Dual Citizenship, Dual Taxation?

heavygargoyle · Post by **heavygargoyle** » Tue Oct 25, 2011 2:19 pm

If I have dual citizenship and live mostly in the USA, do I have to pay taxes to the Canadian government? How about vice versa?

tsanaha · Post by **tsanaha** » Tue Oct 25, 2011 2:59 pm

US tax on US person, and US citizen is always US person no matter where he/she lives.

Canada tax on residents. So you only pay US tax if you live in US.

Vice Versa, is a totally different story. If you live in Canada because you are US citizen, you have to file US return (may not pay any tax at all), also you have to file all related form as if you lived in US.

heavygargoyle · Post by **heavygargoyle** » Tue Oct 25, 2011 3:02 pm

Why would you say "may not pay tax at all"?

Filing taxes is easy, it's actually paying that I am concerned about.

tsanaha · Post by **tsanaha** » Tue Oct 25, 2011 3:15 pm

if you pay tax in Canada, you can claim tax credit in US.

nelsona · Post by **nelsona** » Tue Oct 25, 2011 4:15 pm

If you live in US, you are only liable for tax on Cdn-source income, at most, regardless of citizenship. Some income, like Cdn bank interest, is not taxed at all, some is flat taxed with no return filed. Some requires the filing of a return and calculation of tax -- all credited on your US tax return.

It is US citizens that are taxed on ALL sources of income regardless of residence, but they avail themselves of various deductions, credits an exemptions (especially the foreign tax credit and the foreign earned income exemption) which in the vast majority of cases wipes out any US tax liability for Cdn residents.

nelsona · Post by **nelsona** » Tue Oct 25, 2011 4:16 pm

And in truth gargoyle, it is the reverse of your statement:
Paying the tax (or not) is the easy part. OFten the reporting is the nightmare, as tsanaha will attest.

tsanaha · Post by **tsanaha** » Tue Oct 25, 2011 4:40 pm

totally agree with nelsona,

reporting is the key.. if you report, but you forgot to pay tax -- and it is no crime. if you don't report, even if you pay foregin tax (higher than US), it is a crime.

just make sure report --- all kinds forms...

heavygargoyle · Post by **heavygargoyle** » Wed Oct 26, 2011 5:53 am

Ok seriously, I have an accountant and a tax lawyer that will file for me regardless of whether I am in the country, I don't see the problem.

nelsona · Post by **nelsona** » Wed Oct 26, 2011 9:02 am

So... why are you here then. Ask them your questions.

heavygargoyle · Post by **heavygargoyle** » Wed Oct 26, 2011 9:10 am

ok obviously that would cost money, I'm just trying to reduce overall costs

JGCA · Post by **JGCA** » Thu Oct 27, 2011 11:05 am

Good point, I believe this forum is here to help everyone tehn they have a very good idea of what to ask their advisors, so now you know.