Canadian working in US (commuter)...
Generally I have always used my foreign tax paid against Canadian tax otherwise payable but I have been told the following:
There are two ways of using the foreign tax paid: the more advantageous one is as a credit against Canadian tax otherwise payable, the other one is as a deduction from income. The latter is called "Deduction under section 20(11)" and goes on your return on line 232.
I tried using the 2nd method mentioned and it seems to be more beneficial. Has anyone had any experience trying / using this method?
Foreign Tax Deduction under section 20(11)
Moderator: Mark T Serbinski CA CPA
That result would be very unusual. The tax credit method almost always results in lower tax. Are you taking your net US taxes from your tax returns (1040NR and State), as well as your SS and Medicare and using this in your FTC calculation?
Remember, after you offset your Canadian Federal tax on Sch 1 to the maximum, the excess can be used to offset your provincial tax. Are you using tax software to do this? Highly recommended that you do so.
Remember, after you offset your Canadian Federal tax on Sch 1 to the maximum, the excess can be used to offset your provincial tax. Are you using tax software to do this? Highly recommended that you do so.
telly has already established that she uses up all her US taxes when when preparing her Cdn return.
If that is so, I too find it difficult to immaginge how $10,000 credit works out to be less than a $10,000 deduction.
If that is so, I too find it difficult to immaginge how $10,000 credit works out to be less than a $10,000 deduction.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing 
nelsona is right, I do use up all my US tax on my Canadian return.
I'm quite new to this so it's entirely possible that I've made a mistake. I'm using ufile. I'm not sure how many people are familiar with this particular software but in the "foreign income - employment" section at the very bottom of the page, in the "limit of foreign tax credit and deduction (T2209)" section, I selected "deduction under section 20(12) and entered the amount of foreign tax paid.
I'm not sure that the above method is actually producing the results of taking the deduction rather than taking the credit though but it did produce a lower tax owing.
I'm quite new to this so it's entirely possible that I've made a mistake. I'm using ufile. I'm not sure how many people are familiar with this particular software but in the "foreign income - employment" section at the very bottom of the page, in the "limit of foreign tax credit and deduction (T2209)" section, I selected "deduction under section 20(12) and entered the amount of foreign tax paid.
I'm not sure that the above method is actually producing the results of taking the deduction rather than taking the credit though but it did produce a lower tax owing.