Hi
I have been on PR in Canada for 3 years with physical stay of 1095+ days already(Still to file citizenship). I got a job in US about 1.5 months back and being in IT field they allowed me to work for home by the time I wrap up here in Canada.
My home is sold and closing is end of October. So far I got 1 monthly paycheck in my US bank account. I plan to leave Canada atleast for few years in October end after filing my citizenship.
My question s are:
1) When I should acquire non resident status? As soon as I move or can I wait till Dec end?
2) When I should file my departure tax? Is it different or harsher than normal tax filing(Any penalties for leaving?). Will filing it affect my citizenship application?
3) Or simply I can be dual resident for some time?
4)Let's say I file departure tax, will I be paying taxes NOW on my US income I already got for 1 month ?If yes, how will I get tax credit for it?
5) I also have an IT Company in Canada( I was contractor), now no activity in it, Are there any plus in keeping it open?
So overall looking for most tax effective approach while keeping in mind that I will be filing my citizenship application. Any response, help ,input is highly appreciated!
Sam
moving out of Canada -help needed
Moderator: Mark T Serbinski CA CPA
1. Departure date should always coincide with some particular event, not the calendar. You become non-resident when you physically move to US
2. Departure tax merely means that CRA considers almost everything you ahve as sold on the day you left. It is not a penalty, it is merely paying what you owe now, and then being free from that forever. See the Emigrants guide from CRA. You should be selling off any non-RRSP investments you hold anyways, since you need to move these out of canada.
3. No. You live in one place at a time.
4. Becuase you chose to remain in canada, you pay Cdn taxes on all your income until the day you leave. You pay US tax on the US income, and take credit for the tax on your dpearture return.
5. You should be winding this down, since it loses its CCPC status anywys, and is unnecesary.
2. Departure tax merely means that CRA considers almost everything you ahve as sold on the day you left. It is not a penalty, it is merely paying what you owe now, and then being free from that forever. See the Emigrants guide from CRA. You should be selling off any non-RRSP investments you hold anyways, since you need to move these out of canada.
3. No. You live in one place at a time.
4. Becuase you chose to remain in canada, you pay Cdn taxes on all your income until the day you leave. You pay US tax on the US income, and take credit for the tax on your dpearture return.
5. You should be winding this down, since it loses its CCPC status anywys, and is unnecesary.
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
Normal tax time. If you move in Jan 2013, you will not have to file the return until spring 2014, but you must still comply with any non-resident requiremnts, and act accordingly.
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