Bringing in property sale proceeds from abroad
- Thread starter seekr
- Start date
Hi all,,,
I landed as PR in 2019, got PR card and left after 1 month. Now i am planning to shift permanently by next year.
I have few properties back home for me and my spouse and some are inherited. All are before 2019. The collective price of all is more than 100k.
1- when should I declare these properties? As there was no such column in EE ?
2-how can we transfer our EOS to Canada moving permanently there, is there any tax on it?
3- if i plan to sell these properties e-g after 2 yrs, there ll be tax on my money while transfer to Canada?as we ll pay capital gain tax in our country while selling.
4- while declaring property we have to tell the estimated price? e-g if it’s cost is 150k and i sell it at 170k , i have to pay tax on difference only?
I landed as PR in 2019, got PR card and left after 1 month. Now i am planning to shift permanently by next year.
I have few properties back home for me and my spouse and some are inherited. All are before 2019. The collective price of all is more than 100k.
1- when should I declare these properties? As there was no such column in EE ?
2-how can we transfer our EOS to Canada moving permanently there, is there any tax on it?
3- if i plan to sell these properties e-g after 2 yrs, there ll be tax on my money while transfer to Canada?as we ll pay capital gain tax in our country while selling.
4- while declaring property we have to tell the estimated price? e-g if it’s cost is 150k and i sell it at 170k , i have to pay tax on difference only?
1. Depends what you do with those properties, if those are rentals or vacant. You will need to declare the income on those properties as well as each year, file form T1135 when filing your taxes.
2. no issue, no tax on money earned prior to becoming tax resident of Canada (soft landing does or acquiring PR does not make you tax resident, it depends on ties, but generally, it is when people move to settle in Canada.
3. Not when you transfer, when you sell. You will pay capital gain tax in Canada as well (but only on the portion between when you become a tax resident and when you sell.
4. You will pay tax on difference but it is not just what you estimate the cost to be. It is the value at the time you become a tax resident of Canada.
The difficulty in all that is to determine that value, and it is just not what you decide or feel like it should be, you'll need strong evidence of that cost. CRA will always look to maximize the tax.
You will have to hire a tax specialist to best determine what your options would be, again, you owe taxes on ALL income and capital gains worldwide once you become a tax resident of Canada, you need to declare the income not necessarily your assets.
Hi. So same situation. Landed as student 2013, became PR 2017 and have not declared I had a house because I i let HR do my taxes and they never brought it up. I received the house as a gift from my parents 2008 and I believe the value was less than 100k back then.
The thing is for my origin country there isn't a fair market value guidance. There are govenrment zonal values but no one follows them, they are either too high or too low. I looked up the zonal value and only 2019 was available and it looks like the house is around 180k. I don't think its fair market value tho. My mom's opinion it could be less.
I wont be selling the house for another 10 years as my mother is living in it.
What can I do now to correct this? Is there a tax specialist that i should be looking for?
I'm really concerned about the penalty. I do not have (2,500 x 4 years) 10k right now to spare.
The thing is for my origin country there isn't a fair market value guidance. There are govenrment zonal values but no one follows them, they are either too high or too low. I looked up the zonal value and only 2019 was available and it looks like the house is around 180k. I don't think its fair market value tho. My mom's opinion it could be less.
I wont be selling the house for another 10 years as my mother is living in it.
What can I do now to correct this? Is there a tax specialist that i should be looking for?
I'm really concerned about the penalty. I do not have (2,500 x 4 years) 10k right now to spare.
I have some questions.
1. How do you determine FMV. I landed in 2010 and did not think about FMv at the time. Now I am planning to sell and wondering how to determine that?
2. Which form to report the sale?
3. Do we still need to report the sale if we sold at a loss (Current price - FMV = negative)
Thank You
3) Yes, you can have a capital loss, so as to offset any future gains. You report the sales and loss in your T1. I suggest you hire an accountant or tax preparer.
I have a similar question. I used to be a Canadian citizen and work overseas for 15 years. I moved back to Canada recently. I have sold my primary property overseas after I have moved back to Canada. Do I need to pay any tax when I move money back to Canada?
My question to you is where do you live after moving back to Canada? Are you renting or bougth the house/condo in Canada? If you live in your home in Canada - that's your primary property, and whatever is/was overseas is not primary property anymore, right? I do not think this forum can give you legal advise . But, what do I know?
Thanks for all the info posted here! It's been an interesting read, and I had a question of my own (although it's probably much more straightforward than other posters').
I'm a dual Canadian and German citizen, and a resident (for tax purposes and in general) of Canada.
My dad (a German resident and tax payer) passed on a rental property in Germany he'd inherited from his mom some time back, because looking after it became a constant headache for him.
The whole deal was notarized just now, end of December 2023, with my brother and me now owning the property jointly 50/50. Neither of us is in a position to look after a German rental, so we'll be selling the place within the next few months (if all goes as expected); the condo is currently not rented out, and there's been no rental income since it changed hands.
We already have a potential buyer, and the expected selling price of the property is already on file in the paperwork prepared by the notary at the time.
As regards the German side of the equation: The per-person gains amount is well below the limits triggering inheritance taxation in Germany, as confirmed by our notary. German tax authorities need to be be made aware, but that's pretty much it.
For Canada: Since my slice of the flat, once sold, exceeds CAD 100k, I'll have to declare ownership via the Foreign Income Verification Statement (T1135 E) in my 2023 tax filings.
As far as I understand at this point, there are no taxes to be paid on an inheritance (even if it"s "inter vivos"), and any potential taxes that are due in Canada would be capital gains on any appreciation of the value of the property between the time I became part-owner and the time I sell it. In the current circumstances and the expected time frame, this will likely be none at all.
Once everyting is done and dusted, I'll do an inter-bank or wire transfer from a German to my Canadian bank, and I expect to be using the money for a down payment on a property in Canada.
Is there any paperwork that I need to file, other than the T1135 E, to make sure that everything is above board with the CRA and my bank?
Thanks a lot for all the great advice on this forum and the knowledgeable folks volunteering their time!
I'm a dual Canadian and German citizen, and a resident (for tax purposes and in general) of Canada.
My dad (a German resident and tax payer) passed on a rental property in Germany he'd inherited from his mom some time back, because looking after it became a constant headache for him.
The whole deal was notarized just now, end of December 2023, with my brother and me now owning the property jointly 50/50. Neither of us is in a position to look after a German rental, so we'll be selling the place within the next few months (if all goes as expected); the condo is currently not rented out, and there's been no rental income since it changed hands.
We already have a potential buyer, and the expected selling price of the property is already on file in the paperwork prepared by the notary at the time.
As regards the German side of the equation: The per-person gains amount is well below the limits triggering inheritance taxation in Germany, as confirmed by our notary. German tax authorities need to be be made aware, but that's pretty much it.
For Canada: Since my slice of the flat, once sold, exceeds CAD 100k, I'll have to declare ownership via the Foreign Income Verification Statement (T1135 E) in my 2023 tax filings.
As far as I understand at this point, there are no taxes to be paid on an inheritance (even if it"s "inter vivos"), and any potential taxes that are due in Canada would be capital gains on any appreciation of the value of the property between the time I became part-owner and the time I sell it. In the current circumstances and the expected time frame, this will likely be none at all.
Once everyting is done and dusted, I'll do an inter-bank or wire transfer from a German to my Canadian bank, and I expect to be using the money for a down payment on a property in Canada.
Is there any paperwork that I need to file, other than the T1135 E, to make sure that everything is above board with the CRA and my bank?
Thanks a lot for all the great advice on this forum and the knowledgeable folks volunteering their time!
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