Job Discussion Forums

[gadfly]

I was wondering about tax laws for Canadians outside of Canada do we have to pay to taxes or not? I asked this question before but did not recieve a really clear answer. I was wondering what the rules are for this?

Thanks Gadfly

[dmb]

Coral, molly, Yaramaz?

[molly farquharson]

I left Canada 30yrs ago and don't know. I suggest you look on the Cdn govt web site and/or call the consulate here. I know for Americans and Am residents, you can download the foreign earned income form from the internet and use that. Perhaps Canada has a similar thing. Good luck!

[corall]

as far as i know - as long as you are out of the country for 2 years or longer - with no use of health card or anything to say that you've been in the canadian system whatsoever you can apply for some sort of special out of country status that will make it so that you don't have to pay taxes. however if you have used your healthcard or something like that and they decide to audit you and find out that you have been in the system then you will have to back pay taxes for all the time you've been away - i my self am not looking forward to filing for taxes as it has been a while and i am liable to get screwed over as i have been in and out of the country...so i think i'll stay out a little longer...

[yaramaz]

It's a bit more complicated than that, 2 years away or not. I've been away a lot longer than that and the non residency thing doesn not come automatically nor does it mean you stop filing your tax returns.

I am a non resident these days (I hadnt filed for it- it just happened) and I learned to my surprise last summer that I am not entitled to any medical services etc because of this... even though I have been filing my return every year and paying taxes to Canada.

For the past few years I have had to get tax statements from my school to show my gross and net income so they can compare it to the Cdn tax rate and see if we paid enough. However, Revenue Canada said that the school's statements werent valid and I also needed to file a tax return with the Turkish gov't to prove I paid everything I needed to and wasnt entitled to a Turkish refund (eh???). This was not possible, I was told by every Turk I asked. Schools pay your taxes before you even see your income and its rate is determined when you sign your contract (or something like that).

Anyhoo, I had to hire an accountant after my first year here because Rev Can decided that I owed 650 cdn on my 1800 sterling earnings (sept-Dec). Hm. Something to do with foreign tax credit. I really didnt understand it all and neither did my accountant and well, neither did Rev Can. Now, 3 years later, I might be getting my money back soon... And they have decided that I neednt pay more taxes this year. Yay!

One thing to note: if in doubt, file your return! I didnt file for 3 years when I lived in the UK and paid my taxes there (and was poor), then I came back to Canada and found out that I also owed Canada money in spite of my piddly income in the UK.

My advice? Get an accountant. It really helps.

Did that make sense?

[ghost]

If you have no intention of returning to Canada, it is worth declaring "non residency" and you do not have to wait two years to do so.

But in order to do that (become a non-resident Canadian) you have to cut all your ties to Canada....including bank account, home, car, health card, assets, etc....not easy to do.

Having documentary proof that you are taking a job in some other part of the world helps, as does any proof that you are really becoming a non-resident.

Nothing will stop you becoming a resident again in Canada when/if you return, but you would have to wait a period of several months to get some benefits back, like the health card (3 months in Quebec Province).

In most Provinces, you can also take a 'sabbatical' from Canada, every 7 years or so, without losing your benefits.

[corall]

ps - also had a friend that claimed non residency as well. she was in korea for 7 years - the waiting was the hardest part- about a month i think, but they accepted it, and she didn't need an accoutant. she used her health card once and that was the biggest issue against her if she were to get audited but it all worked out in the end

[yaramaz]

It might just be a BC thing then- the provinces are all slightly different. I consulted several accountants about it and was told you have to file a tax return even if non resident-- you just don't pay any extra taxes.