Canadian International Taxation: Income Tax Rules for Non-Residents

By George Gonzalez

Are you a Canadian who is planning to move overseas, or is already doing so? If so, there are special Canadian income taxation rules that you should know about.

 

In this book you'll learn about:

• The four phases of internationalization in an individual's "tax life"
• Two key fundamentals that establish how Canada may tax your Canadian-source income
• The types of Canadian-source income that are subject to the Canadian withholding tax
• How the withholding tax rate of 25% may be reduced if you reside in a tax treaty country
• Special elections that may be made with some types of income subject to withholding that may reduce that amount of taxes paid to the CRA
• The "departure year" rules and the so-called "departure tax" that apply to Canadian residents in the year they change their residency to another country

 

Are you a non-resident of Canada who receives Canadian-source income such as CPP and other government pension income, RRSPs and/or other registered retirement plans, dividends from Canadian corporations, or rental income from Canadian real property? If so, this book will help you understand how Canada taxes your income, and you will also learn about options to help you minimise your Canadian tax bill.

 

This book is written for Canadian non-residents. Canadians who still reside in Canada, and are considering a relocation to another country in future, may also be interested in my other book, Canadian International Taxation: Income Tax Rules for Residents.

 

Length: 39 pages

• Language: English
• Publisher: GCGCPA Press
• Release date: Sep 24, 2022
• ISBN: 9781777771041

Book preview

Cover_Front-Non_Residents.jpg

Copyright © 2022 George C. Gonzalez

All rights reserved. No part of this book may be reproduced in any form or by any electronic or mechanical means, including information storage and retrieval systems, without permission in writing from the publisher, except by reviewers, who may quote brief passages in a review.

ISBN 978-1-7777710-4-1 (ebook edition)

ISBN 978-1-7777710-6-5 (paperback edition)

Book design by Judy Westcott, University of Lethbridge Printing Services

eBook layout by Jan Westendorp, Kato Design and Photo

Published by GCGCPA Press

272-1500 14th Street SW

Calgary, Alberta T3C 1C9

The information provided herein is believed to be accurate and reliable as of the date of publication. Tax laws are complex and subject to frequent change, however. The author and publisher cannot accept any liability for the tax consequences that may result from acting based on the contents of this article. Any tax planning points suggested in this publication should be acted upon only after consulting with your tax advisors.

Contents

About this Book

About the Author

Preface

Chapter I. Introduction

A. Phases of Internationalization

B. Foreign Taxes

Chapter II. Two Key Income Tax Fundamentals

A. Tax Residency

1. Residency in General

2. Residency Tests

a. Factual Residence

b. Deemed Residence

3. Provincial Residency

B. Tax Treaties

C. Chapter II Summary

Chapter III. Income Taxation of Non-Residents

A. Income Subject to Tax Withholding – in General

B. Income Subject to Tax Withholding – Pension Income

1. Pension Income Payments: Tax Withholding versus Tax Return

2. Pension Income Payments: Electing to File a Tax Return Under Section 217

3. Pension Income Payments: Reduction of Amounts Withheld

C. Income Subject to Tax Withholding – Rental Income

1. Rental Income Payments: Tax Withholding versus Tax Return

2. Rental Income Payments: Electing to File a Tax Return Under Section 216

3. Rental Income Payments: Reduction of Amounts Withheld

D. Recovering Excess Taxes Withheld

E. Business Income

F. Chapter III Summary

Chapter IV. Income Taxation in the Departure Year

A. How the Departure Tax Works

B. Election to Defer Payment of the Departure Tax

C. Election to Treat Non-Taxable Property as Taxable for the Departure Tax

D. Chapter IV Summary

Chapter V. Conclusion

About this Book

Are you a Canadian who is planning to move overseas, or is already doing so? If so, there are special Canadian income taxation rules that you should know about.

In this book you’ll learn about:

The four phases of internationalization in an individual’s tax life

Two key fundamentals that establish how Canada may tax your Canadian-source income

The types of Canadian-source income that are subject to the Canadian withholding tax

How the withholding tax rate of 25% may be reduced if you reside in a tax treaty country

Special elections that may be made with some types of income subject to withholding that may reduce that amount of taxes paid to the CRA

The departure year rules and the so-called departure tax that apply to Canadian residents in the year they change their residency to another country

Are you a non-resident of Canada who receives Canadian-source income such as CPP and other government pension income, RRSPs and/or other registered retirement plans, dividends from Canadian corporations, or rental income from Canadian real property? If so, this book will help you understand how Canada taxes your income, and you will also learn about options to help you minimise your Canadian tax bill.

This book is written for Canadian non-residents. Canadians who still reside in Canada, and are considering a relocation to another country in future, may also be interested in my other book, Canadian International Taxation: Income Tax Rules for Residents.

About the Author

George Gonzalez