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I found your website and had a look through your online materials (newsletters, etc), however I was hoping to obtain your opinion on my tax status:
Let me describe the situation I'm currently in. I'm a canadian who has been working for a US company in Washington State since June of 2001. I've been under a T1 Visa for the duration of that time and I've filed my taxes as a resident of Canada (for 2001 and 2002). The reason I was filing in Canada was due to the uncertain nature of my workplace which made job security questionable.I'm currently in the process of applying to Canadian schools which would start no sooner than August of 2004. If I leave in June, I would be leaving Canada after residing in the US for no less than 3 years.
My question is: technically I fall under the ideal qualifications for a "non-resident" of Canada. If I return to Canada in the fall to attend school, is it worth it to declare myself as a non-resident for the past three years? Ideally I would be able to obtain a substantial amount of money refunded to me from Revenue Canada. However If I declare myself as a non-resident for the last three years, then return the year after, would that disqualify me from making that claim?
I have quite a bit of documentation to plead my case for being a non-resident of Canada: my car has been insured in Washington since July of 2001, (less than one month after moving to the states) this is also the same month I obtained a Washington Driver's license. I have employment records, rental leases, bank accounts, credit cards, etc which show residency in the U.S. I have no formal ties to Canada except visits to family at Christmas time.
I would be interested to see what your opinion is on my situation. Please let me know if you have any thoughts on this matter.
Thank you for your time and I hope to hear from you soon
Cheers
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david ingram replies:
No one should expect an answere back this quicly. there are three hubndred questions ahead of you but it came in as I was looking for a question to answer for our newsletter.
>From what you have shown, you were a resident of the United States and should not have paid tax to Canada under article IV of the US Canada Income Tax Convention (1980).
I would refile your Canadian returns back to 2001.
Article IV (2) reads as follows:
2. Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his status shall be determined as follows:
(a) he shall be deemed to be a resident of the Contracting State in which he has a permanent home available to him; if he has a permanent home available to him in both States or in neither State, he shall be deemed to be a resident of the Contracting State with which his personal and economic relations are closer (centre of vital interests);
(b) if the Contracting State in which he has his centre of vital interests cannot be determined, he shall be deemed to be a resident of the Contracting State in which he has an habitual abode;
(c) if he has an habitual abode in both States or in neither State, he shall be deemed to be a resident of the Contracting State of which he is a citizen; and
(d) if he is a citizen of both States or of neither of them, the competent authorities of the Contracting States shall settle the question by mutual agreement.
Also read the Judge Teskey decision in Dennis Lee at http://www.centa.com/CEN-TAPEDE/centapede/Week-of-Mon-20031124/000463.html
I would be happy to assist you with the amendments of course.
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