Leaving Canada next month

[Sam and Ben 2]

While I can see there being an issue with out and out cashing a cheque in the U.S., I know that Chase, at least, has no issue with depositing Canadian cheques. I believe they said it would be a 5-10 day hold on it, but that's it.

[Revenesque 2]

We too had all the things Ashen mentioned - except for the vehicle, mind you we didn't cancel the registration on that - so it was still registered in Canada as well.

All I am saying is it is not cut and dried. We cannot say that she is a Canadian resident for tax purposes because she has 1 possession in Canada and a few credit cards/bank accounts. Also, she doesn't need to file that 2010 return if she is not and has no income. That's all I was saying

As with regulation, the CRA rules are there and one can choose to comply with them or not. Since the CRA is based on honor system and random audit, if one gets caught in non-compliance, he/she will face the consequences of tax penalities and interest.

Before my current profession in IT, I was a financial planner with Canadian tax background, and I studied alot of tax cases re: non-residency and taxes, and let me tell ya, many of them are unhappy ending for the non-residents.

Edited December 8, 2009 by Ravenesque

[Revenesque 2]

I should mention that Canada does not like losing taxpayers and scrutinizes non-residency files pretty closely for compliance.

[minnew 4]

As for banking..I thought I had read somewhere on here that people use Paypal to move money from their Canadian accounts to their U.S. accounts.

There are alot of smart people on this site and maybe one of them remembers this also and can give you more details.

Good Luck with your move and all the best to you in 2010 !!

I use Customhouse! They are completely free if you do EFT transfers between US and CAN accounts. I used them alot before I moved here to the U.S. and will be using them frequently in the coming months, as I have GMAC and student loan payments in Canada. Alot of Canadian VJer's use them and have had great reviews!

When tax time comes I am sure it will be interesting this year, but so far no EI payments to sort out between returns... *pulls out hair*

[trailmix 77]

We too had all the things Ashen mentioned - except for the vehicle, mind you we didn't cancel the registration on that - so it was still registered in Canada as well.

All I am saying is it is not cut and dried. We cannot say that she is a Canadian resident for tax purposes because she has 1 possession in Canada and a few credit cards/bank accounts. Also, she doesn't need to file that 2010 return if she is not and has no income. That's all I was saying

As with regulation, the CRA rules are there and one can choose to comply with them or not. Since the CRA is based on honor system and random audit, if one gets caught in non-compliance, he/she will face the consequences of tax penalities and interest.

Before my current profession in IT, I was a financial planner with Canadian tax background, and I studied alot of tax cases re: non-residency and taxes, and let me tell ya, many of them are unhappy ending for the non-residents.

I certainly would never suggest that someone should be anything less than honest when claiming to be a resident or non-resident.

[Persona 0]

yes but im talking about this year tax return... should i get the papers and have them done right away so that i can ask my grandmother to mail it when February arrive ?

2009 i have worked and paid tax... so technically im leaving on the 6 January but i won't work or pay tax starting 30 of December...

so im thinking i have to just do the tax paper for quebec and canada only once and mention that i left on the 6th right ?

[ashenflowers 5]

Sheesh. I was just asking some questions, and didn't intend to cause a debate. I'm not trying to 'cheat' the system, I'm just trying to figure out how it works. I'll file whatever is required. I just went by what was posted on that list of "Residential ties include:"... since I have a few, it was confusing.

The bank account is kept because my car payments come out of it, and my credit card is not paid off because I can't afford it, so I have to keep that open until I can get it paid off in a couple months (the bank account is also there to help with making payments).

As for the car.... the lease recently ended and we decided to buy it out due to small damages like paint scratches and chips being estimated at $1000 to fix (which is stupid because the car itself was only worth $4800 at the end, and it seemed useless to put that much money into a cheap vehicle that we would just return).... My parents will be using it and paying for it, but it has to stay in my name, since they are unable to put it in theirs due to their personal situation.

[Revenesque 2]

yes but im talking about this year tax return... should i get the papers and have them done right away so that i can ask my grandmother to mail it when February arrive ?

