Canadian Tax Question

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Josephvarkey
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Joined: Tue Nov 30, 2004 11:05 am

Canadian Tax Question

Post by Josephvarkey » Tue Nov 30, 2004 11:06 am

I'm a Canadian citizen. I have been working in the US since March 2001. I paid my canadian taxes promptly from 1996 to 2000.I paid my taxes in the US from 2001 to 2003(will pay in 2004). I'm planning on to move back to Canada on NOV 2005. Will I have problems in Canada when I file for year 2006. Can I tell Revenue Canada that I was a deemed resident since 2001 to 2005 and I paid my taxes in the U.S? I have all documents of my US tax filings from 2001 till today. I would appreciate any feedback.

nelsona
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Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona » Tue Nov 30, 2004 12:56 pm

A better Title for your post wouldn't have gone amiss... these are <i>ALL </i> Cdn tax questions.

You should have filed a Cdn return in 2001 as a 'departing' Cdn, and you will have to file one as a 'newcomer' in 2005. For 2001-4 you are quite simply a NON-resident of Canada (presuming your immediate family, if any, was with you in US). My bet is that you filed your US return for 2000 incorrectly as well, but as you say, this was a Cdn tax question.

Your were NOT a deemed resident of anywhere, since CRA didn't make that decision, and to be 'deemed' you must meet a specific set of criteria, which is unlikley from your description.

Your 2001 and 2005 return would follow specific rules for partial year residents, which is what you were in 2001 and what you will be in 2005, even if you return to Canad on December 30th 2005.

Personally, I would go back to my 2001 return, and determine if I owed CRA any money (follow the rules outlined in the "Emigrants" guide for this year, but apply it to a 2000 return.)

At the end of 2005, you will prepare a 2005 Cdn return for your province of residence with a Nov. 2005 arrival date (That's the whole point of that quaestion on the front page of the return).

It's nice that you prmptly paid your taxes in the past, but really that is irrelevant to any other year.

<i>nelsona non grata</i>

Josephvarkey
Posts: 3
Joined: Tue Nov 30, 2004 11:05 am

Post by Josephvarkey » Tue Nov 30, 2004 2:17 pm

Thank you very much for your info.

I was unemployed during Dec 2000 to Feb 2001 in Canada. But I did file my tax return in Canada for year 2000(filed March 2001). As mentioned in your post, I should have done as a departing CDN. Someone told me, that I don't have to file Canadian taxes as I was in the US for more than 183 days during 2001 period and hence, I did not file in Canada for the year 2001. I don't think I owe any money to Revenue Canada so far. But, I'll have to check to be concise.

So when I file my taxes during Mar/Apr 2006, I will file both in Canada and the U.S

Thanks again for your reply.

nelsona
Posts: 16015
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona » Tue Nov 30, 2004 5:17 pm

You should have filed a 2001 Cdn return in spring of 2002, a year after leaveing Canada, as a departing Cdn. You likely owe tax for any UI you received, and if you had any investments at that time. You get little personal exemption for partial years.

The advice you got about 183 days was completely bogus.


In spring 2006, you will indeed have 2 returns to file. Your US "dual-status return will be similar in choices as the 2001 return -- which you likely filed incorrectly.

<i>nelsona non grata</i>

Josephvarkey
Posts: 3
Joined: Tue Nov 30, 2004 11:05 am

Post by Josephvarkey » Wed Dec 01, 2004 11:02 am

Thanks Nelsona for your information. I wish I should have taken your suggestions way back in 2001 if this forum was active then. Thanks a lot..

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