Cross Border Trust Holding

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future_canuck
Posts: 12
Joined: Wed Dec 02, 2020 2:08 am

Cross Border Trust Holding

Post by future_canuck »

I'm a US Citizen and will be moving to Canada later this summer and will become a tax resident of Canada at the time of the move.

How does Canada treat income/distributions that are held within a trust?

I am considering setting up a grantor trust, which I would have to pay taxes on in the US as the grantor of the trust, but I am curious how Canada will treat this "income" since it would not directly be my income; it would be the income of the trust.

I am looking at putting in assets that generate distributions via a schedule K-1 in the US into the trust.

Thanks
GlobalCitizen
Posts: 41
Joined: Sat Jan 03, 2015 8:58 pm

Re: Cross Border Trust Holding

Post by GlobalCitizen »

Since you are the contributor and the beneficiary, the trust will be deemed resident in Canada and will be taxed at extremely high rates. Look up 'Deemed Resident Trusts'.
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Cross Border Trust Holding

Post by nelsona »

There are ways to set up a non-resident trust and protect the income when you move to Canada. See a trust expert.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
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