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Old 22.01.2015, 20:02
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Tax question for Canadian

Hi all!

I am french Canadian and recently started a new job at eawag/University of Zurich (2 years contract - B residency permit).

I just recently got a bit freaked out by the perspective that I would have to pay taxes in Canada as if I would be living there. I know that there is a Canada-Switzerland agreement on double-taxation, but I was told that mainly what it does is that you have tax credits for the amount of taxes you already payed in Switzerland, but then you still have to pay the rest of the money to Canada as if you would live there. The thing is you fit a Swiss salary within the Canadian tax brackets, you might as well end up living under an overpass in Switzerland (i.e., it does not consider at all the differences in the cost of living, but also that living abroad I am not using the public services for which I am asked to pay for).

I would just like to ask other fellow Canadians on this blog if this is effectively the case or if I am wrong and if so how it works based on your experience?

thanks!
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Old 22.01.2015, 20:25
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Re: Tax question for Canadian

It works that way for Americans, NOT Canadians.

My kids and late wife are/were Canadians (among other things).

Unless, of course, you are still resident in Canada.

Tom
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Old 22.01.2015, 22:28
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Re: Tax question for Canadian

There are tie breaking tax rules that you should check with the CRA for non-resident Canadian citizens. If you don't want to pay taxes in Canada you need to ensure you break your residential ties. The CRA has a list of those rules on their website so it should be able to give you the information you need for your circumstances. For whatever reasons if you still want to maintain your home and ties in Canada then you'll need to file taxes there too.
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Old 22.01.2015, 22:54
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Re: Tax question for Canadian

Like Swissish said, you need to break residency ties. In my case, that implied doing nothing.

It's not hard. When I left Canada, I even left open my personal bank account, I think I still have a credit card there. The main things are ties that would imply you are actually living there: own property, lots of assets be it monetary or a fleet of boats and cars, etc.

Go here: http://www.cra-arc.gc.ca/tx/nnrsdnts...html#rsdncstts It's extremely clear.

FYI, it says having a passport, drivers license, etc, can qualify. I think that's if it really gets down to the wire.

I left, never owned a home or anything significant in Canada, and didn't really do anything to "cut" my ties.

Further reading: http://www.cra-arc.gc.ca/tx/tchncl/n...f1-c1-eng.html

And you can ask the CRA yourself http://www.cra-arc.gc.ca/E/pbg/tf/nr73/README.html
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Old 22.01.2015, 23:44
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Re: Tax question for Canadian

I did the forms a few years ago, it's easy.

Give back your drivers license, Medicare card, cancel your gym memberships, sell any property or cars you have.

In CH get a credit card, get a bank account, switch over your license, show proof of a language class, say you're part of an expat group, say you joined a gym, are a member at the library. Prove you have established more ties here than in Canada.

I also kept my bank account (said I was repaying my student loan) and credit card. The big ticket items are major RRSPs, houses and lots of money in the bank.
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Old 23.01.2015, 02:47
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Re: Tax question for Canadian

Hi everyone,

thanks for your quick replies!

I was not clear what residency ties meant because the whole concept of it just seems so subjective to me! If I decide I have no ties and in 10 years the CRA reviews my tax forms and decide that I had residency ties.....

Like JanerMacP, I have to pay a student loan, so I am glad to hear that it does not count as a tie.

Except for a family and a mailbox at my parent place, I do not have any ties that I can see. I'll see how I can withdraw from the public health care, driver's license etc...

thanks all!
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Old 09.03.2016, 17:31
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Re: Tax question for Canadian

Bumping this because I can't figure out the following on my own:

How did you, as a emmigrated Canadian, file your first non-resident tax return? I can't submit via Ufile since I am a NR. Nor throught the CRA online options.
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Old 07.04.2016, 15:55
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Re: Tax question for Canadian

Paper forms if your situation isn't "mainstream". E-file won't work or will be very frustrating to figure out if your situation is exceptional.

If your (Canadian) income is simple, with taxes withheld at (Canadian) source, I think it's easier to fill out the paperwork, attaching supporting documents and maybe a short letter. A call to CRA might also come in handy to further clarify any misunderstandings or questions you might have.

As far as I understand, the NR4 slip is proof of TAXED income for non-resident Canadians, and it needs to be filed as part of your documents. Should you be out of the country for longer than 5 years, you can elect to file form NR5 once every 5 years - you have to apply for it, or you can continue to file your regular yearly tax forms. Check it out and see if NR5 suits your needs.

http://www.cra-arc.gc.ca/E/pbg/tf/nr5/nr5-15e.pdf
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