CANADIAN INCOME TAX

[Steven]

If you've been non-resident the whole year, then basically get hold of the CRA now and tell them you're non-resident. You don't necessarily need to do anything for 2009 after that. You do need to tell the financial institutions in Canada that you are non-resident for tax purposes though so they issue you an NR4 instead of a T5.

If you have anything subject to departure tax, you may have to get that sorted out, file an adjustment with a T1161 is one way. More info at: http://www.cra-arc.gc.ca/tx/nnrsdnts/nd ... n-eng.html

Your RRSPs to some extent depend on what the tax provisions are in the country you are now resident in, because generally speaking they will not view it is a tax shelter, so for example you may be subject to whatever the local capital gains tax is from the date you acquired it. On the Canadian end Part XIII non-resident tax kicks in after you emigrate at 25% on withdrawals. There is more info on the CRA non-residents site.

You need to check the tax treaty too, I don't think there is one with Uganda.

[ortho]

Thanx for the info Steve.

I joined this Swiss company in mid October 2008. Was resident prior to this. Did my 2008 taxes as a resident cause wasn't sure how this job would work out. Well my 1 year mission has now become 2 and convinced of making a career out of it for the years to come. So I guess I plan on making it official for my 2009 taxes and onward. I have, with the company I'm working for, diplomatic status in Uganda so tax free while I'm working here. Certain conditions for Switzerland but easy enough as I don't live there (Europe seems to be much easier). Many of my colleauges only need to be out of their countries for 1 year in order to be classified non-resident.

I contacted Scotiabank to to tell them I wanted to be classified as non-resident. They informed me that if I do this, I can no longer have a credit card or line of credit with them. Savings and RRSP no problem.

Do I need to open an account in Uganda or Switzerland in order to get a credit card or are there canadian banks willing to offer credit cards for non-residents? Credit card does come in handy.

Should I still contact CRA now or just fill out the appropriate forms for 2009 taxes?

I had nothing in Canada when I left aside from my clothes so pretty sure I have nothing to declare for departure tax.

Al

[agnelson]

Unfortunately, since (a) Uganda does not have a treaty, and (b) your income is not taxed in Uganda, you will have no hope of being considered a tax resident of canada even if you divest yourself of everything you have in canada. Your RRSPs and savings, even your passport, are considered sufficient minor ties to keep you resident.

Numerous rulings have determined that one cannot give up Cdn tax residency without getting one elsewhere, which you are not.


Best move is likely to not bother fighting tax residncy, and use various other credits such as the Overseas employment tax credit.

Also, look into how CRA would tax your diplomatic income, since it is not specifically coming from the Cdn govt, it may be completely tax exempt (like IATA or UN income).

[Steven]

From the sounds of it the simplest option would be to remain resident in Canada for tax purposes. It sounds like you have the choice of moving your tax home to Switzerland but that probably isn't practical because you don't actually live there so getting a Swiss ID card and so on is impossible.

So you either no longer use your diplomatic status and form residential ties to Uganda or you remain a resident of Canada from the sounds of it. Either way you're going to have problems because there is no tax treaty in place with Uganda. So you either accept that you pay a lot of tax or have a variety of unusual and weird tax problems I'm afraid.

The fact you're in a diplomatic status makes it pretty hard to sever ties to Canada convincingly.

[agnelson]

Agree. OETC will help.