 & 2006 till now, I have been working in US, so I thought I dont need to file Canadian taxes, as per tax agreements, I have spent more than 180 days in the US.

GUESS WHAT....today, I recieved a letter from CRA saying..."Our records indicate that you have not filed an income tax return for taxation year 2006 (T1 Return). We request that you complete a return and mai it to International Tax Services Office"

"You must file a tax return if...
a) blah...
b) blah...
c) blah...
d) we send you a request to file a return
..."

I am thinking ..."what the fcuk!..."

anyone been through this crap?????

 

[nelsona]

This is not a tax forum, so I suggest serbinski.com for best info ... from me.

But, if you had cdn real estate income or wgaes in 2006, you would still have to file a return in canada for that year.

The problem is likely that you did not correctly file in 2004, indicating that you had left canada. You should have put a departure date, and not reported any US income past that date.

If you made no Cdn income in 2006, then simply write a note to them saying so, do NOT file a '0' tax return, since this would not be true. You need to clearly tell them that you are non-resident since nov 2004.

It's not always a matter of days spent in or out of canada. Cdn income still has to be reported in canada (and US if living there)

 

[TNDV2008]

dang!!

But, if you had cdn real estate income or wgaes in 2006, you would still have to file a return in canada for that year.

I had ZERO income from canada, dont have assets (just debts i.e student loan)

The problem is likely that you did not correctly file in 2004, indicating that you had left canada. You should have put a departure date, and not reported any US income past that date.

Funny you should mention that, my 2004 taxes were done by PriceWaterHouseCoppers tax specialist (as per company's relocation benefits) since I was a partial year "expatriate" into the US. With all that money they charged the company, you would think they would get it right.

If you made no Cdn income in 2006, then simply write a note to them saying so, do NOT file a '0' tax return, since this would not be true. You need to clearly tell them that you are non-resident since nov 2004..

This I will do...thank you Sir!

It's not always a matter of days spent in or out of canada. Cdn income still has to be reported in canada (and US if living there)

Funny, I thought there was an international tax treaty (agreements), which determine country of taxation on a logical process....to avoid double taxation.

Good thing I still have the emails from the tax support group...I will definately look into this.

 

[Karsan]

One thing that made things a little easier in terms of bank account interest, is that was to make sure that all bank accounts were set up with an NR4 so that any interest would be taxed properly and sent back to Revenue Canada. That way you don't have to file an income tax return just for interest (if that's the only income you are receiving in Canada). If the bank screws up and doesn't collect the interest, you will have to file a tax return and remit the interest (this is what happened to us once at BMO screwed up, again.)

My husband bought a book called The Border Guide by Robert Keats (CFP, RFP, MSFP). He has found it useful when trying to figure out various aspects of living down here and what he had/has to do in terms of Canada, taxes etc.

 

[nelsona]

Actually, you are NOT supposed to file a tax return to report this interst. the correct method of paying the interest which was not withheld (and yes, informing the bank so that they do it properly is the correct way), is to write a letter, indicating the interest, and sending a check for 10%.

Filing a return, since you are not reporting any othr income, is frought with dangers and misinterpretation from CRA. Besides, you might mistakenly think that you are entitled to deductions -- you aren't -- to reduce the proper tax.

It's 10%, flat.

 

[Byteless]

It's 10%, flat.

I think the NR tax rate is flat 25%. Isn't it?

 

[nelsona]

Cdn NR tax on interest is 10% for US residents. That is what we are talking about here.

BTW, the NR tax for interest for US residents will be disappearing shortly, when the new treaty is approved.