Canadian Cruise Ship employee Residence / Taxation - Help - Expert Income Tax help on cross Border tax and immigration & div
Good day Experts!
Here is my case briefly.
Left Canada to work on board Cruise Ships in April 2003.
PRO’s:
Days in Canada:
1. 2004 – 61 days, 2005 – 62 days, 2006 – 42 days, 2007 – 35 days, 2008 – 39 days, 2009 – 53 days
a. Proof of this with Previous Passport stamps and Seaman’s Book Certificates
2. Do not have any “significant residential ties” (Dwelling, Spouse, dependents)
3. Conscious effort to sever all possible secondary residential ties
a. Proof of relinquishing Canadian Health Care Card in June 2004
b. Proof of selling car owned by myself in June 2004
c. Proof of Closing Bank Account in June 2004
4. Cruise Company is not Canadian or American
CON’s:
1. Was not able to establish bona fide residency in any other country as I was working on a cruise ship and traveling
2. Kept Quebec Drivers license as I needed to be able to drive and could get license elsewhere
3. Kept Canadian Passport as I did not change my citizenship
I read about the verdict In 1988, Frederick Reed Case which was not too encouraging, but he did have a car, and credit union involvement where I do not.
“Judge Bonner of the Tax court ruled that he could not claim his place of employ or the ship as his residence and just because he did not have a fixed abode, did not make him a non-resident. He was also the beneficial owner of a car in Canada which even though of minor consequence, served to add to his Canadian Residency. He had in fact borrowed money from a credit union to buy the car, even though it was registered in his father's name. He had maintained his Canadian Driver's licence as well.”
I have no plans to come back to Canada, but you never know.
Is anyone aware of any other cases involving employees of cruise ships similar to my case that have deemed the person a non-resident?
I read from a few sources that submitting the NR73 is not a good idea and more of a pitfall?
Do I have a case here?
How should I proceed in order to protect my hard earned money being someone who has not benefited from using any residential benefits of Canada aside from the Drivers Licence and Passport?
I don't want to make any false moves...
* a response or guidance would be so appreciated. :-)
Thank you.
I know of no one in your case being ruled a non-resident. I know several who have been taxed very significantly. Whatever you do, do NOT fill out an NR-73, That will just point yourself out as a taxable Canadian.
You are taxable in Canada on your World income if and when The CRA catches up to you.
To be a non-resident and avoid Canadian Income tax, you must establish a bone fide residence in another country,. AND THEN!!!! - You must be in that other country for more than 6 months a year. .
As described, you are a resident of Quebec (driver's licence renewed) and return to Canada for major vacation times. Since most of us live on a two or three week vacation and you describe time in Canada when you were not working of up to 2 months.
If I were you and wanted to avoid Canadian Income Tax, stay out of Canada for the next two years and then do not come back. If your friends are in Montreal, settle across the border in New York or Vermont and invite Canadian Friends down to visit you there. If your friends are in Toronto, rent a place in Niagara Falls, New York and invite the friends down. If they are in Vancouver, rent a place in Ferndale or Mount Baker and Stay out of Canada.
Otherwise!!
One of these times when you come across the border, you get cleared through by a Customs man who just transferred to Customs from Income Tax and is charged with finding Canadians who have not been filing.
I could not make an argument for your being a non-resident.
And, we have had half a dozen cruise ship people who have been caught somehow and have ended up with large large LARGE tax bills back for up to ten years.
Stay out of Canada if you are a Canadian citizen without a home in another country,.
Don't even come here for a day. One day could easily cost you $100,000 in back taxes.
And, if you do not get caught at the border, a friend, lover, fellow employee you piss off, or any one out there can write an anonymous letter and you are toast.
Sorry, but you did ask for a letter.
And just for our American Friends. An American can make $80,000 to $90,000 out of the country by filing form 2555 and proving they were not in the US or US territorial waters for more than 35 days a year. In this case, if you were an American, you would have avoided US tax in 2007 only and that assumes that the ship did not dock in New York or Miami or Fort Lauderdale or the US Virgin Islands, etc.
Hope this helps someone.
Please also note that we prepare Canadian, US, Australian, UK and New Zealand returns on a mail in, email, fax, snail mail or couriered basis. At any time, our clients are in 40 countries or more. They have every occupation from nuclear Submarine captains to FedEx pilots to Major Bank officers to Politicians, Diplomats and border patrol officers. My favourite, however, is a penguin catcher in Antarctica among others there..
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