Canadian government require of Canadian Citizens living abroad for long time

[newemployee909090]

I am a person of Indian origin who recently acquired Canadian Citizenship and Canadian passport.

I will be returning to India in order to reside in India for a number of years.

I have No Canadian property, No Canadian Stocks/Shares

However, I do have a Savings Bank Account that gives a yearly interest of around less than 5%.



1) Do I have to file Canadian Income Tax returns for the Savings Bank Account?

2) Furthermore, do I have to keep the Canadian government that I, as a Canadian citizen, am residing outside of Canada for an extended period of time?

3) Basically, I'm asking "What does the Canadian government require of Canadian Citizens living abroad for a lengthy period of time?"

(The reason I'm asking is that the US government is very strict with US citizen who live outside the US for an extended period of time. For example, US Citizens regardless of whether they are outside the US have to declare Non-US income by filing US tax forms. Also, I've heard US citizens have to file some kind of report every 6 months or so to the US government indicating that they are continuing to reside outside the US. )

Thanks in advance

 

[bambino]

They will likely also want a good chunk of any income you earn in India. This is strictly a tax question, and not one about immigration. It has nothing to do with your status as a citizen but rather whether you are deemed a resident of Canada for tax purposes.

 

[alphazip]

I'm a U.S. citizen living permanently in Canada, and I certainly don't let the U.S. know every 6 months that I'm here. However, I do have to file U.S. income tax returns for the rest of my life.

In your case, you should file a departing Canadian return. After that, you shouldn't have to pay Canadian taxes unless you retain ties to Canada, such as leaving property or a spouse behind.

Other than your tax obligation, there is no requirement to notify Canada where you will be living or how long you'll be gone.

 

[raymasa]

I'm a U.S. citizen living permanently in Canada, and I certainly don't let the U.S. know every 6 months that I'm here. However, I do have to file U.S. income tax returns for the rest of my life.

In your case, you should file a departing Canadian return. After that, you shouldn't have to pay Canadian taxes unless you retain ties to Canada, such as leaving property or a spouse behind.

Other than your tax obligation, there is no requirement to notify Canada where you will be living or how long you'll be gone.

I think (but please check with an accountant), if you keep your Canadian saving account, that counts as ties to Canada, which means you have to file Canadian taxes on your worldwide income. But, again that is my understanding, and please check with an accountant to be sure

Ray

 

[dpenabill]

I am a person of Indian origin who recently acquired Canadian Citizenship and Canadian passport.

I will be returning to India in order to reside in India for a number of years.

I have No Canadian property, No Canadian Stocks/Shares

However, I do have a Savings Bank Account that gives a yearly interest of around less than 5%.

1) Do I have to file Canadian Income Tax returns for the Savings Bank Account?

2) Furthermore, do I have to keep the Canadian government that I, as a Canadian citizen, am residing outside of Canada for an extended period of time?

3) Basically, I'm asking "What does the Canadian government require of Canadian Citizens living abroad for a lengthy period of time?"

(The reason I'm asking is that the US government is very strict with US citizen who live outside the US for an extended period of time. For example, US Citizens regardless of whether they are outside the US have to declare Non-US income by filing US tax forms. Also, I've heard US citizens have to file some kind of report every 6 months or so to the US government indicating that they are continuing to reside outside the US. )

As already noted by others, most of this regards tax questions, not status or immigration questions.

While I do not know the Canada Revenue laws governing who must file in much detail, I know that they are not nearly so strict as they are for U.S. citizens, who must file a U.S. return reporting worldwide income regardless of where in the world they live or for how long, regardless of the source of income. While it is more complicated, in general terms a non-resident Canadian abroad who is not required to file a resident return must file a non-resident Canadian tax return if the non-resident has income from a Canadian source (requirement may be subject to threshold minimums, but I do not know if those are based on only the Canadian source income or all income).

There are specific provisions governing which Canadians must file a tax return as a resident of Canada. If the Canadian is required to file a resident return, worldwide income must be reported.

The specific requirements regarding who must file a resident return, and who must file a non-resident return, and general information about what must be reported in the respective returns, should be quite easily found at the CRA website.

Violations of the Canada Revenue laws will not have any impact on a person's status as a Canadian citizen. But of course the penalties can be severe, from subtantial financial penalties up to and including criminal offences resulting in imprisonment.


