Incorrect T4 Withholding

This is our main tax information forum which deals with topics concerning Canadians living and working in the U.S., U.S. citizens contemplating working in Canada, and all aspects of Canadian and U.S. income tax and related adminstrative issues.

Moderator: Mark T Serbinski CA CPA

Post Reply
overthehill
Posts: 13
Joined: Thu Feb 18, 2021 2:09 pm

Incorrect T4 Withholding

Post by overthehill »

Hello,

I left Canada to move to the US about 8 years ago and became a non-resident. In 2022, I received some surprise retroactive pay in Canada from a government job I used to have due to errors with their pay system.

Even though I have notified them that I left Canada, they withheld income tax as if I was resident on a T4. The income was about C$10k and they withheld around 15 percent. It should have been Part XIII withholding, probably at 25 percent. The Gov't pay system is totally hopeless and it's unlikely they'll revise anything.

My question... Can I ask the CRA to transfer the T4 withholdings to partly cover my Part XIII liability?
nelsona
Posts: 17951
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Incorrect T4 Withholding

Post by nelsona »

The income is considered to be Cdn-sourced, so withholding was proper.

You simply need to file a tax return (for the province you worked in to get the money back. In fact, if it was less than $10K CAD , it is exempt by treaty.

What other Cdn income are you being taxed on?
nelsona non grata. Non pro. Search previous posts. Happy Browsing :D
I will be taking may usual break until MAY. In the meantime, please direct your questions to ND.
overthehill
Posts: 13
Joined: Thu Feb 18, 2021 2:09 pm

Re: Incorrect T4 Withholding

Post by overthehill »

Oh wow, I didn’t realize that.

I don’t have any other Canadian source income at all. My reference to Part XIII liabilities was only because I thought this income was subject to Part XIII.
nelsona
Posts: 17951
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: Incorrect T4 Withholding

Post by nelsona »

So file the return for your province reporting only that income.
nelsona non grata. Non pro. Search previous posts. Happy Browsing :D
I will be taking may usual break until MAY. In the meantime, please direct your questions to ND.
overthehill
Posts: 13
Joined: Thu Feb 18, 2021 2:09 pm

Re: Incorrect T4 Withholding

Post by overthehill »

Thanks a lot! I will do that.
Post Reply