US citizen working for two months in Canada

jrfriedman · Post by **jrfriedman** » Sat Apr 06, 2013 3:01 pm

I am a College Professor who spent two months working at U. Waterloo last summer as a visiting scientist.

I've been trying to do my Canadian taxes online using ufile. It asks me for all of my income from the US and appears to tax me on all of it. Â It seems crazy that I should pay Canadian tax on income I earned for the whole year in the US when I only spent two months in Canada. When it calculates my tax, it's almost all the money I earned from those two months of work. Â I can't seem to figure out how to finesse the software.

What's the right procedure for dealing with this?

nelsona · Post by **nelsona** » Mon Apr 08, 2013 10:24 am

You must -- in the setup of your return -- mention taht you are non-resident. Then you will only report Cdn income.

jrfriedman · Post by **jrfriedman** » Mon Apr 08, 2013 11:36 am

That's what I did. But it asks me for my "Foreign Income". Do I simply leave this blank, even though I earned income in the US?

Thanks for your help!

nelsona · Post by **nelsona** » Mon Apr 08, 2013 11:59 am

If it is asking for foreign income, it would be doing so on a specifc line, otherwise it is not taxable income. The only time it asks for foreign incponme, is to determine whether or not you get any deductions. You don't.

You'd need to say what line it is putting this so-called foreign income on your return.

nelsona · Post by **nelsona** » Mon Apr 08, 2013 12:00 pm

make sure you have not ticked anuy other set-up like 217 election, or departing resident, etc.

I've had no problems in 12 years filing NR returns using ufile.

jrfriedman · Post by **jrfriedman** » Mon Apr 08, 2013 1:05 pm

My foreign income appears on line 104 Other Employment Income.

nelsona · Post by **nelsona** » Mon Apr 08, 2013 2:09 pm

You should not report this. You are non-resident.

nelsona · Post by **nelsona** » Mon Apr 08, 2013 2:09 pm

Besides, that would onlyt be wages. you have otehr income.

jrfriedman · Post by **jrfriedman** » Mon Apr 08, 2013 2:37 pm

Thanks. That's very helpful.

Is there any of my foreign income (investment, bank interest) that I should report as a nonresident?

jrfriedman · Post by **jrfriedman** » Mon Apr 08, 2013 9:04 pm

ok, here's where I'm stuck. On the CRA's website for non-residents (http://www.cra-arc.gc.ca/E/pub/tg/t4058 ... l#P83_5491), it says

"If you are reporting income from employment in Canada or from a business that had a permanent establishment in Canada, enter on this line the name of the province or territory where you earned the income."

The only way I can seem to get ufile to do this, is to select Ontario as my province in the Identification screen. If I don't do this, it does not calculate any provincial tax, which can't be right. Is this what I should be doing??

Later on the same page, it says "You have to complete Schedule A to report your world income. " Ufile doesn't seem to ask me about my world income, except the questions about foreign income, which end up on line 104 and get taxed. Should I complete Schedule A by hand??

JGCA · Post by **JGCA** » Tue Apr 09, 2013 9:28 am

You are filing as a non resident there is no provincial tax you have to pay a federal surtax in place of the provincial tax so as a non resident there should not be provincial tax

jrfriedman · Post by **jrfriedman** » Tue Apr 09, 2013 9:44 am

I am so confused. The CRA's website for non-residents (referenced above) says

"If you are reporting income from employment in Canada or from a business that had a permanent establishment in Canada, you will pay federal tax on that income plus tax to the province or territory where you earned the income."

This seems to apply to me, as I was an employee of a Canadian University. So, how do I pay the province's tax if I file as a nonresident?

nelsona · Post by **nelsona** » Tue Apr 09, 2013 10:27 am

Yes, you are correct. When you have wages only, then you pay provincial tax rather than the surcharge.

JG is havinga tough week.