Just read a statement from CRA website regarding emigrant:
http://www.cra-arc.gc.ca/E/pub/tg/t4056 ... l#P69_2962
..........
If you are the spouse or common-law partner of a deemed resident and you left Canada in 2006, you may be considered an emigrant unless, under an agreement or convention (including a tax treaty) between Canada and another country, at least 90% of your world income is exempt from tax in that other country because of your relationship with your spouse or common-law partner.
.........
It's still hard for me to understand the statement in order to determine my status.
I moved to US in last January and all my income in 2006 were from US employer (about 85,000). My wife still works in Ontario and earned 65,000 last year. We don't have kids or own house in CA or US. In terms of above statement, I just wonder if I can be deemed as emigrant or deemed non-resident of Canada so as not to need to file a tax return to CRA?
Thanks for your comments!
Determine residency status by income, how to?
Moderator: Mark T Serbinski CA CPA
Deemed resident applies primarily to Government workers. Ignore this. neither you nor your spouse are Deemed Residents. Your wife is a resident. pure and simple.
You are *probaly* still resident in canada, since your wife is, and seems to have no intention of joining you in US.
The only thing that might act in your favour is if you did not visit Canada with any frequency in the past year. This would make you a deemed non-resident from lsst january. But if you commute home every couple of weeks, and did not have a permanent appartment in US (there is no need to 'own' your home).
So you may need to file areturn and report all your income for 2006 in canada. At least, you must advise canadathat you left, and pay any departure tax.
Bye til May.
You are *probaly* still resident in canada, since your wife is, and seems to have no intention of joining you in US.
The only thing that might act in your favour is if you did not visit Canada with any frequency in the past year. This would make you a deemed non-resident from lsst january. But if you commute home every couple of weeks, and did not have a permanent appartment in US (there is no need to 'own' your home).
So you may need to file areturn and report all your income for 2006 in canada. At least, you must advise canadathat you left, and pay any departure tax.
Bye til May.
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
Thanks Nelsona for your clear explanation!!! (why bye until May?)
I rarely went back to Canada (2-3 times) since I left in Jan.
After I move to US last year, I immediately infomed CRA of my departure and the changing of my address . So the assessment of notice for 2005 was mailed to new address in US.
I added my moving expense in calculating my tax return of Canada using QuickTax. It seems the software accepts my claim. But I remember that you said in other thread that CRA won't take moving expense incurred in moving out Canada. right?
I rarely went back to Canada (2-3 times) since I left in Jan.
After I move to US last year, I immediately infomed CRA of my departure and the changing of my address . So the assessment of notice for 2005 was mailed to new address in US.
I added my moving expense in calculating my tax return of Canada using QuickTax. It seems the software accepts my claim. But I remember that you said in other thread that CRA won't take moving expense incurred in moving out Canada. right?
You have a good case for declaring departure in january. You should file a tax return for 2006 with adeaprture date in January. Make sure you review the "Emigrants Guide" from CRA, as well as NR73 (don't submit, just review) to be sure you have done everything that you can to sever ties (this is to overcome the HUGE fact that your spouse still lives in Canada).
This should satisfy CRA that you are a Deemed Non-Resident (very key definition).
I'm puzzled as to why you would even have included moving expenses, since you should not be reporting any income (that's the whole point of the residency determination, isn't it?). Even if you did, you are not eligible for moving expenses, on your Cdn return, because you were leaving canada.
This should satisfy CRA that you are a Deemed Non-Resident (very key definition).
I'm puzzled as to why you would even have included moving expenses, since you should not be reporting any income (that's the whole point of the residency determination, isn't it?). Even if you did, you are not eligible for moving expenses, on your Cdn return, because you were leaving 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
Again, many thanks Nelsona!
The reason that I included moving expense was that I thought that I still need to file a NORMAL 2006 return (i.e. report all my world income to CRA) and just indicate my departure date as Jan 2006 on the return. (And in the hope that CRA won't tax my US income once they notice that I left in Jan 2006). That was my understanding about the definition of departure return you mentioned. Please kindly correct me if I am wrong at this point.
After reading through your latest reply, I guess that , for my case, the correct way to file my CA return for 2006 might be:
-----I need to file a canada 2006 return but don't need to report any US income earned after my departure date and indicate the departure date on the return.------
Is this all right?
Thank you
The reason that I included moving expense was that I thought that I still need to file a NORMAL 2006 return (i.e. report all my world income to CRA) and just indicate my departure date as Jan 2006 on the return. (And in the hope that CRA won't tax my US income once they notice that I left in Jan 2006). That was my understanding about the definition of departure return you mentioned. Please kindly correct me if I am wrong at this point.
After reading through your latest reply, I guess that , for my case, the correct way to file my CA return for 2006 might be:
-----I need to file a canada 2006 return but don't need to report any US income earned after my departure date and indicate the departure date on the return.------
Is this all right?
Thank you
In the year of departure, you report ALL world income earned before departure, and then ONLY CDn income which was not subject to flat NR tax after departure.
This highlights the importance of telling your broker/banker/etc that you are non-resident.If you have not done so, this weakens your claim to be non-resident.
The emigrants guide, which you no doubt have read thoroughly by now, explains this.
You don't report income in the hopes that CRA will exclude it. That will never happen.
This highlights the importance of telling your broker/banker/etc that you are non-resident.If you have not done so, this weakens your claim to be non-resident.
The emigrants guide, which you no doubt have read thoroughly by now, explains this.
You don't report income in the hopes that CRA will exclude it. That will never happen.
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