US Canada Taxes

tinyblackbarn · Post by **tinyblackbarn** » Thu Feb 10, 2011 10:35 pm

Hello and thanks for the help. Here is my situation.

I hold both US and Canadian citizenship. My wife is only a US citizen. I lived in Wisconsin for the past 3 years and in July 2010, I moved back to Toronto to take a new job. My wife is living with me here in Toronto, but is a "visitor" until she gets some kind of status from her PR application. We both had income in the US in 2010.
My question is:

1. Do I need to file canadian taxes for her and/or report her income even though she has no status in Canada?

JGCA · Post by **JGCA** » Thu Feb 10, 2011 11:44 pm

Unlike the US Canada taxes you based upon residency not Citizenship. Assuming you have no income in Canada in 2010 then you could theoretically not file a CND tax return since you were not taxable, same goes for your wife she would not need to file a return. If you decided to file a tax return in Canada showing little or no income and elected to claim the GST credit thern you would be required for GST purposes to reveal your world income for you and your spouse for all of 2010 but as I said this is only for determining your eligibility for GST credit not for tax purposes.

nelsona · Post by **nelsona** » Fri Feb 11, 2011 7:41 am

Just a minor correction, if one is considered living in canada (and from what you say, both you and your spouse are), then BOTH your Cdn returns would have to include WORLD income from the date of entry (not entire year), not simply Cdn-sourced income. This would be for tax purposes, not simply for figuring GST credit.

Fot GST credit, a special form would need to be filed, see form RC151

JGCA · Post by **JGCA** » Fri Feb 11, 2011 8:36 am

Keep in mind the World income is from date of Entry not from the time you were non resident, to me this does not change anything unless you were still earning income in the US while you were in Canada from my understanding this is not the case.

nelsona · Post by **nelsona** » Fri Feb 11, 2011 9:52 am

What "understanding", JCGA? Nothing was said about what they did or did not leave behind in US.

You simply stated that Cdn income would determine Cdn taxability ("Assuming you have no income in Canada in 2010 then you could theoretically not file a CND tax return since you were not taxable"). This is not the case. WORLD income would determine this, as it does for all Cdn residents.

Your post later seemed to make a distinction between world income and "income in canada". There is no such distinction for Cdn residents.

That implication needed to be corrected.

tinyblackbarn · Post by **tinyblackbarn** » Fri Feb 11, 2011 12:32 pm

Thanks. I'm still a little stumped. So even though my wife has absolutly no status in Canada, other than visitor, (she has no Social Insurance Number, no health card, nothing), do I still have to file a Canadian tax return for her? In the event that I don't have to file for her, how do I address the question about being married. I'm using Turbotax, and when I indicate that I'm married then it wants to know all about my wife. How do I address the fact that she has no SIN. Thanks again.

nelsona · Post by **nelsona** » Fri Feb 11, 2011 1:55 pm

If she does not have an SIN, she can request an ITN using form T1621.

see:

http://www.cra-arc.gc.ca/E/pbg/tf/t1261/t1261e.pdf

Most s/w will allow you to put 000000000 for SIN in the meantime. She probably won't be filing a Cdn return, but the important thing is to put her WORLD income, and for YOU to put your date of arrival on the front page of YOUR return.

You will be filing a paper return in any case, so its not crcial that your Turbotax file be completed to the extent that you can e-file.

JGCA · Post by **JGCA** » Fri Feb 11, 2011 7:10 pm

As you know Nelsona that you do not have to file a tax return unless you are taxable, is what I meant by :"is determined by cND income" so yes she can file or she can choose not to file as long as her CND taxable income ( while she is resident in Canada) is below the threshold. The non resident part before she came to Canada is not included on Canada only amounts she receives while a resident is included, there is no need to include worls income at all for the time she was not a resident except for determining GST. This is a fact I do not see why this is disputed.

nelsona · Post by **nelsona** » Sat Feb 12, 2011 8:16 am

Your origianl post made a distinction between world income and Cdn income. You continue to make that distinction. There is no such distinction when resident in canada.

That is what needed clearing up, especially in light of the question of whether or not she is resident of canada merely because she has not filed immigration papers: she is resdient of canad for tax purposes.

JGCA · Post by **JGCA** » Sat Feb 12, 2011 10:13 am

Yes Nelsona I agree with you I am trying to point out to the readers that the time she becomes resident and only at that time she is taxed on world income in Canada for tax purposes but for GST purposes world income is considered for the entire year not just the tiome she is resident, it is a distinct difference the readers should be aware of I feel, and I agree with your statements I just wanted to specify this, I see it every time people come to Canada and assume the GST credit is claculated only on income world and domestic from time of residency but I have to tell them for GST credit purposes its for the entire year.

nelsona · Post by **nelsona** » Sat Feb 12, 2011 2:16 pm

For GST purposes, a newcomer needs to fill in an entirely different form, so the distinction between "normal" and not will become evident.

Its OK to misspeak, and to be corrected.

JGCA · Post by **JGCA** » Sat Feb 12, 2011 7:30 pm

On the tax form they ask " Do you wish to apply for the GST credit" if so check the Box, so obviously the taxpayer will need to use the tax form also along with the other form , so yes both form will be used.

nelsona · Post by **nelsona** » Sat Feb 12, 2011 8:42 pm

Why are you so hot about GST credit?

The poster has moved to canada to work, and was asking about filing his taxes, and HER taxes, not GST. He works, so is probably ineleigible for GST.

Her world income will be used for much more general purposes like spousal credit.

Get over your original error, and move on.