Posted on: 10-11-07 10:51:24
Dear friends,
I would like to know certain things regarding the tax applicable for PR at different stages. If you could help / guide me in my specific queries it would be highly appreciated.
Previously I have raised this topic and some have replied too (Thanks to them 
) , honestly speaking after referring to the websites suggested like CRA and other I got lost and confused probably its very detailed, so I am putting this here again. Appreciate if seniors, experts and professional people on this forum can put their piece of advice and guidance in simple to understand way in a layman’s language which will help people like me and others also. I would appreciate if Pramod Chopra, DP Jain and Chandresh like people can also put across their points as I know for sure they should be having immense knowledge on this, so far based on their messages here.
My plan is to do the initial landing (Apr-May 2008), get to know the place, complete my basic things like applying for PR card & SIN card and also gather as much information and know Canada firsthand as much as practically possible (In a months time) and return. Later would come back permanently to Canada within a year.
As far I know, as a PR whatever amount or Networth one declares at the initial landing will remain non taxable and can bring the same into Canada anytime later or at initial landing time itself.
My questions are
1) How much tax (in percentage) I need to pay from the income I make outside Canada after doing my initial landing and bring in the same to Canada at later stage.
2) If I open a bank account how much tax I will need to pay even If I just maintain basic amount required to maintain an account
3) If I do not open a bank account and only apply for SIN which is required to apply for jobs, how much tax I will have to pay (or not?).
Dear mapledreams,
Your questions are valid. Also, you know the answers. Since you asked for an answer, I will give you the correct ones. But you must always consult the local taxation office and they will also reply to you on their letterhead and you can quote those answers to us here, with authority, after that. As we say here, you heard it straight from the Horse's Mouth and you have the proof in writing. But they can change the rules from time to time.
ITEM
1) What ever money that you made or making outside Canada, BEFORE you become a PR and BEFORE you come here to Canada, to settle down permanently, is NOT Taxable in Canada. Aren't you lucky?!
What percentage?? If you mean MY share? AH. I will let you go free this time, since you are such a nice Gentleman.
2) The minute you Open a Bank Account, you have to provide them with a place of Residence, a Social Insurance Number, your Passport Number and a lot of other identities with pictures in it and you also give them a phone number where you can be reached too. It tantamounts to your slipping a NOOSE around YOUR OWN neck. I will explain the same to you here. If I am using a ten dollar word and you do not understand it, then, it is tough luck.
A few years ago the Banks did not send a report to anyone on the money that they made as interest, upto a sum of fifty dollars. Then the tax man got a little smarter and now even the first penny attracts tax. A cpoy of that report goes to the tax department and you get a slip from the bank telling you that you have to report that income in your tax return and that makes you a TAXABLE CANADIAN. This report from the Bank give them an address where YOU reside. Now you have to pay taxes on the GLOBAL income, even though you did not work here for a day, nor did you get any benefits here in Canada. Now your name is in their DATA BASE and they know how to reach you. Even if they can't, if you ever return here and work, they will write a very nice letter to you after you return and tell you to cough up the tax money you owe OR Else? Or else what? you want to know? Right? It is a game called "GOTCHA"!
They put you in a room with steel bars and you will be behind them and they provide you with three meals a day. Hey that is luxury! Yes!
Only thing is you won't see the sunlight for a good while. Thats baaaaad.
Ah so....
So, if you do not open the Bank account after getting your PR CARD, you are a free bird, to go and work anywhere in any part of the world and return back to Canada after an year and still NOT pay any taxes on the earnings you made after receiving the PR Card. Boy o boy aren't you lucky again?!
That is why we tell you NOT TO OPEN a BANK ACCOUNT.
3) Are you talking about working here in Canada or OUTSIDE of Canada? If you work here in Canada, then, you are a Canadian Resident and you become a TAXABLE CANADIAN, just like all of the Canuks, except the diplomatic core and a few others... like the Airline staff and the Shippies etc.. Now your luck runs out. No more tax breaks.
SIN or the Social Insurance Number, is a PERMANENT number that links you with the Government. { The Immigration, The Police, The Customs, The Tax Department, The Canada Pension, The Old Age Security, The Banks, The Credit Bureau, The FBI, The Interpol, The CIA, The Scotland Yard, The ETA.....Your Passport from India Etc.,} A few do get a temporary one too. But once you are Empolyed and become a Permanent Resident, though the number is linked to YOU, it does not provide them with a Permanent Residential Address, till you provide them with one through your employer, here in Canada. So, it is upto you to do what is necessary and I don't see any advantage of having a SIN card, if you do not want to stay after you recveive the PR CARD. Now why you want to pay any taxes? Who is asking for it anyway?
Did I cover all of the bases and the scenerios?
Freddie.
Freddie,
You have answered my questions very well. Thanks a lot. Now this leads me to below queries
1) In this case, is it advisible to declare only the minimum amount required to land as proof of funds at the initial landing? (Pros & Cons of such limited declaration)
2) How should I declare the total funds which I will bring in after 1 year when I will be returning permenently. I can only prove (with proof) of other funds / the networth I hold at the time of initial landing and not the networth (gained during next one year) which I will have 1 year later which I intent to bring with me to Canada?.
Mapledreams
mapledreams,
You know how rich you are and in what form these tangible assets are. So, take a proper inventory of all of it (them). Make a list if you can. IF you can, do include the current value of it (them). IF possible with proof, JUST FOR YOUR RECORDS. These are your assets.
