Job Discussion Forums

[travelasia]

Hello ive read the posts regarding having to pay taxes in canada. i do not wish to declare myself a non resident because i have a house..bank account. blah blah. how do i avoid paying taxes? to willy in japan..how did revenue canada find out about your friends year long stay in japan. has anybody been in a similar situation..being a resident still and not having to pay taxes? please help.

[JimDunlop2]

Easy answer. You can't have your cake and eat it too. At least, not if you want to be legal about it. If you are not a non-resident, you are required to declare and pay income tax on global income sources. If you do not, it's tax evasion. There is no way "around" that. As far as I know, most or pretty much ALL the loopholes for legally doing this sort of thing have been closed, leaving only illegal ones. Those I honestly know nothing about as I haven't explored any of them.

Now, whether or not Rev. Canada will find out and get on your ass for it or not is anyone's guess. My guess is, there's a very good chance you'd never get caught... But I'm sure that everyone who's ever been caught thought exactly the same thing. I suppose you could hide the evidence in an overseas bank account, but technically speaking, you'd be breaking the law.... I dunno how to help you with that. Morals aside, whether I believe it's right or wrong, I honestly don't know how to help you with a request like this.

[Gordon]

You can't be a resident of Canada and expect not to pay Cdn taxes. Otherwise none of us would go through the process of being a non-resident. It is no fun giving up your ties. If you receive the benefits of being a Cdn resident, then you should pay for it.

[Celeste]

You need to consult with an accontant who specializes in this area of Canadian tax law. There are non-residents who still own homes in Canada, but these homes are rented out to non-relatives. You can still have a bank account, but obviously that is another tie. Big red flags would be:

A spouse or dependent child still living in Canada.

A furnished home awaiting your return to Canada.

A car in Canada.

Medical insurance in Canada.

You may qualify as a non-resident, but you really need to get that paperwork done and if it is a bit much for you, then hire someone to do it. You can pay an accountant, you can pay the CRA, but either way, you will pay

[ToraGal]

It's crappy really- but reality.... I suggest u live in Japan TWO years- then u can declare non-residence status and get ur break

I got jacked - i was away almost two years- and had to pay almost TWO Grand back-- sooooooooo thats my advice

[JimDunlop2]

As the cheezy bumper sticker says: "Don't steal. The government hates competition."

That's all.

[canuck]

[Willy_In_Japan]

I wouldnt go so far as to say the two year rule is a 'myth' but certainly a 'guideline'.

How did Revenue Canada find out? Well, they wanted her to file her income tax for the year she was away. She was out of the country and they asked her where she was and what she was doing.

I guess she could have lied and said 'travelling'...but I do know that tax treaty countries can share information on foreigners working in their country. How much that happens is anyone's guess. I was told she got hit for approximately 5000 dollars. She is/was an aquaintance, and not really a friend. She did a stint with GEOS.

[canuck]

[ionix-]

I just went through the process myself and canuck is right. It is about your ties and if you indent to leave Canada permently. However, there is a very strict minimum of 1 year + 1 days to be elligible. (I.e you can't claim non-residency the year you leave Canada)

[craven]

I'm going into my third year in Japan...I filed taxes after my first because I had spent time in Canada during that year (I had to pay a little tax for this period). I talked to Revenue Canada about whether or not I had to file a return for the time I was not living in Canada, and they said it depended on whether I had self-judged myself to be a non-resident (as in, actually filing the paperwork to be deemed a non-resident was not necessary). I also asked about ties to Canada (I don't have a car, I don't have a house, spouse or dependants in Canada...I DO have a bank account there, but I also have two in Japan as well as a car and furniture here). I cancelled my health card when I left as well.
After hearing my story they said I was under no obligation to file a tax return...
If this is different from what other people have experienced I'd love to hear about it.

[canuck]

It's all about ties to Canada. Your bank accounts here mean nothing. You have a bank account in Canada...one tie. A Canadian credit card....one tie. A passport...one tie. A driver's licence (if you intend to renew it)...one tie (just not intend to renew it).

Until you get something in writing, they can change there mind and you could owe back taxes. The best way is to make sure you have under six ties back to Canada, and preferrably get a decision in writing.

[craven]

I'd read about keeping it under 6 ties as well...although I'd also read that a passport was not considered a tie since its was required to move abroad
Does anyone know how to get an agreement in writing, or would that require actually becoming a non-resident?

[JimDunlop2]

yup...

I actually gave links to all the relevant info in this thread not so long ago...
http://www.eslcafe.com/forums/job/viewtopic.php?t=23316&highlight=tax+canada

If you don't want to read it (it's long and drawn out with a high noise to advice ratio).

I quote myself (from the above thread):

[Gordon]