returning to Canada and then leaving again maybe
Moderator: Mark T Serbinski CA CPA
just to confirm so i move at the end of 2010 with my personal effects and then go again to visit friends outside Canada over the holidays, I will still have to file a return (even with no income ) since I effectively became a resident as of Dec1, for instance. Is that correct ? I understand it is paperwork but can I avoid it ? thanks
In canada, you never "have to" file a return unless you owe money (or need to report certain trabsactions), so the question is not whether you need to file a return, the question is if you would be considered a tax resident of canada, and my opinion is, by bringing your personal effects into canada (no doubt under a returning resident duty tariff) absent of any othe residential ties on that date.
Since you would not be entitled to much basic standard deduction, you would need to report any income earned worldwide during, say, the month of December.
Since you would not be entitled to much basic standard deduction, you would need to report any income earned worldwide during, say, the month of December.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing
sorry, I did'nt understand your statement 'and my opinion is....'. What is your opinion ? That I would not or would be considered a tax resident by bringing in personal effects?
Is the returning resident tariff higher than for new residents ?I do not remember paying for this when I moved back to Canada from US many moon years ago.
I see your point about the filing part but what I assume is that generally one files a return even with 0 income once tax residency has been established. Of course one has to report income earned but it is unlikely in December that I will be working so..
Is the returning resident tariff higher than for new residents ?I do not remember paying for this when I moved back to Canada from US many moon years ago.
I see your point about the filing part but what I assume is that generally one files a return even with 0 income once tax residency has been established. Of course one has to report income earned but it is unlikely in December that I will be working so..
-
- Site Admin
- Posts: 611
- Joined: Tue Oct 26, 2004 8:05 pm
- Contact:
The currency issue is completely separate from tax, but could be important as well. If you move back to Canada, it is not necessary for you to move all of your invesments back. In fact, you should consider the long term trends in the currency in which you are invested vs. the Canadian dollar, and the projected trends, to determine whether you should move your assets at all.
Maintaining assets in a different currency may be advantageous to you in that your portfolio will be more diversified.. albeit perhaps more difficult to manage.
Maintaining assets in a different currency may be advantageous to you in that your portfolio will be more diversified.. albeit perhaps more difficult to manage.
Mark
currency effect
Thanks a lot Mr. Serbinski, indeed the currency effect is also something I am researching. the thing is that some countries permit non residents to have accounts for a while and some don't. So i might 'have' to move them back, however I think I should be able to hold them in Canada in the same currency as I do now. I remember having a US account when I moved back from US to Canada many moons ago. But a very good point and very rarely discussed. I am trying to hold it in the same currency until i know what the long term trends and the projected trends are. Not easy.
Remember that foreign currency is considered an "investment" in the eyes of CRA, so if your foreign currency rate goes up after you move to canada, you will be liable for cap gains when you "sell" that currency, whether that 'sale" be spending it, investing it in another instrument, or even buying something with it.
You need to know the value of all yourr assets on the day you become Cdn resident.
This too is something that is often neglected.
You need to know the value of all yourr assets on the day you become Cdn resident.
This too is something that is often neglected.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing
currency effect
I agree that is often neglected so determining value at the start of Canadian residence is key.
I guess one has to lose somewhere really so if the currency did become stronger and one 'sold' it ie converted to CAD, or whatever, then the capital gain is taxed. Another important point to note while holding currencies but I hope that the tax on the capital gain is offset somewhat by the advantages Mr Serbinski talked about in having a portfolio. And I think anyway it is better to risk the capital gain than convert right away to CAD. I am no expert on currencies but one could lose on currencies too.
thanks
I guess one has to lose somewhere really so if the currency did become stronger and one 'sold' it ie converted to CAD, or whatever, then the capital gain is taxed. Another important point to note while holding currencies but I hope that the tax on the capital gain is offset somewhat by the advantages Mr Serbinski talked about in having a portfolio. And I think anyway it is better to risk the capital gain than convert right away to CAD. I am no expert on currencies but one could lose on currencies too.
thanks
Unless you wanting to fget into currency specualtion, I would not be concerned so much with exchange fluctuation as with the cost of simply changing/transfrerring your money.
It is unlikely that in the short term your exchange gains or losses would be more than the cost of transfer/exchange.
If you need Cdn cash, bring some to canada, if you don't leave where it is unti lyou decide what you are doing.
It is unlikely that in the short term your exchange gains or losses would be more than the cost of transfer/exchange.
If you need Cdn cash, bring some to canada, if you don't leave where it is unti lyou decide what you are doing.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing
exchange rates
Well a lot of countries do not allow non resident accounts these days so the exchange rate becomes key as Mark Serbinski pointed out.
On the other hand, it may be possible to open a foreign currency account in Canada and wire the transfer in the same currency to avoid currency effects. In a colleague did this but was surprised to still see that he lost a fair sum in the transfer. So i am not sure if the wire even goes through in the same currency or there is an intervening third party bank
On the other hand, it may be possible to open a foreign currency account in Canada and wire the transfer in the same currency to avoid currency effects. In a colleague did this but was surprised to still see that he lost a fair sum in the transfer. So i am not sure if the wire even goes through in the same currency or there is an intervening third party bank