Non-Resident Bank account in Canada?

[rsibley]

I've been living in the USA (California) since last fall. I have two (regular) bank accounts in Canada - PC Financial and Etrade (now "scotiaitrade"). My understanding is that if I want to be considered a non-resident of Canada I need to make these accounts "non-resident" accounts (is this just a simple change of address?). So I phoned up these banks, and they both told me that they don't have non-resident accounts, so my only option is to close the accounts.

1) Would I be better off to move the money from those accounts to a US account, or try to get a non-resident account in Canada to put it in?

2) What is a good bank that offers non-resident accounts? I did a search and it appears Citibank might be an option? Any other suggestions?

3) In my etrade/scotiaitrade account I have some stock, so in order to close this account I'm assuming I would need to sell the stock. When I bought it I hadn't even thought of moving to the US and obviously wanted to sell it when it had increased in value, but some is positive and some is negative now. I guess I could always sell it, transfer the money to my US accounts and repurchase the stock? If I did that, it might actually be advantageous for the stock to have lost money? I'm trying to wrap my head around this .....any insight would be appreciated. Feel free to point me at existing threads that I might have missed in my search.

Thanks very much for any help,
Richard

[agnelson]

Your trading account is no longer usefiul; you cannot trade in it. You need to either transfer the stock, or sell up.

PC bank simply does not want to have non-resident bank/chequing accounts. That is their business policy. Go to a big bank and open up an account next time your in town. you can try by phone.

Btw, you are already non-resident, and should have informed them of this when you left last year. Did you file your departure return?

Please go to forums.serbinski.com if you want info on how ypu should have filed your departure tax last year. Looks like you forgot some things.

[rsibley]

Thanks for the response agnelson.

I've been reading a lot of messages in this forum as well as in the serbinski forums - trying to gather as much knowledge as possible!

I'm already a non-resident? I was under the impression that you could move to the USA for several years and return to Canada, and be a Canadian resident the entire time. (a "factual resident" ?). I thought I had seen advice in the forums that said if you are planning on returning to Canada within a couple years it might be easier to never cease being a Canadian resident - continue paying Canadian taxes. I thought that having a closer connection to Canada (maintaining ties like bank account and drivers license, etc) would result in continuing to be a Canadian resident. Am I wrong about some of these things?

I have not filed a departure return (I thought it was possible to just file this at the point in time when you decide to cut all ties with Canada). And I thought that was basically a personal decision based upon how long you intended to stay in the US, and how complex it would be to move your tax home to the US, etc.

Thanks again for the help,
Richard

[agnelson]

No, your departure is a fact (CRA uses those very words), not a matter of intent, or choice, when dealing with a treaty country. Besides, when we are talking about brokers, we are actually talking physical location. You can't trade in a Cdn brokerage while physically in US.

You are a US tax resident. Not a Cdn one. Even keeping an empty house would not make you resident. This is rules since about 2003, with clarification of "deemed non-resident" status.

It is never necessary to cut all ties to be non-resident, but your US ties have become your centre of vital interests, thus you are gone.


As you can now see, it wasn't very complex to move your tax home to US. You did it without even knowing.

[Steven]

My understanding is that if I want to be considered a non-resident of Canada I need to make these accounts "non-resident" accounts (is this just a simple change of address?). So I phoned up these banks, and they both told me that they don't have non-resident accounts, so my only option is to close the accounts.

When it comes to bank accounts and whatnot, then you must specifically tell them you're non-resident for tax purposes, a change of address doesn't cut it. But as said, it sounds like you're better off opening an account with another bank.

[rsibley]

No, your departure is a fact (CRA uses those very words), not a matter of intent, or choice, when dealing with a treaty country. Besides, when we are talking about brokers, we are actually talking physical location. You can't trade in a Cdn brokerage while physically in US.

You are a US tax resident. Not a Cdn one. Even keeping an empty house would not make you resident. This is rules since about 2003, with clarification of "deemed non-resident" status.

It is never necessary to cut all ties to be non-resident, but your US ties have become your centre of vital interests, thus you are gone.


As you can now see, it wasn't very complex to move your tax home to US. You did it without even knowing.

Ok, I'm a little confused.

In this thread: being-a-deemed-non-resident-for-canadian-tax-purposes-vt2012-8.html

Steven says: "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. ... Case law is that almost any tie makes you resident for tax purposes."

That seems to go against what agnelson is saying?? ..about remaining a canadian resident?

Steven also goes on to say: "Also another tip is to state you left on 31st December". This is what made me think that it's possible to decide when you want your departure date date to be.

Thanks again for the replies.
Richard

[agnelson]

Yeah, I think steven's view is a little off on this. CRA views suspiciuosly departure dates that are too coincidental. "Case law" has only been for those living in non-treaty countries.

I've dealt at length with this issue on serbinski. Those who have left for as little as six months and then returned have seen their period of non-residnecy recognized, since thier intent (and their action upon leaving Canada) showed that they had indeed departed Canada.

Departure date is not a matter of choice; it is dependant on the facts.

When you move, be it from one house to another or from one country to another, there is a moving date. If you leave canada, that is your departure date, and that is the date you should record on your departure return. Otherwise, what other event can you point to to say that on "this date, this happened" to make you non-resident.
Your initial statement "I've been living in the US since last fall" is the true indication of your situation.

[rsibley]

Thanks for your response agnelson.

I noticed that on the Serbinski website it states, "Generally, absences of less than 2 years are not considered sufficiently permanent to sever residential ties with Canada for tax purposes." How would this factor into it? Is that correct - because it makes it sound like if you're gone for less than 2 years than you never cease to be a Canadian resident?

And now I have a couple more questions....
1) When is a departure form supposed to be filled out and filed?
2) Do you need to file a departure if you are only on a 1 year TN work visa?
3) If the answer to (2) is no, then what if the intention was initially temporary (1 year TN work visa), but then the status was updated to a H1-B visa and the intention was more permanent?
4) What happens if you didn't file one? Can you file one retroactively?

Thanks again for all your help,
Richard