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Date: Saturday April 24, 2004
Time: 01:54 PM -0700
QUESTION:
I am currently working in North Carolna on a TN visa. I have been here since July 2002. I no longer own any property in Canada. I have a bank account there as well as some mutual fund investments. Do I still need to file Canadian income tax?
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david ingram replies:
You should tell your mutual fund dealer and your bank that you are a non-resident of Canada and have them withhold 10% tax on interest and 15% tax on any dividends. If they do that, you do not have to file a tax return.
If that was not done for 2003, you should file a return under Articles XI (10%) AND x (15%) TO PAY CANADA ITS TAX ON ANY INTEREST AND DIVIDENDS YOU RECEIVED. There is no Canadian Tax on capital gains for a non-resident.
However, you should also have filed a T1161 to report your Mutual funds when you left and a T1243 to report and deemed disposition taxes you might owe. The penalty for leaving the country without filing a T1161 to report your mutual funds is - drum roll please - $25.00 a day to a maximum of $2,500. Technically, you are already liable for a $2,500 Canadian fine.
You should straighten this up as soon as possible. If you do file it yourself with a request to the FAIRNESS COMMITTEE, you can likely avoid the penalty. If the CRA catches it, you will have a two or three year old penalty PLUS interest.
Get it fixed. We can help - contact numbers are below. Wait until May 5th or so please.
David Ingram's US/Canada Services
US/Canada/Mexico Tax Immigration & working Visa Specialists
US / Canada Real Estate Specialists
4466 Prospect Road
North Vancouver, BC, CANADA, V7N 3L7
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
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