Tax confusion re. need to pay taxes on previous US income

bakhlawa · Post by **bakhlawa** » Wed Jul 16, 2008 9:31 am

I became a Candian landed immigrant in Dec 2001 but didn't move to Canada until Aug 2004 (at which time immigration stamped a document stating I was a "Returning Resident").

Between 2001 and 2004 I worked in the US and paid taxes there, however reported nil taxes in Canada (but filed as a resident). Beginning 2005 onwards I reported to CRA taxes on income earned in Canada.

My question is: Do I have to refile my tax returns between 2001 and 2004 reporting my US income and paying the difference to CRA (if any amount outstanding)? Or can I refile returns for these years stating I was a "nonresident" and not have to pay taxes on the US income? (I was in Canada less than 183 days each of these years but did have some "residential ties" in the form of a health card that I used on a few occassions, a joint bank account with my brother, etc. - nothing major but perhaps enough to be deemed a resident).

Any help or advice would be useful.

nelsona · Post by **nelsona** » Wed Jul 16, 2008 9:47 am

Know that you completely misfiled your cdn returns for those years. Filing as a resident requires reporting WORLD income. You were clearly not resident. I suspect it was done under the misguided notion that you had to be a resident in canada once you got your papers (you did not need to do this).

I would NEVER accuse you of lying and faking your Cdn residence just to abuse your medical card (which, by the way, was invlaid until you actually moved to canada) or your Landed Immigrant status. No, Never.

But in that spirit, I'm not going to advise any further, either.

bakhlawa · Post by **bakhlawa** » Wed Jul 16, 2008 10:19 am

I realize my returns were filed incorrectly and am looking to correct the mistakes. Whether that means refiling as non-resident (if that is indeed true) or refiling to report world income for those years and paying the difference owed to CRA. Just looking for advice so that the next steps I take can make the situation right.

nelsona · Post by **nelsona** » Wed Jul 16, 2008 10:31 am

Oh goody.

First contact the Health Ministry of your province and advise them that you wish to repay any costs associated with the false claims you made in 2001-4.

This will strongly help your case in showing CRA that you were not resident.

bakhlawa · Post by **bakhlawa** » Wed Jul 16, 2008 10:46 am

I am prepared to do just that if that is indeed the right course of action. But I sense the logical option is to seek paid advice at this juncture.

Thanks for your sincere and unbiased advice.