Looks like the bank forgot to withhold 25%

[Cutesy]

I withdrew some RRSP money in 2024 and was excited to fill out the Canadian tax form for non-residents in order to get some of the 25% taxes returned to me. However, to my dismay, it now looks like I owe CRA a chunk of money because RBC Bank didn't do their part in withholding 25% in each of my cheques. Sheesh! What is the best way to pay? (=the least costly). Can I send them a check in US dollars? I'm guessing not, but that would be easiest for me as I don't have a Canadian bank account.

[nelsona]

How this happened:
Could be you didn't notify RBC that you were a non-resident? A US address does not necessarily mean they consider you non-resident. You need to get this fixed for future.


So, first off, any payment or refund for incorrect NR withholding is NOT done simply with a non-resident return. It is done by a letter explaining the difference. And even if it was withheld correctly, you would file a 217 election return to *possibly* get some refund, proving that your WORLD income (not just CDn-sourced) was very low for the year.

You could pay by debit card or paypal, or wire. Call and ask.
https://www.canada.ca/en/revenue-agency ... yment.html

Can I ask how RBC sent you the funds, since you don't have a CDn bank account? If the bank accepted your Cdn cheques, they can probably write you a CDn dollar bank draft.

[nelsona]

Looking at your other posts, is it possible that the NR5 you filed in the past was used by RBC to determin that they did not need withholding. Last year, did you, in the end, get all your NR tax back on you 217 return?

[Cutesy]

Yes. Every time I call them to withdraw a chunk from my RRSP, I state over the phone that the taxes should be 25% for non residents, and the agent agrees.
I received the Canadian $$ cheques by mail to my US address, and deposited them in my Canadian foreign funds account at EverBank.
A letter to whom? Yes, I will call CRA and ask.
I applied for the NR5 twice, and was denied because they said I made too much money (world income). But I don't. In fact, the previous year (2023 taxes) my Section 217 refunded $2900 of the $7500 that had been withheld.
I guess I just didn't pay attention to the amount when RBC sent me my cheques (one for each fund withdrawal, four cheques total).

[nelsona]

Well, since you are familiar with the 217 process, you can skip the letter to CRA (International office in Winnipeg).

Just do your 217 return, with schedule A,B,C and figure your tax owing. Don't forget to include your medical expenses including premium, from you and if applicable, your spouse, as a deduction.

Then you are back to your original Q. can you wire the CDn funds out of EverBank?

Depending on how much you have left in RRSP, you might consider converting to RRIF, and taking the first 10% at 15% tax.

As to why your NR5s are being rejected, could be that they typiclly don;t consider deductions other than the personal amount when figuring wether you will reduce your NR tax.

[Cutesy]

Oh good, I'm glad I can skip the letter, thank you!
I just need to wait for my NR4 from RBC, and then can I include money order/check with my tax forms?

[Cutesy]

Oh. I see the check goes to Ontario, and the tax form goes to Winnipeg. I've answered my own question, thank you.
AND...I'm done with the RRSP! Took out my last chunk this month (and they withheld the correct amount!)

[nelsona]

I would NOT split the return and the check. Send it all to Winnipeg. Nothing to do with Sudbury. Not sure where you got that idea.

[Cutesy]

I found it on the CRA site as to where to send payment by mail.https://www.canada.ca/en/revenue-agency ... heque.html

[nelsona]

That is if you recieve a payment notice, from an assessment or reassessmnet.

One always submits payment with the mailed-in return.

[Cutesy]

Thank you so much for all your help! I'd be lost without you.