Include deferred capital gains/losses in departure tax return?

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Include deferred capital gains/losses in departure tax return?

Post by CadCad » Tue Mar 26, 2019 9:23 am

When filing a departure tax return in Canada, if as a result of deemed disposition I incur a capital grain and defer payment of that tax liability using form T1244, should I include that gain in my departure tax return? I can't find official guidance on way or the other and speaking with 2 different CRA agents didn't help :(

As an example: let's say I file a departure return (without considering deemed dispositions) and I'm entitled to a refund of $100, then after filing form T1244 I find out that I have a tax liability of $400 which I deffer using that same form. Which should be the proper course of action:

1) Update my departure tax return by including that gain so it flows through and shows I have a balance owing of $300
2) Leave the capital gain that came as a result of deemed disposition out of my return so it is still shows a refund of $100, the only reference to the deemed disposition and deferral would be listed in form T1244

If option 1, should I still pay the $300 and then wait for a refund of $400? ($300 deferral + $100 when excluding that gain)

Help please!

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Re: Include deferred capital gains/losses in departure tax return?

Post by nelsona » Wed Mar 27, 2019 5:35 am

The deemed dispo MUST go on your return, and comes from form T1243, not T1244. In your example, $500 of tax.
The deferring of tax is a separate issue dealt with on form T1244, which CRA must approve.

In your example, you would file a return attaching T1243 showing you owe $400, and attach T1244, asking that you be "credited" $500, and ultimately get a refund of $100.
Nelsona Non grata. Non pro. Search previous posts. Happy Browsing :D

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