Being a deemed non-resident for canadian Tax purposes

depends where you are. In smaller cities and towns they may not be so eager to help out a foreigner. Or even know how.

Read this: http://www.cra-arc.gc.ca/E/pub/tg/p151/README.html

If you're unsure if you've cut all ties, have a read of Form NR-73.

Credit cards in the US aren't that hard, just get a secured credit card to begin with, or get an Amex in Canada and transfer it to a US one.

However the point I'd make is that it's not entirely wise to cease being a tax resident of Canada if your stay in the US is temporary, have a look at the discussion at: http://www.canuckabroad.com/forums/rrif ... t3797.html

Also, I'd just point out here that what the CRA think is somewhat academic, because it ends up in court if you disagree with them. Case law is that almost any tie makes you resident for tax purposes, the case I remember was the guy who had only an unexpired Ontario DL and some furniture in storage and the tax court ruled he was a resident of Canada for tax purposes, and he had to pay back taxes on all his income while he had been outside Canada.

You can have property, but it must not be your principal residence. You can have a bank account, but you must have declared yourself non-resident so that Part XIII tax is withheld.

Also another tip is to state you left on 31st December as it saves filing two (or possibly three) tax returns for this tax year. Unless of course you're saving a lot of money by moving it earlier.

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Also, I'd just point out here that what the CRA think is somewhat academic, because it ends up in court if you disagree with them. Case law is that almost any tie makes you resident for tax purposes, the case I remember was the guy who had only an unexpired Ontario DL and some furniture in storage and the tax court ruled he was a resident of Canada for tax purposes, and he had to pay back taxes on all his income while he had been outside Canada.

You can have property, but it must not be your principal residence. You can have a bank account, but you must have declared yourself non-resident so that Part XIII tax is withheld.

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yes, furniture in storage is most likely a tie that makes you a tax resident of Canada for tax purposes as it is a primary tie. That might have done it, although the DL would not help. But I doubt the DL was the main reason.

Just a question here if any one can answer. I moved to US back at the end of 2005 while my wife moved over in 2006. I called CCRA about becoming non resident and they said you don't really need to fill out the form to declare it. You just need to submit your last Canadian tax form and we did that back in 2005 and 2006 respectively.

I just want to ask people in this forum whether this is ok or not? If not, is it too late for us to look for help for any tax account in Canada? Please advice.

I departed Canada to the USA in Dec 2004 on a CR-1 visa. I too called up Revenue Canada, to see what is requuired. they stated just the same--fill out your cdn income tax, and right on the first page there is a spot where you type in the date you ceased to be a Cdn resident. That simple. I closed my Cdn bank accts, except for 1, and I leave less than a $1 in it. There isa form one can fill out--NR-73e, but you dont have to, so why do extra work,lol http://www.sscga.ca/pdf/DeterminationOf ... Status.pdf

Just a question here if any one can answer. I moved to US back at the end of 2005 while my wife moved over in 2006. I called CCRA about becoming non resident and they said you don't really need to fill out the form to declare it. You just need to submit your last Canadian tax form and we did that back in 2005 and 2006 respectively.

I just want to ask people in this forum whether this is ok or not? If not, is it too late for us to look for help for any tax account in Canada? Please advice.

Well there is no form per se, you just check the box on the T1 that it was your last return and you have left the country. The trick when doing that is to say you left on 31st December otherwise the CRA will pro-rate your personal exemptions.

Also you have to be careful about departure tax, there is a form you have to file declaring what your assets were when you departed. Most people don't get hit with it as it is essentially a capital gains tax that kicks in above $50,000. Most people only have that sort of gain when they sell their house, and real estate is exempt.

You do not need to file a non-resident T1 unless you have Canadian-source income from employment or certain other sources, however simple bank interest for example is exempt from filing, but you must declare to the bank that you are non-resident so they do Part XIII withholding and do not send a T5 to the CRA. If the CRA get a T5 with your SIN on it and no T1 that will cause problems as you owe them money.

Moving your tax home to the US is generally not a good idea unless you plan on staying permanently, but it sounds as though you've already done it so you'll have to cross that bridge when you come to it. (You have to move it if you become a US permanent resident).

If you have an RRSP or other Canadian tax shelter, you must declare it on Form 8891 each year.

Also you have to be careful about departure tax, there is a form you have to file declaring what your assets were when you departed. Most people don't get hit with it as it is essentially a capital gains tax that kicks in above $50,000. Most people only have that sort of gain when they sell their house, and real estate is exempt.

You do not need to file a non-resident T1 unless you have Canadian-source income from employment or certain other sources, however simple bank interest for example is exempt from filing, but you must declare to the bank that you are non-resident so they do Part XIII withholding and do not send a T5 to the CRA. If the CRA get a T5 with your SIN on it and no T1 that will cause problems as you owe them money.

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Steve,

If someone has no real assets to declare upon departure, does one has still have to fill out any special forms other than the T1 with the departure date on it ?

The accountant only asked me to do the departing tax return...no other forms were filled out. Concerned.

thanks

If you're just the average Joe Blow with a house, a car and an RRSP as your assets then there isn't any departure tax. Tax shelters are exempt from it and so is your principal residence.

Where people usually get into trouble with it (without your last name being "Stronach") is if they have a CCPC with some money in it, because usually CCPCs start from zero so the total worth of the CCPC at the point of departure is subject to departure tax.

http://www.cra-arc.gc.ca/tx/nnrsdnts/nd ... n-eng.html

What I wrote above in the thread isn't totally accurate, it's calculated the same way as CGT.

If you're just the average Joe Blow with a house, a car and an RRSP as your assets then there isn't any departure tax. Tax shelters are exempt from it and so is your principal residence.

Where people usually get into trouble with it (without your last name being "Stronach") is if they have a CCPC with some money in it, because usually CCPCs start from zero so the total worth of the CCPC at the point of departure is subject to departure tax.

http://www.cra-arc.gc.ca/tx/nnrsdnts/nd ... n-eng.html

What I wrote above in the thread isn't totally accurate, it's calculated the same way as CGT.

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thanks. CCPC stands for ?

Canadian Controlled Private Corporation.