Posted on: 20-06-12 11:28:55
Dear All,
I am having a few queries regarding the non-resident canadian tax status(assuming I am Canadian citizen) as on the cra website it is not very clear.
1) What are the requirement to be a non-resident canadian, I should not have any debts(like mortgage,credit card etc) in Canada and will I have to return my OHIP card..?
2) What if I work in middleast and do not want to pay tax to canadian govt is that possible, same like being a non-resident indian we do not pay any taxes to Indian govt?
3)What will be the situation, if I wanted to keep my house in canada and rent it out and pay taxes on rental income minus rental expenses, is this possible?
replies for the above questions will be greatful......
Thanks
A
guys any replies...........
Quote:
Originally posted by aditya2007
guys any replies...........
For non-resident status, you have to call CRA. It is handled on case by case basis and there is no generic rule you can follow and become non-resident for tax purposes.
Quote:
Originally posted by aditya2007
Dear All,
I am having a few queries regarding the non-resident canadian tax status(assuming I am Canadian citizen) as on the cra website it is not very clear.
I think that the information on their website is quite clear. Please read here http://www.cra-arc.gc.ca/tx/nnrsdnts/ndvdls/nnrs-eng.html and you may get most of your questions answered. Please read carefully on the site and follow all the links provided on that page, especially this one http://www.cra-arc.gc.ca/E/pub/tg/t4058/t4058-e.html
Quote:
1) What are the requirement to be a non-resident canadian, I should not have any debts(like mortgage,credit card etc) in Canada and will I have to return my OHIP card..?
For you to be NON Residents for Tax Purposes, you should not have Residential Ties as explained at their website as per link provided above. If you do have any of these ties, you may be considered 'deemed resident' (see here http://www.cra-arc.gc.ca/tx/nnrsdnts/ndvdls/dmd-eng.html) and may be liable to pay taxes in Canada on your worldwide income.
Quote:
2) What if I work in middleast and do not want to pay tax to canadian govt is that possible, same like being a non-resident indian we do not pay any taxes to Indian govt?
You have to have a ruling by CRA on your Residency status by completing a form NR73 (see here http://www.cra-arc.gc.ca/E/pbg/tf/nr73/nr73-11e.pdf )
Quote:
3)What will be the situation, if I wanted to keep my house in canada and rent it out and pay taxes on rental income minus rental expenses, is this possible?
replies for the above questions will be grateful......
Thanks
A
The links provided above and getting a ruling from CRA by completing form NR73 you may be able to rent your house in Canada and still be considered Non Resident for tax purposes. You may have to pay set amount of tax on your rental income and you may have to declare your Non Resident status to your bank for all your bank accounts so that they can deduct a flat tax on any interest income.
Hopefully you will get your questions answered by reading in details at their website by following the links provided. Still if you have any questions, you may have to contact a tax professional.
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Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada
Definitely, As a non-resident of Canada, you pay tax on income you receive from sources in Canada. Because the type of tax you pay and the requirement to file an income tax return depend on the type of income you receive.
Quote:
Originally posted by jazzalbart
Definitely, As a non-resident of Canada, you pay tax on income you receive from sources in Canada. Because the type of tax you pay and the requirement to file an income tax return depend on the type of income you receive.
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Hello jazzalbart,
aditya2007 got into Canada around 2007. (Just a wild guess)
Filled in his THREE years needed to get his Canadian Citizenship.
Got his citizenship in 2010 and got his Passport in 2011 and then
went to the Middle East.
He needed an answer fast. Posted this query and did not see a response for two days and then asked 'guys any response' ??
He got his response, but did not have even a little bit of courtesy to say a thank you for a detailed response with all of the required answers by Pramod Chopra.
Now you appear on the scene and say
""Definitely, As a non-resident of Canada, you pay tax on income you receive from sources in Canada. Because the type of tax you pay and the requirement to file an income tax return depend on the type of income you receive.""
You just cannot simplify the matter with this kind of an answer. There is more to it. But you have read all of the materials and the links provided.
He has to TOTALLY BREAK ALL THE TIES with CANADA (the Canadian Government.) He can have a residence. But it cannot just be sitting there ready for him to re-enter and occupy. It should be rented out at arms length and UNTILL such time he gets his letter of TOTAL Severance from the CRA, for his request on a form NR73, he is in limbo land, and untill such time, he has to pay taxes on his whole WORLD INCOME. Now do tell me who is in a rush??
It is not the type of taxes he has to pay, it is the taxes he pays on the TYPES of INCOME he generates, from all of the sources in the world and he declares it as his World Income.
NOW, his home is sitting here in their back yard and so they are not worried at all. Because they got him by the NooNoo. (Or is it the flouch mugs and shirts)
Just work through all of the links provided, you will get to know a little bit more.
FH.
I am sorry that you didn't get a response as quick as you would have liked, but some of the posts above are pretty helpful.
Generally, if you are a resident of Canada for tax purposes, your worldwide income will be taxed, which means the income you earned in the Middle East will be taxed by Canada. As mentioned before, you would want to sever your residential ties, which are broken into primary and secondary ties. You should sever the primary ties, and as many secondary ones as possible, because the CRA looks at them on an aggregate basis.
Primary ties are things like place of dwelling and family. Secondary ties are things like OHIP and a drivers license. You should engage an accountant to look at your situation specifically to determine what ties exist.
By the way, you certainly can rent out your home while you are living elsewhere. There are special returns and slips that should/can be filed (NR4, NR6, S.216 return) which you should also ask about when you engage an accountant.
I certainly do hope that helps.
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Madan Chartered Accountant team
http://www.madanca.com" rel="nofollow">LINK