Regarding notice to Canadian government of foreign address:

CIC strongly recommends that Canadians abroad report their address to the respective Canadian embassy abroad, and there is good reason to do so. Failure to do this is not a violation of any laws, regulations, or rules, but it can affect access to Embassy services for Canadian citizens abroad.

There really is no good reason to not report. Being abroad has no detrimental impact on a Canadian citizen (well, of course there are various consequences for being a non-resident in Canada, relative to benefits and services, particularly at the provincial level, but it would be criminal fraud to obtain such benefits in contravention of the residency requirements, so all one is giving up is what one must give up).


Are there other reporting requirements similar to U.S. requirements?

Note, actually the only reporting all American citizens abroad must do is (1) file a U.S. tax return, and (2) annually file a report of financial interests abroad (reporting all bank accounts, investment accounts, and so on, if the American citizen has more than $10,000 total in such foreign accounts, a fairly low threshold for anyone with any kind of savings or retirement investments).

I do not know if there is a similar requirement in Canada for reporting interest (accounts) in foreign financial institutions. I do not think there is, other than the requirements to report worldwide income as applicable, but I am not sure of this. An accountant should be able to easily answer this question.

 

[alphazip]

Yes, the OP would need to check with an accountant or the CRA to see whether having a bank account in Canada is so significant a tie to Canada that a tax return must be filed. I believe I read that it is not.

There is a CRA requirement that foreign bank accounts be reported (Form T1135), but the threshold is a more reasonable $100,000.

 

[screech339]

To be honest, I don't think having a Canadian bank account alone give you canadian ties to deemed you a resident of Canada. For example. I lived in US for 5 years. I have bank accounts as well but I am not required to file taxes since I am deems a non-resident of Canada. However I had to report the interests to US income tax as I am a US resident.

I still filed my Canadian income tax as a non-resident of Canada and my income reported in Canada is only the interest of my savings account/investment accounts there. The total income is so small I didn't need to pay any income tax.

So the OP doesn't have to file Canadian income tax because the OP is not a residence of Canada. He has the option to file anyway but have to file income tax as a Non-resident.

One other bit of information I was not aware of when I did move back. I couldn't claim any of my moving expenses in year I filed income when I moved back. As a non-resident moving back to Canada, I cannot claim moving expenses due to relocating for employment purposes. Only those who lived and filed as resident of Canada can they claim moving expenses between jobs within Canada.

Screech339

 

[dpenabill]

So the OP doesn't have to file Canadian income tax because the OP is not a residence of Canada. He has the option to file anyway but have to file income tax as a Non-resident.

A Canadian citizen living abroad who is not required to file a resident return can, indeed, exercise the option to file a return as a non-resident.

Otherwise, however, this conclusion is, I think, subject to how much income there is from the account. Small amount of income is probably below a minimum threshold (which should be easy to find at the CRA website), but a substantial income over the threshold probably requires the filing of a non-resident return (that is, required, not optional).

 

[screech339]

A Canadian citizen living abroad who is not required to file a resident return can, indeed, exercise the option to file a return as a non-resident.

Otherwise, however, this conclusion is, I think, subject to how much income there is from the account. Small amount of income is probably below a minimum threshold (which should be easy to find at the CRA website), but a substantial income over the threshold probably requires the filing of a non-resident return (that is, required, not optional).

Yes I agree, if income generated pass the threshold of having to pay taxes, would require the OP to file income tax as non-resident. That includes interests/capital gains/investments generated in accounts, and income generated from renting out house/apartment as well.

But in theory, if the income are generated in Canada while a resident in another country, the person must report the income in Canada in the home country income tax filing, since the person is a residence of that country and thus generated income while being a residence there.

Canada has a tax treaty with a lot of countries. This will allow Canadians/PRs to avoid being double taxed. So any income generated in Canada must be part of the foreign country income filing rules. So a Canadian would only have to report or file 1 income tax in country of residence. If a Naturalized Canadian or PR residing in Canada has any income generated in home country, they must include this in their Canadian income filing based on tax treaty agreements. However if a PR / Naturalized Canadian's home country does not have a tax treaty with Canada, then the person will run the risk of being double taxed on the same income.

 

[applic2013]

cra-arc.gc.ca/E/pbg/tf/nr73/README.html

If you really want to know, the best way is filling out the following form and ask CRA. To the best knowledge, you are not resident of Canada for tax purposes. Please check it out. Good luck