2009 i have worked and paid tax... so technically im leaving on the 6 January but i won't work or pay tax starting 30 of December...

so im thinking i have to just do the tax paper for quebec and canada only once and mention that i left on the 6th right ?

Ebrech, you have until April 30, 2010 to file your 2009. Is there a reason why you want to file it earlier?

[Revenesque 2]

Sheesh. I was just asking some questions, and didn't intend to cause a debate. I'm not trying to 'cheat' the system, I'm just trying to figure out how it works. I'll file whatever is required. I just went by what was posted on that list of "Residential ties include:"... since I have a few, it was confusing.

The bank account is kept because my car payments come out of it, and my credit card is not paid off because I can't afford it, so I have to keep that open until I can get it paid off in a couple months (the bank account is also there to help with making payments).

As for the car.... the lease recently ended and we decided to buy it out due to small damages like paint scratches and chips being estimated at $1000 to fix (which is stupid because the car itself was only worth $4800 at the end, and it seemed useless to put that much money into a cheap vehicle that we would just return).... My parents will be using it and paying for it, but it has to stay in my name, since they are unable to put it in theirs due to their personal situation.

Ashenflowers, sorry for sounding harsh. :-) That's not my intention at all. I just wanted to make sure people are aware of the tax rules and not get themselves in a mess.

I'm not at all accusing YOU of cheating the system--cuz you're not. It's possible to be filing taxes for both countries and still maintain residential ties for tax purposes with Canada because sometimes it's difficult or not convenient to sever them right now. Everyone has their own reasons. Depending on the situation, it might not be a bad idea.

I'm just highlighting the real risk that if one filed with the CRA that they are non-resident, make sure they really meet the requirements of non-resident from the CRA's perspective. From the tax cases I studied, one guy who severed all ties with Canada, but had a canadian driver license, got nailed as resident. He had to pay taxes on his worldwide income for some 3-4 yrs. Another guy, also severed all ties with Canada completely, but his wife (unknown to him) applied for Canadian child benefits and received them. That was enough to deem him a resident, and again had to pay taxes in the area of $400K!

I studied cases closely because my tax situation is very complex and I wanted to make sure I dotted all my i's and crossed my t's when I finally move to the US.

Edited December 8, 2009 by Ravenesque

[Persona 0]

yes but im talking about this year tax return... should i get the papers and have them done right away so that i can ask my grandmother to mail it when February arrive ?

2009 i have worked and paid tax... so technically im leaving on the 6 January but i won't work or pay tax starting 30 of December...

so im thinking i have to just do the tax paper for quebec and canada only once and mention that i left on the 6th right ?

Ebrech, you have until April 30, 2010 to file your 2009. Is there a reason why you want to file it earlier?

ya getting my money faster ? XD since im assuming i won't be illegible for work insurance *Chomage in french* not sure how you call it in English..

but i worked all year and would love to have some kind of money until i find my next job... not that i absolutely need it but it would help

[Persona 0]

Sheesh. I was just asking some questions, and didn't intend to cause a debate. I'm not trying to 'cheat' the system, I'm just trying to figure out how it works. I'll file whatever is required. I just went by what was posted on that list of "Residential ties include:"... since I have a few, it was confusing.

The bank account is kept because my car payments come out of it, and my credit card is not paid off because I can't afford it, so I have to keep that open until I can get it paid off in a couple months (the bank account is also there to help with making payments).

As for the car.... the lease recently ended and we decided to buy it out due to small damages like paint scratches and chips being estimated at $1000 to fix (which is stupid because the car itself was only worth $4800 at the end, and it seemed useless to put that much money into a cheap vehicle that we would just return).... My parents will be using it and paying for it, but it has to stay in my name, since they are unable to put it in theirs due to their personal situation.

Ashenflowers, sorry for sounding harsh. :-) That's not my intention at all. I just wanted to make sure people are aware of the tax rules and not get themselves in a mess.

