taxes witheld as nonresident

danny · Post by **danny** » Mon Jul 25, 2005 2:44 pm

hi

i know that 25% of the taxes on rental income are to be paid or withheld if one is nonresident of canada for tax purposes

i am wondering why the same % does not apply to interest income. I am in Europe and in a treaty country and because of that, my interest income in canada was taxed at 10% by the bank in Canada and i was issued NR4 documents

why is it that the 10% does not apply to rental income and a flat 25% applies ?

Carson · Post by **Carson** » Mon Jul 25, 2005 4:12 pm

You answered yourself. The TPTB ("taxation powers that be") in the two nations (Canada and your country of residence) have determined in their wisdom that reducing withholding tax on interest to 10% is conducive to investment and trade, whereas addressing rental property income is not very important. Thus, the standard 25% withholding rate applies.

Carson

danny · Post by **danny** » Tue Jul 26, 2005 6:23 am

thanks for reply Carson.