QUESTION: I've just found this website and am so pleased to see the information available. I would really appreciate your advise. Scenario: * Husband Canadian, non-resident for many years, lived and worked in US for some years, has been working as consultant in Canada for about 2 months now, starting work with Canadian company as staff shortly. * Wife foreigner, will be applying for PR after moving to Canada to be with husband, currently on visitor status when visiting. * Selling rental property in US, proceeds to be remitted to Canada to buy residence and possibly a small rental property. We will be paying the appropriate taxes in US. What about in Canada ? 1) Will capital gains tax be imposed on proceeds from sale of house ? If so, at what rate and on what amount ? 2) Is foreign tax credit applicable ? * E.g. if capital gains is $100K, would Canadian tax be on $100K or $50K and is US tax paid deductible from the tax amount ? 3) Can the property be considered primary residence and not be subject to tax ? 4) If proceeds from sale of house is transferred to wife's name, will this make any difference tax-wise ? 5) Any point in setting up an immigrant trust ? 6) What is the best way to transfer money in US to Canada ? Any forms or reporting required ? That's a lot of questions but I'm new to Canadian taxes, … and I'm sure lots has changed since my husband was a resident. Thank you in advance. ======================================= david ingram replies: When the husband returned to Canada to work and the decision was made to move to Canada there was a deemed disposition and reacquisition of the property at its value that day. If the property sells 1 year later, Canada has the right to tax any capital gains or rents from the day that he crossed the border to live. Since you are already paying the US tax, any tax paid on the small percentage of the profit "AFTER" the return to Canada is now a foreign tax credit on the Canadian tax return. Although an unusual situation for 49 out of 50 tax consultants, we likely do 50 of these a year and can look after the US Federal, US State and Canadian returns and would be glad to handle them by email, snail mail, fax or courier or in person. Canada taxes 50% of the gain at whatever tax rate you have reached while the US has a lower tax rate. At the top end of the spectrum of profits, the tax is usually about the same. Answers to this and other similar questions can be obtained free on Air every Sunday morning. Every Sunday at 9:00 AM on 600AM in Vancouver, I, david ingram am a permanent guest on Fred Snyder of Dundee Wealth Managers' LIVE talk show called "ITS YOUR MONEY" Those outside of the Lower Mainland will be able to listen on the internet at www.600AM.com <http://www.600am.com/> Call (604) 280-0600 to have your question answered. BC listeners can also call 1-866-778-0600. Callers to the show and questioners on this board can also attend the Thursday Night seminars on finance and making your Canadian Mortgage Interest deductible. David Ingram's US/Canada Services US / Canada / Mexico tax, Immigration and working Visa Specialists US / Canada Real Estate Specialists Home office at: 4466 Prospect Road North Vancouver, BC, CANADA, V7N 3L7 Cell (604) 657-8451 - (604) 980-0321 Fax (604) 980-0325 Calls welcomed from 9 AM to 9 PM 7 days a week (please do not fax or phone outside of those hours as this is a home office) email to taxman at centa.com <mailto:taxman at centa.com> www.centa.com <http://www.centa.com/> www.david-ingram.com <http://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 and the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent and appropriately qualified legal practitioner or tax specialist in connection with personal or business affairs such as at www.centa.com <http://www.centa.com> . If you forward this message, this disclaimer must be included." Be ALERT, the world needs more "lerts" This from "ask an income tax and immigration expert" from www.centa.com <http://www.centa.com/> or www.jurock.com <http://www.jurock.com/> or www.featureweb.com <http://www.featureweb.com/> . David Ingram deals on a daily basis with expatriate tax returns with: multi jurisdictional cross and trans border expatriate problems for the United States, Canada, Mexico, Great Britain, the United Kingdom, Kuwait, Dubai, Saudi Arabia, Thailand, Indonesia, 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, and any of the 43 states with state tax returns, etc. Rockwall, Dallas, San Antonio and Houston Texas Denmark, Finland, Sweden Norway Bulgaria Croatia Income Tax and Immigration Tips, Income Tax and Immigration Wizard Income Tax and Immigration Guru Income Tax and Immigration Consultant Income Tax and Immigration Specialist Section 216(4) 216(1) NR6 NR-6 NR 6 Non-Resident Real Estate tax specialist expert preparer consultant expatriate anti money laundering money seasoning FINTRAC E677 E667 105 106 TDF-90 Reporting $10,000 cross border transactions Alaska, Alabama, Arkansas, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Garland, 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. 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CEN-TA Cross Border Services - Tax, Visas, Immigration
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