I'm not at all accusing YOU of cheating the system--cuz you're not. It's possible to be filing taxes for both countries and still maintain residential ties for tax purposes with Canada because sometimes it's difficult or not convenient to sever them right now. Everyone has their own reasons. Depending on the situation, it might not be a bad idea.

I'm just highlighting the real risk that if one filed with the CRA that they are non-resident, make sure they really meet the requirements of non-resident from the CRA's perspective. From the tax cases I studied, one guy who severed all ties with Canada, but had a canadian driver license, got nailed as resident. He had to pay taxes on his worldwide income for some 3-4 yrs. Another guy, also severed all ties with Canada completely, but his wife (unknown to him) applied for Canadian child benefits and received them. That was enough to deem him a resident, and again had to pay taxes in the area of $400K!

I studied cases closely because my tax situation is very complex and I wanted to make sure I dotted all my i's and crossed my t's when I finally move to the US.

im confuse... lol... does it mean next year ill have to fill 2 still ? like this year i fill just one ? or do i need to fill one in the US as well since ill be staying since 2 months ? (that's considering if i fill them in February)

what about me being engaged now ? do i have to declare all what my fiance gain ? or i do it separately ...

[La Souris 19]

ya getting my money faster ? XD since im assuming i won't be illegible for work insurance *Chomage in french* not sure how you call it in English..

but i worked all year and would love to have some kind of money until i find my next job... not that i absolutely need it but it would help

Pour l'impôt, je ne suis pas certaine. Pour l'assurance-emploi, il y a plusieurs Canadiens expatriés qui ont réussi a en avoir, il y a un sujet juste sur ça, ici: The Canuck EI Thread.

[ValerieA 350]

im confuse... lol... does it mean next year ill have to fill 2 still ? like this year i fill just one ? or do i need to fill one in the US as well since ill be staying since 2 months ? (that's considering if i fill them in February)

what about me being engaged now ? do i have to declare all what my fiance gain ? or i do it separately ...

ENP, for 2009, you were a resident for the entire year, and you were a resident on Dec 31st, so you only have to worry about filing a Canadian tax return, and you do not include your fiance's income. NEXT year is going to be the tricky part.

A resident is taxed on all worldwide income. However, there is a tax treaty between the US and Canada, so double taxation should not be a real issue.

A nonresident is only taxed on income earned in Canada (so, if you had interest on a bank account, or investments in Canada).

Here is the Interpretation Bulletin from CRA, as well as a form that you (well, quite a few of us eventually!) will have to fill out and submit to CRA to determine residency. From the way I read it, you will be a resident of Canada until you are a "permanent resident" of the US. So, you will have to file 2 tax returns for 2010, yes. One Canadian return for the first few months you are not yet a permanent resident of the US, and therefore almost by default still a resident of Canada, and the second being your US return.

My head hurts now.

Interpretation Bulletin

http://www.cra-arc.gc.ca/E/pub/tp/it221r3-...-consolid-e.pdf

Determination of Residency Status (Leaving Canada)

http://www.cra-arc.gc.ca/E/pbg/tf/nr73/nr73-08e.pdf

[trailmix 77]

ENP, for 2009, you were a resident for the entire year, and you were a resident on Dec 31st, so you only have to worry about filing a Canadian tax return, and you do not include your fiance's income. NEXT year is going to be the tricky part.

You don't actually have to fill out that form, really it is only for people who are having trouble determining whether they are residents are not - you submit the form and they will let you know.

Next year shouldn't be too tricky for EnP really, she will not have any Canadian income, therefore she won't need to file a Canadian return. If she works in the U.S. then she will have to file a U.S. return only. Becoming an actual permanent resident of the U.S. - ie: they hand you the green card, does not determine residency for Canadian taxation purposes.

[Sam and Ben 2]

Man, was I ever confused in thinking my tax returns would be so easy, then.

I thought, leaving before December 31st meant I would only have to worry about filing for 2009. Not being able to switch my Canadian DL to a US one is going to bite me in the butt though? Oi..