Canadian Citizen on Vancouver Island,

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Sent: Friday, December 19, 2003 4:55 PM
To: [email protected]
Subject: Canadian Citizen/US Corporation
Hello,
Interesting reading your website is. I have a situation I would like your opinion on. I am a Canadian citizen living in the USA and I want to move back to Vancouver Island. I have heard much to-do about owning a corporation (incorporate in Nevada) and want to incorporate before I return to Canada. I would be President of the US corporation. Now, can my corporation own real estate (income properties) in Canada? My income would come from the US corporation. Is this starting to get a little sticky? Or can I enjoy the best of both worlds in this scenario? Hmmmm?
Seasons Greetings
'RXXXXXXXXX 
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david ingram replies:
You are wasting your money.  
Of course you can have a Nevada corporation.  Any sucker that attends a seminar and signs up and pays for one can have one.
However, you are wasting your money if you think it will save you any tax.  
It will just severely hurt your pocketbook.
If you are living in Canada, the mind and control of the corporation is in Canada.  That makes your Nevada Corporation a Canadian Corporation subject to all Canadain taxes.  In addition, it is an inactive  "Holding company" in both countries which gives it a higher tax rate. azdd an extra $3,000 to 5,000 for the complication of multi-jurisdictional accounting and you have a lose / lose siituation.
Glad to help you set it up though.  We can use the money.
How about a Deleware and Grand Turks Corporation as well?
Then you can be president of three useless (to you) corporations.
Basically, under Canadian Law, for an offshore corporation to be of any value in terms of deferring or suspending Canadian tax on earnings, it must be an ACTIVE Corporation with five full time employees who are NOT related to the shareholders.
Now that I have said that, there well may be a good reason to have an offshore corporation in The Bahamas or the Turks and Caicos or Grand Cayman Islands or Bermuda.
It may serve as an Asset Protection Trust which can protect your asserts from frivolous law suits or in some cases against property settlements in a divorce.  (A Bermuda Corporation will not protect assets against a support order though as an example - every offshore country has different rules).
None of them will protect you against a concentrated attack however if it is big enough.  Two examples of that lack of protection from seizure and exposure would be Brian Mulroney's Swiss Bank Account (with $5.00 or so in it) in the Airbus Scandal fizzle and the seizure of all of David Walsh's (president of Bre X) assets in the Bahamas.  
In the case of David Walsh, he went and died before anything could happen to him but author Clifford Irving went to jail in Switzerland when it was determined by the Swiss Authorities that the money in his Secret Swiss account was paid to him for an unauthorized biogaphy of Howard Hughes.  He had said that it was an authorized biography and was paid more by the publisher, McGraw Hill.  Howard Hughes came out of a 15 year self imposed exile to repudiate the book and Cliffrod Irving spent some serious time in a Swiss Jail in a hoax that rocked the literary world.
I have written more about ofshore asset protection trusts at www.centa.com click on [newsletters], click on [1995] and click on [November] for some reasons to have them.
Hope this helps 
David Ingram's US/Canada Services
US / Canada / Mexico tax and working Visa Specialists
US / Canada Real Estate Specialists
108-100 Park Royal South
West Vancouver,  BC, CANADA, V7T 1A2
Calls accepted from 10 AM to 10 PM 7 days a week
Res (604) 980-3578 Cell (604) 657-8451
Bus (604) 980-0321 
[email protected]
www.centa.com www.david-ingram.com
Disclaimer:  This question has been answered without detailed information or consultation and is to be regarded only as general comment.   Nothing in this message is or should be construed as advice in any particular circumstances. No contract exists between the reader & the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent financial, or real estate planner or advisor & appropriately qualified legal practitioner, tax or immigration specialist in connection with personal or business affairs such as at www.centa.com. If you forward this message, this disclaimer must be included."
This from "ask an income tax and immigration and bankruptcy expert" from www.centa.com or www.jurock.com or www.featureweb.com. Canadian David Ingram deals daily with tax returns dealing with expatriate:
multi jurisdictional cross and trans border expatriate problems  for the United States, Canada, Mexico, Great Britain, the United Kingdom, Kuwait, Dubai, Saudi Arabia, South Africa,  Thailand, Indonesia, Egypt, Antarctica,  Japan, China, New Zealand, France, Germany, Spain, Italy, Russia, Georgia, Brazil, Peru, Ecuador, Bolivia, Scotland, Ireland, Hawaii, Florida, Montana, Morocco, Israel, Iraq, Iran, India, Pakistan, Afghanistan, Mali, Bangkok, Greenland, Iceland, Cuba, Bahamas, Bermuda, Barbados, St Vincent, Grenada,, Virgin Islands, US, UK, GB, American and Canadian and Mexican and any of the 43 states with state tax returns, etc.
  Alaska,  Alabama,  Arkansas,  Arizona,  California,  Colorado, Connecticut,  Delaware, District of Columbia,  Florida,  Georgia,  Hawaii,  Idaho,  Illinois,  Indiana,  Iowa,  Kansas,  Kentucky,  Louisiana,  Maine,  Maryland,  Massachusetts, Michigan, Minnesota,  Mississippi,  Missouri,  Montana,  Nebraska,  Nevada, New Hampshire,  New Jersey, New Mexico,New York, North Carolina,  North Dakota,  Ohio,  Oklahoma,  Oregon. Pennsylvania,  Rhode Island,  South Carolina,  South Dakota, Tennessee,  Texas,  Utah, Vermont,  Virginia, West Virginia, Wisconsin, Wyoming, British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec City, New Brunswick, Prince Edward Island, Nova Scotia, Newfoundland, Yukon and Northwest and Nunavit Territories,  Mount Vernon, Eumenclaw, Coos Bay and Dallas  Taxman and Tax Guru Your name has been added to our email list because of an enquiry we have received,  we may not answer your question but 
another similar question will be as we lump them.
You may find more answers at www.centa.com
David Ingram of the CEN-TA REALTY  Group
US / Canada / Mexico tax and working Visa Specialists
US / Canada Real Estate Specialists
108-100 Park Royal South
West Vancouver, BC, CANADA, V7T 1A2
(604) 980-0321 - Fax 913-9123 [email protected]
www.centa.com www.david-ingram.com
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