Be truthful and declare your holdings whenever they ask you for it. What they want from you as a minimum requirement, is for you to show it to them, which will get you by here in this new country and help you in your day to day affairs, which is, at the time of landing. I am sure that they don't even ask you about it.
Hey, you want to know something? They know all about you and your financial affairs too. That is all I can say. It is all 'pro'. No 'con'.
Also, you can have a Bank account any where in any part of the world. This is a free country. So, don't feel bad or guilty having a bank account in any other part of the world, I mean other than in India.
Net worth can change from day to day. So, whatever proof you have prior to landing is sufficient for you and them. You can show in the amounts to follow column, or, in the location it asks you for it to satisfy their requirements and your mental peace. You can bring the same through the Normal Banking Channels, any time you so desire or keep it away as long as you want to. There is no hard and fast rule. They only want TAXES on the GAINS you make, AFTER you become a TAXABLE CANADIAN. Isn't that nice? Until then, you are scott free.
You should consult all of these with the Canadian Government too. I want to see them sweat a little bit, trying to answer your questions, in their legal lingo. (language)
Freddie.
Freddie,
So in summary what I understand from all the above is ,
1) If I just get my PR card and come back w/o taking SIN, opening bank account etc, I remain non taxable till I return permanently (In my case 1 year time frame).
BUT
2) I can / should only show funds which I have proof and mention the same in the funds to follow list/column. So whatever fund I bring in
to Canada after initial landing apart to the funds with proof which I mentioned in initial landing time would automaticaly become taxable. Is this understanding right?
Mapledreams
Quote:
Originally posted by mapledreams
2) I can / should only show funds which I have proof and mention the same in the funds to follow list/column. So whatever fund I bring in
to Canada after initial landing apart to the funds with proof which I mentioned in initial landing time would automaticaly become taxable. Is this understanding right?
Mapledreams
http://www.canadiandesi.com/read.php?TID=14833&page=1
- Erra
Quote:
Originally posted by mapledreams
Freddie,
So in summary what I understand from all of the above is ,
1) If I just get my PR card and come back w/o taking SIN, opening a bank account etc, I remain non taxable till I return permanently (In my case 1 year time frame).
BUT
2) I can / should only show funds which I have proof and mention the same in the funds to follow list/column. So whatever fund I bring in
to Canada after initial landing apart to the funds with proof which I mentioned in initial landing time would automaticaly become taxable. Is this understanding right?
Mapledreams
__________________________________________________________
Maple dreams,
1) "When you enter Canada, please tell them that you have come here to settle down, and for GOOD". Get your PR card. Now you have a change of plan after the receipt of the PR Card.
You are not the only one who has returned back to a place where they have a steady job, another home, a Factory to run, or a Business to Manage and iron out things. So, go back and do your thing and return. As long as you fill in TWO full years plus a day out of FIVE. You can renew your PR Card.
Then, if you want to renew the PR Card once again, DO IT. Till one fine day you decide to take up the Canadian Citizenship.
Your understanding is correct.
Don't loose track of time after that. Now, the days are getting numbered. So, be careful and return well in advance and establish yourself here. Get a Job, and get all of the things, such as SIN Card, Health (OHIP, if in Ontario) Card, A Driver's licence, a credit Card etc., here in Canada after your arrival. (The Second Time)
2) Many people have different kinds of assets. Some with land holdings, some with rentals, some with Fixed Deposits (GIC's), some hold antique cars, (All the old cars in India are Antiques), Paintings, Stamp collections etc., and the value of these change from year to year. No one liquidates everyting all at once, unless they are moving for GOOD, lock stock and Barrel. Even then they retain a large selection for their personal enjoyment. They don't have to look back, after that.
If you can get these appraised prior to your departure and on a date closest to arrival here 'for settling down', it will provide you with the valuation closest to the date it is considered - 'Deemmed to have been disposed off'. {'SOLD or Liquidated"}. This will be accepted by the Tax department when you make Capital Gains or Losses. Gains they will allow, Losses is a ball of wool of another colour.! I don't want to open another Pandora's Box.
Therefore, you liquidate and deposit a sum with a Bank and obtain a statement, giving you in a letter form, quoting that such and such sum Rs.654321/= or $15,000.00, is available to Mr.M, i.e. you, in his account number 123456... with us, at a city and a location and he has maintained and managed his account well, in an exemplary manner. Make it preferably as close to the date of travel out of a location, where ever you are departing from, to a the Port Of Entry.
The Proof of funds is the minimum amount that they anticipate on you, for your use here, for your day to day existance. But you are free to declare any and all of the monies with you, if you so desire. There is no harm.
{As it currently stands, PLEASE do not bring any more than a sum of Canadian $9999.00 in cash, certified cheque, or travellers cheques etc., (that means a total of, including all of the currencies that you can put together on you at the time of decalaration. Anything less, it is O.K. All of this is a CAP that they have placed, currently, due to the money laundering act.}
Either your understanding or the writing to this board is not correct.
THERE ARE NO TAXES ON ANY MONIES THAT YOU BRING INTO CANADA. Repeat, NO TAXES. After you land and become a settlor, if and when your assets make 'Gains', 'THE GAINS' are taxed according to the class that they fall in. (Such as: Capital Gains or Interest, or Dividends etc., which you will come to know after you make some money and start filing the Income Tax Returns.) You can learn the same after you settle down here.
That's a scoop full.
Freddie.
