Factual Resident of Quebec or Deemed Resident of Canada

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blitzloper
Posts: 18
Joined: Sun Mar 29, 2009 11:21 am

Factual Resident of Quebec or Deemed Resident of Canada

Post by blitzloper »

Hi,

I'm a Federal Public Servant posted abroad. I last lived in Canada in 2009, and my last province of residence was Quebec.

In 2009 I filed as a factual resident of Quebec. I intended to return to Quebec.

In 2010, I wish to file as a Deemed Resident of Canada (not Quebec). I no longer intend to return to the province and some of my ties have changed.

I've reviewed the residential ties information from the CRA and Revenu Quebec, but I'm still confused.

HOME: I have no house.

SPOUSE / DEPENDANTS: I have neither.

PERSONAL PROPERTY and SOCIAL TIES: I have parents in Ontario, no social ties in Quebec. I have a vehicle and some furniture which is stored in Quebec. In 2010, I de-activated the registration of the car (it's in storage). As a public servant, I do not have a choice on where my effects are stored (Ontario versus Quebec).

OTHER: I have an active Quebec driver's licence. My health card expired in 2010 and I did not renew it. One of five bank accounts is in Quebec. I was in Canada for five days in 2010, only in Ontario, no time in Quebec.

Common sense tells me I should be free and clear. The tax savings are substantial. At the same time, I do have personal effects and a driver's license there. Any advice on this one?
nelsona
Posts: 18680
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

You were a deemed resident of canada and quebec from the moment you were posted abroad. None of the ties you mention made you a factual resident of canada or Quebec. Besides, ties are not that important, since you are a deemed resident regardless. Desire to return to Canada or not does not really matter anyways.

Unfortunately, the fact that you left Canada from QC means that you are also considered deemed resident of QC, and there is nothing you can do about this.

So, you should amend your 2009 Cdn return as such, and you should contact MRQ to find out if they will grant relief from QC taxation. QC will treat differntly those who or in service of QC rather than in service of Canada, so check with them.

This is not a dire situation, since, if by virtue of being a deemed QC resident you are required to pay QC income tax, then you are not required to pay the federal surtax for deemed residents on your federal return.

So, from 2009 on, you will pay Fed tax and EITHER QC tax, or fed surchare tax, depending on whet MRQ tells you.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best
blitzloper
Posts: 18
Joined: Sun Mar 29, 2009 11:21 am

Post by blitzloper »

I'll pay the Federal tax and either the QC Tax or Federal Surcharge Tax. Got it.

But do I really have to ask MRQ to make a determination? I would like to self-assess if possible.

Also, intent does appear to matter is past interpretations of residency:
http://www2.publicationsduquebec.gouv.q ... R1BULB.pdf
nelsona
Posts: 18680
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

The relevant reg for QC is 96R1 of law M-31

It would appear that, as I said earlier, QC will grant relief from taxation for Cdn foreign servants. I'm not 100% sure that this applies to all income, or if it excludes, for example, QC real estate, etc.

Check with MRQ.

It looks like you should not have any QC tax to pay after you left canada.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best
blitzloper
Posts: 18
Joined: Sun Mar 29, 2009 11:21 am

Post by blitzloper »

Nice! Thanks for this. I honestly don't know how you could possibly know all of this, but I'm happy!
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