Posted on: 26-06-04 08:30:58
We would like to land and return after the PR formalities are completed.
I understand the initial amount what we bring in as settlement fund, we need not pay any tax on it.
1. Do we have to bring in the full amount mentioned in our application form as settlement fund (we applied on skilled category). Is there a minimum or maximum amount that we can bring in without tax.
2. Can we bring in part now and the remaining can we bring in later, if we can bring in later, please advise within how many days/years we should bring the balance amount as settlement fund without paying tax.
3. Can we declare fixed asset (land which does not have any income) in our landing list and can be bring in this money later without paying tax on it or without paying capital gains. If so, within how many days/years we have to bring this sale proceeds.
4. What about our amount of savings accured by us during first three years after landing, can we bring in that amount without paying tax when we finally settle in Canada.
5. What about gifts received, can we bring in without paying tax.
6. Since I will be settling in Canada three years after the date of landing, do I have to file my income tax for the next financial year onwards.
Kuwaituser,
You had asked similar question in your post Banking in Canada and I had answered this.
http://www.canadiandesi.ca/read.php?TID=3530" target="_blank">http://www.canadiandesi.ca/read.php?TID=3530
WE would love to help you, but tell us what specifically you have not been able to understand in my reply so that I or someone else can be more elaborate.
Chandresh
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Chandresh
Advice is free – lessons I charge for!!
Thanks Chandreshji for your reply to my previous query. I really appreciate your efforts which is a great help to new immigrants.
But the previous query was mainly on Banking in Canada, and ofcourse we touched on the subject of transferring money mentioned in the landing papers which you said you think there is no time limit to transfer this funds provided we show it in the tax return.
I wanted to be sure if there is a time limit to transfer the funds (because I heard that within a year from the date of landing we should transfer the funds) mentioned in the landing list and also my additional queries were regarding fixed assets.
1. Can we declare fixed assets (property) in the landing paper and is there a time limit to bring the sale proceeds of the fixed asset and are we liable to pay capital gain of 20% when we bring in this fund after sale of the property.
2. Since I plan to settle in Canada only after three years, do you think I should file my tax returns from the coming financial year. As per your your previous posting I have to show the funds in the tax return if it is over 100K, but since I am not yet a resident do you think I have to file the tax return.
3. What about the amount of savings accrued during the first three years after landing. Can we bring this without paying tax or do you think we should declare this amount at the time of landing to evade tax so that we can bring it to Canada later.
4. What about cash received as gifts. Is there any limit for gifts received and do we have to pay tax on gifts received.
Thank you once again and look forward to your feeback.
Chandreshji,
I would like your advise on the following. I have also posted this on "Landing Soon".
At the time of land when we declare the value of the immoveable asset that we would like to sell and bring later, please advise if we have to give a Property Valuer's certificate showing the exact value of the immovable asset along with the copies of the sale deed or can we just mention the value without any proof of the actual immovable asset or will they insist on proof of the value of the property.
If they do not require any valuer's certificate, how do they verify if the property is not overvalued currently, as when we sell this property at a later date I understand we have to pay 20% capital gain on the difference in the value of the property we declared at the time of landing and actual amount we sell at a later date.
We can always over value the property and then show a small difference in the appreciation after two years, thereby pay less capital gains .
I would appreciate urgent feedback as I have to obtain a valuer's certificate if it is required.
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Orginally posted by kuwaituser
Thanks Chandreshji for your reply to my previous query. I really appreciate your efforts which is a great help to new immigrants.
But the previous query was mainly on Banking in Canada, and ofcourse we touched on the subject of transferring money mentioned in the landing papers which you said you think there is no time limit to transfer this funds provided we show it in the tax return.
I will try to answer your queries to the best of my knowledge, but I think I do not have specific answers to some technical aspects.
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I wanted to be sure if there is a time limit to transfer the funds (because I heard that within a year from the date of landing we should transfer the funds) mentioned in the landing list and also my additional queries were regarding fixed assets.
Now I am not sure what exactly people on this forum mean by settlement funds - is it the initial amount or the total amount one has shown on his application as the amount he will carry to Canada.
I have been here for almost 4 years, and I am still getting money from overseas - all of which I have been declaring in my tax returns every year. Infact, I will be getting a big chunk next month to pay for my house which I have just bought, and frankly, I do not forsee any problem since the assets have been declared and income on them reported each year.
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1. Can we declare fixed assets (property) in the landing paper and is there a time limit to bring the sale proceeds of the fixed asset and are we liable to pay capital gain of 20% when we bring in this fund after sale of the property.
In my opinion, and I am no expert at this, you can declare one particular value of the asset - I do not know whether or not the authorities ask for a valuation - but in case it is a big amount, I feel, they might. Since not only you can avoid being taxed on your income / capital gains on that asset during the years you still keep the money out of Canada, there are people who will be willing to pay you to bring their undeclared funds lying overseas by using your higher valuations, and thus avoiding their tax on it.
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2. Since I plan to settle in Canada only after three years, do you think I should file my tax returns from the coming financial year. As per your your previous posting I have to show the funds in the tax return if it is over 100K, but since I am not yet a resident do you think I have to file the tax return.
You have to understand that there is a difference between resident as per immigration law and resident as per tax laws. You can be a tax resident without being a immigration resident. If I were you, I would file my tax returns either way - to keep a clean record and not have any complications later. In case you are considered resident, you have to do it in any case, and in case you are non-resident, there is no harm since you will not be taxed on any of your foreign income.
According to tax rules in Canada, a person who has any ties with Canada can be considered a tax resident. Ties could mean things like house, family, even a rental accomodation in your name, bank account, and even a driving licence!!
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3. What about the amount of savings accrued during the first three years after landing. Can we bring this without paying tax or do you think we should declare this amount at the time of landing to evade tax so that we can bring it to Canada later.
I think there is a confusion here - the tax authority is not concerned how much you saved when you were away from Canada. They are concerned how much did you earn? If you were a tax resident, you will have to declare your income you earned overseas, whether you saved whole or none of it, is of no concern to CCRA (Canada Customs and Revenue Authority). If you say that you saved something in those years, you must have earned something - and that is what you are required to declare and pay taxes on. And once you have done that, whatever you have saved has become you declared and tax paid income so obviously you can bring it with you.
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4. What about cash received as gifts. Is there any limit for gifts received and do we have to pay tax on gifts received.
Gifts I think are not taxable - but you should have enough documentation to prove it, especially if they are of large monetary value. However, I am not too sure about this and you should consult a practicing tax accountant.
Hope the above helps - and in case I am wrong somewhere, hope other accountants would correct it before you take any action.
Chandresh
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Chandresh
Advice is free – lessons I charge for!!
Thanks a lot Chandreshji for all your help. Your post is very informative and this will definitely help new immigrants to take the right steps and avoid falling into problems later.
I really appreciate your advise and would like to personally thank you when I arrive in Mississauga during the 2nd half of July.
It is 5.30 pm here now and I am just packing up to leave for home and I thought of quickly posting this before I leave.
