Cross Border Tax

[mayple]

Are there folks here who've worked remotely from within Canada and have not commuted back and forth across the border due to Covid restrictions? How are you planning to prepare your taxes for 2021 year? I've read suggestions on filing US taxes first, then Canadian. But does that sequence or the process change if one was employed in the US getting paid in the US account and paying US taxes whilst working remotely from Canada (no CRA taxes withheld)?

Also, does anyone have any recommendations for a good cross border accountant? How much is the average cost for filing taxes?Looking for an estimate/range.

 

[wink]

But does that sequence or the process change if one was employed in the US getting paid in the US account and paying US taxes whilst working remotely from Canada (no CRA taxes withheld)?

No, the process is same.

 

[Dattateja]

Are there folks here who've worked remotely from within Canada and have not commuted back and forth across the border due to Covid restrictions? How are you planning to prepare your taxes for 2021 year? I've read suggestions on filing US taxes first, then Canadian. But does that sequence or the process change if one was employed in the US getting paid in the US account and paying US taxes whilst working remotely from Canada (no CRA taxes withheld)?

Also, does anyone have any recommendations for a good cross border accountant? How much is the average cost for filing taxes?Looking for an estimate/range.

Hi I am also looking for the same info, I can't figure out if we should file tax in US as resident or non resident, any leads on cross border accountant.

 

[mayple]

Hi I am also looking for the same info, I can't figure out if we should file tax in US as resident or non resident, any leads on cross border accountant.

I've spoken with a couple of tax accountants so far, but have not yet decided on which one to hire. Everyone quoted a different price ranging from 500 CAD - 3000 CAD. The price may vary depending on the complexity of your taxes, but its an estimate. Some accountants did not feel confident about filing the US side of the taxes, and sounded more comfortable doing only the Canadian side. I'm still going to talk to a couple more since I'm waiting on my tax documents to become available before deciding who to hire. I'll keep you posted

 

[Dattateja]

I've spoken with a couple of tax accountants so far, but have not yet decided on which one to hire. Everyone quoted a different price ranging from 500 CAD - 3000 CAD. The price may vary depending on the complexity of your taxes, but its an estimate. Some accountants did not feel confident about filing the US side of the taxes, and sounded more comfortable doing only the Canadian side. I'm still going to talk to a couple more since I'm waiting on my tax documents to become available before deciding who to hire. I'll keep you posted

Thanks for the info, just a few follow up questions.

1. Are you a fulltime employee of a US company?
2. Do you have W2 for 2021?
3. Did you get paid in your US account?
4. Did your employer withheld us payroll taxes?
5. Did you go to USA at all in 2021?

Just trying to relate to my case. My answers to these questions are

1. Yes
2. Yes
3. Yes
4. Yes
5. No

Not sure will I be a resident or non resident for tax purposes in USA.

 

[mayple]

Thanks for the info, just a few follow up questions.

1. Are you a fulltime employee of a US company?
2. Do you have W2 for 2021?
3. Did you get paid in your US account?
4. Did your employer withheld us payroll taxes?
5. Did you go to USA at all in 2021?

Just trying to relate to my case. My answers to these questions are

1. Yes
2. Yes
3. Yes
4. Yes
5. No

Not sure will I be a resident or non resident for tax purposes in USA.

All answers are YES for me. Whether you are tax resident or tax non-resident for US depends on several factors including your ties to either country. When (which year) did you physically start living in Canada?

 

[Dattateja]

All answers are YES for me. Whether you are tax resident or tax non-resident for US depends on several factors including your ties to either country. When (which year) did you physically start living in Canada?

I started living in Canada since Oct 2020, didn't go to USA at all since then.

 

[mayple]

I started living in Canada since Oct 2020, didn't go to USA at all since then.

Did you file any Canadian taxes for 2020 (i know the time period was only Oct - Dec 2020, but just checking if you or not)? Also, some of the other considerations are your ties e.g. do you maintain financial ties to Canada (if so, what kind e.g. do you have investments, retirement accounts, rental investment property, where is most of your money saved, do you have a mortgage) or other ties such Canadian driver license, Canadian registered vehicle, do you have family (wife/kids, if yes are they in Canada as well) etc. All of these factors help you decide whether you should file as a Canadian resident for tax purposes or not.

 

[Dattateja]

Did you file any Canadian taxes for 2020 (i know the time period was only Oct - Dec 2020, but just checking if you or not)? Also, some of the other considerations are your ties e.g. do you maintain financial ties to Canada (if so, what kind e.g. do you have investments, retirement accounts, rental investment property, where is most of your money saved, do you have a mortgage) or other ties such Canadian driver license, Canadian registered vehicle, do you have family (wife/kids, if yes are they in Canada as well) etc. All of these factors help you decide whether you should file as a Canadian resident for tax purposes or not.

Yup I filed Canadian taxes for 2020, I will be deemed resident of Canada for sure, since all my savings are in Canada, Have a DL in Canada, Vehicle in Canada and my wife is in Canada and she is a PR.

 

[mayple]

Yes, in your case it appears you'd be a Canadian tax resident. Curious as to why you filed 2020 Canadian taxes since you most likely did not meet the threshold for filing Canadian taxes?

 

[Dattateja]

I had to because I was applying to sponsor my wife for PR and IRCC needed NOA.

 

[mayple]

I had to because I was applying to sponsor my wife for PR and IRCC needed NOA.

Thanks, makes sense. In you case, it appears you'd be filing US taxes as non-resident, and then taking those taxes paid as foreign credit to calculate your tax liability to CRA.

 

[swan0206]

I've spoken with a couple of tax accountants so far, but have not yet decided on which one to hire. Everyone quoted a different price ranging from 500 CAD - 3000 CAD. The price may vary depending on the complexity of your taxes, but its an estimate. Some accountants did not feel confident about filing the US side of the taxes, and sounded more comfortable doing only the Canadian side. I'm still going to talk to a couple more since I'm waiting on my tax documents to become available before deciding who to hire. I'll keep you posted

Hey,
Did you get to know if you can or allowed to open investment accounts here in Canada? I believe we have discussed in the other thread regarding these tax situations. Did you get to find any answer after speaking to these tax accountants? And also do you have plans to return back to US or you plan to stay here for a while. If you do , then your tax situation matches mine as you answered YES to all those questions asked by @Dattateja above!

 

[mayple]

Tax accountants did not have any specific suggestion on whether an investment account can stay open or not. From their perspective, its a matter of reporting all investment income (dividends, capital gains etc.) appropriately. Keeping the account open is a US issue, and for the most part all of the brokerage firms say they will freeze the account once the address on file is updated. I do plan to return back to the US once the border situation is resolved (no restrictions on free movement back and forth like pre-covid), I don't however have the exact date of when that will happen.

 

[swan0206]

Tax accountants did not have any specific suggestion on whether an investment account can stay open or not. From their perspective, its a matter of reporting all investment income (dividends, capital gains etc.) appropriately. Keeping the account open is a US issue, and for the most part all of the brokerage firms say they will freeze the account once the address on file is updated. I do plan to return back to the US once the border situation is resolved (no restrictions on free movement back and forth like pre-covid), I don't however have the exact date of when that will happen.

Ok. So you haven't started any stock investments here ,is that right? tillyou get to have a clear picture? as i was telling in other thread, the accountant i spoke to says, not to have those accounts open if i have plans to return back to US in 2 or 3years but i still think this can be done but not sure why did he suggested me that.