Korean Job Discussion Forums

[Doogie]

My contract is coming up soon and I'll be leaving Korea. To you Canadians, I was just wondering how it works for the taxes we've paid in Korea. Yikes! (badly worded).....Does the Korean government give us a statement of foreign income to show the CCRA in Canada? Also, are we going to be taxed in Canada on these sames monies?

[khyber]

I've talked to an international accountant and asked his opinion.

When you left, you should have filed a "part year" return so they'd know you were leaving. Then, once you return, you file taxes next year from the date you return and make money in Canada.

He told me there was nothing specifically for us to do.

This preassumes you have taken the necessary steps (when you left) to cut residency ties with Canada. The big ones (and NOT all of them) are:

1) Dwelling (if you own one, did you sublet): Not own? No problem
2) Financial ties: Bank accounts, RRSPs, etc... (I kept mine to upkeep my credit card which I didn't think my E-2 visa would afford me).
3) Possessions: Big ones like cars etc...

If you ARE living in korea, it's a good idea to save things like mail with your address (bills, insurance info, etc..); your contract; if you have a contract for your apartment, keep that; ANYTHING that proves you lived here is a benefit to you.
They won't do anythign unelss they are suspcious. At that point, YOU have to prove that you were out of country.
That's all.

[chinook]

You will get 100s of different answers to this question...

Before I left the first time, I was lucky to be friends with some at Revenue Canada.

So, to not pay taxes, you have to be a non-Resident. To be a non-Resident, another country has to consider you a Resident (Korea does for these purposes) and you can't have any primary ties to Canada or too many secondary ties to Canada. Since the secondary ties are what most ESL teachers need to worry about, and since this is an individual determination, it can be confusing. Also, you do not declare non-Resident status in any way.

Korea and Canada have a tax treaty. If you were non-Resident, you do not pay any additional taxes. If you were a Resident of Canada even while working in Korea, you would be taxed at a Canadian rate, with the amount of tax you paid in Korea being deducted from the total.

Most ESL teachers are non-Resident.

The people I know who have filed taxes and talked about their Korean salaries have simply used their payslips from their schools. No one I know of has been audited. So, that seems to work for most.

I would personally go that route, myself, though since I have lived overseas for well more than a year and haven't been a resident for all that time, I simply don't file Canadian tax forms.

[The_Conservative]

[Vissan]

What if you were gone for only a year and you just don't say anything at all?
I left in septmeber, and have filed for the money I made in canada that year up to september. When I come home the following year, I'll file for the money i make sept - dec.

I've had 2 friends that have left canada for a year or so, and they did the exact same thing.

I talked to a family friend accountant, and this is what was recommended to me.

[khyber]

[Tokki1]

Sever your ties with Canada, declare nonresidency, and you pay Korean tax (and don't give Canada a dime).

Don't and you will face a huge bill when you get back to Canada.

Tax is based on residency in Canada. I gave up my medical, bank accounts and I have no dependents or property which is a residence or that I collect rent on in Canada, so technically I have no 'ties' and I'm considered a 'nonresident' for tax purposes although I'm a citizen.

It's very easy to do. And you can do it retroactively.

I filed for nonresidency back in 2001 and got it. Only thing is, when you come back home to visit you have to stand in line with the Americans, lol.

[Arthur Dent]

I believe you can have a bank account as long as it is a checking account and thus used for bill payments. They are not unreasonable in this. I can confirm the need to cancel Government medical insurance, and any vehicle ownership/registration. Property of any major value such as the aforementioned or land/house property is also taxable and so must be ceded if you want non-resident status. Income which pays interest such as saving accounts or stocks which pay dividends are taxable (this is getting deeper and beyond my knowledge as far as the details). The medical is a bit of a risk as the coverage here is - reportedly - not very good. This is why some choose a private policy. Credit card companies offer insurance. If you are on a hagwon salary though, and saving or paying off debt, this may be a risk you will want to take. Any former tax accountants or Revenue Canada workers out there?
The passport entry/reentry stamps only prove that you have been out of the country and in and of themselves only show that you were not in Canada. Good idea about the bills and payslips though. For the payslips, I am sure they will be impressed with mine as they have tests and language puzzles on the backside due to the schools attempts to save money!

[Tokki1]

I own property in Canada and have nonresidency.

How? It's not my primary residence and I collect no rent on it.

There are loopholes.

[lulu144]

what about if we are being over taxed in korea?? I work for kind of a governemnt place and I'm taxed more than when i was in a public school. I will be leaving korea soon, and I heard that you can get korean tax paid back. is that true??I'm also a non resident of canada etc etc

[khyber]

[Doogie]

Thanks for the feedback, everyone. I think I'm going to look into the "non-residency" route. It makes sense as I plan on coming back to Asia next year for one more year. Can I do this now or should I wait until I'm back in Canada in September? I'm fortunate in that I sold virtually all my property. The only thing I really have is a bank account. I'll look into it, but I'm sure I'll still be able to keep the account open as a non-resident.