Bringing money into Canada as an immigrant

[snoopy719]

Hello All,

I have been a PR for several years now. I had an apartment back in my home country that I wasn't able to sell before coming to Canada. The apartment has just been sitting there, and has not been generating any income for me. I have now finally been able to sell it for about $150K CAD. Now, I am wondering what is the best way to bring this money into Canada. Would I be required to pay income tax on this amount? Or, would I have to pay capital gains tax? I bought the apartment about two years before becoming a PR, and have owned it for a total of 6 years. It hasn't gained that much in value---it has gained perhaps $20K CAD or less. So, if I had to pay capital gains tax, I suppose it would be that much. But, would I have to pay capital gains, if it is property that I have owned since before becoming a PR?

I assume that if I were to simply do a bank transfer from my overseas account to my account in Canada, it would a CRA investigation, right? I have transferred large amounts by bank transfer before (about $200K), but that was during my first year as a PR, and that did not trigger any interest from CRA.

Does anybody have experience with this?

Snoopy

 

[emamabd]

Hello All,

I have been a PR for several years now. I had an apartment back in my home country that I wasn't able to sell before coming to Canada. The apartment has just been sitting there, and has not been generating any income for me. I have now finally been able to sell it for about $150K CAD. Now, I am wondering what is the best way to bring this money into Canada. Would I be required to pay income tax on this amount? Or, would I have to pay capital gains tax? I bought the apartment about two years before becoming a PR, and have owned it for a total of 6 years. It hasn't gained that much in value---it has gained perhaps $20K CAD or less. So, if I had to pay capital gains tax, I suppose it would be that much. But, would I have to pay capital gains, if it is property that I have owned since before becoming a PR?

I assume that if I were to simply do a bank transfer from my overseas account to my account in Canada, it would a CRA investigation, right? I have transferred large amounts by bank transfer before (about $200K), but that was during my first year as a PR, and that did not trigger any interest from CRA.

Does anybody have experience with this?

Snoopy

Did you declare owning the property during your previous years tax returns? (you are expected to declare any property you own overseas of value $100k+) when filing your tax...if you did, you shouldn't worry about any investigation, cause CRA already knows you own it, so no surprises here.

 

[snoopy719]

Did you declare owning the property during your previous years tax returns? (you are expected to declare any property you own overseas of value $100k+) when filing your tax...if you did, you shouldn't worry about any investigation, cause CRA already knows you own it, so no surprises here.

No, I did not. It wasn't generating any income (I wasn't renting it out or anything) and I wasn't sure my family would allow me to sell it, so I did not declare it anywhere.

 

[alok4best]

Did you declare owning the property during your previous years tax returns? (you are expected to declare any property you own overseas of value $100k+) when filing your tax...if you did, you shouldn't worry about any investigation, cause CRA already knows you own it, so no surprises here.

There is no requirement to declare it if it is not an investment property.

@snoopy719 . I think best to work this with a CA, but my understanding is that you would be paying taxes on your capital gains. Now keep it mind that technically cap gains are also taxed in India unless you invest the profits again into something else. So double taxation treaties would also come in to play. Better not to tackle this on your own.

 

[PMM]

Hi

There is no requirement to declare it if it is not an investment property.

@snoopy719 . I think best to work this with a CA, but my understanding is that you would be paying taxes on your capital gains. Now keep it mind that technically cap gains are also taxed in India unless you invest the profits again into something else. So double taxation treaties would also come in to play. Better not to tackle this on your own.

1. Wrong Wrong Wrong, you have to declare any assets abroad over $100k to CRA whether it is an investment property or not. The OP would pay capital gains tax on the difference between the value of the apartment on the day he became resident for tax purposes and the day that it was sold.

"If you own foreign property with a cost in excess of $100,000 at any period during the year, you must make an annual disclosure with the Canada Revenue Agency. This property includes bank accounts, stocks, bonds and real estate. Even if you have stocks and bonds held in Canadian brokerage accounts, you need to report them. You make the declaration on Form T1135, Foreign Income Verification Statement. “Form T1135 requires detailed information about your foreign property, including income generated, location and maximum cost during the year,” “Penalties of $25 per day, up to $2,500 per taxpayer, are payable for non-disclosure or late filing.”

 

[alok4best]

Hi



1. Wrong Wrong Wrong, you have to declare any assets abroad over $100k to CRA whether it is an investment property or not. The OP would pay capital gains tax on the difference between the value of the apartment on the day he became resident for tax purposes and the day that it was sold.

"If you own foreign property with a cost in excess of $100,000 at any period during the year, you must make an annual disclosure with the Canada Revenue Agency. This property includes bank accounts, stocks, bonds and real estate. Even if you have stocks and bonds held in Canadian brokerage accounts, you need to report them. You make the declaration on Form T1135, Foreign Income Verification Statement. “Form T1135 requires detailed information about your foreign property, including income generated, location and maximum cost during the year,” “Penalties of $25 per day, up to $2,500 per taxpayer, are payable for non-disclosure or late filing.”

You need to read CRA articles completely.
From official links:
https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/foreign-reporting/foreign-income-verification-statement.html

Specified foreign property does not include:

• a property used or held exclusively in carrying on an active business;
• a share of the capital stock or indebtedness of a foreign affiliate;
• an interest in a trust described in paragraph (a) or (b) of the definition of exempt trust in subsection 233.2(1);
• a personal-use property as defined in section 54; and
• an interest in, or a right to acquire, any of the above-noted excluded foreign property.

The actual T1135 form. Check page no 5, question no 5.
https://www.canada.ca/content/dam/cra-arc/migration/cra-arc/E/pbg/tf/t1135/t1135-17e.pdf

Once more, question no 6 here:
https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/foreign-reporting/questions-answers-about-form-t1135.html

They all state that there is no requirement to declare a personal use property.