Common Law Option C Printout Question

[JamesSparrow]

Hey everyone!

So the time has come for me to apply my common law partner and it's asking for an option c printout, here's the kicker. I've lived in the UK with her for the passed two years so unable to provide this. With all the documents showing I lived in the UK to back up not providing it and a letter of explanation should this be okay?

 

[canuck_in_uk]

Hi

Yes, many people who have lived outside of Canada for several years have not submitted an Option C. You could include your UK P60 along with the letter of explanation.

 

[etienbjel]

The most recent Option C can't hurt. Even if it says $0 income for 2013/2014, it still provides CIC with verifiable information on your identity. I would submit regardless.

 

[Jonesy319]

It's also my understanding that as a Canadian citizen, regardless of where you live in the world, if you intend to go back to Canada to live at any point you need to continue to submit your earnings information and taxes; to the government.

My Canadian accountant told me this: I have been living in the UK since Dec 2012, in 2013 I flew back to Canada three times before I got a full time job in the UK.

For the tax year 2013 I filed both my Canadian and UK earnings to the Canadian government. There's an amnesty between certain countries so you don't pay twice on your taxes. I did owe a small amount because I hadn't paid any tax on my Canadian earnings.

I am hoping to return to Canada later this year with my partner (we submitted our application in December) and I will submit my UK earnings to the Canadian government for 2014, in April of this year. I am assuming I will not owe the Canadian government any taxes but by doing this I am proving I am still a Canadian citizen.

Suggest you talk to an accountant!
Jonesy

 

[spyro02]

Whether you need to pay taxes in Canada has nothing to do with your citizenship. Regardless of whether you are a Canadian citizen, if you are not a tax resident in Canada, you only pay taxes to Canada on your Canadian-source earnings.
A lot of people get confused between residence and citizenship. The only 2 countries in the world that tax their citizens abroad are the United States and Eritrea. I don't know why so many people in Canada get so confused about it? Maybe it's the influence from the Quebec French language, which does not differentiate between residents and citizens (both of which they call "citoyens")
It's not called a tax amnesty, it's a treaty to avoid double taxation. It's based on the principle that taxes should only be paid once on the same income, not on forgiveness. They are useful to you in 2 situations: 1. You are a resident of Canada and earned income abroad. 2. You are not a resident of Canada and earned income in Canada. In both of these cases, you get a credit in Canada for all taxes paid abroad in treaty countries.
If and what return you need to file in Canada is determined by whether you are a factual resident, deemed resident or non-resident of Canada for the tax year. If you spent most of the tax year outside Canada, you can only be a deemed resident or a non-resident. If you maintain sufficient ties to Canada, you file a deemed resident return with Canada (no provincial taxes). If you have no ties (no car, house, driver's license, other significant property) left in Canada, you are a factual non-resident of Canada and then you have to file a non-resident return only if you had any source income in Canada. If you file in the wrong category, they can reassess you in the proper one, regardless of citizenship.
Summed up, a tax return is not the place to prove your citizenship (attempting so may be grounds for a fine). You maintain citizenship in Canada regardless of whether you filled an income tax return, except if you explicitly renounced citizenship. To prove your citizenship, you need to keep your birth certificate or citizenship certificate in a safe place.

 

[Jonesy319]

Thanks Spyro,
I am now decidedly confused and have sent an email to my Canadian accountant.

I was under the illusion that if you ever wanted to return to Canada you had to report your world-wide income every year.

I am trying to find the email which led me to this conclusion (from my accountant a year or so ago) - I could have misconstrued it entirely. I understood that If you didn't want to return to Canada you could sever all ties by not doing a tax return and making a declaration. As you say this has to do with tax versus citizenship but I wondered whether not presenting a world-wide tax return it might harm the chances of being a sponsor, if they are living outside Canada.

I do not own property but I do have a storage unit and the address used for my tax return is that of my ex business partner, in Canada, although they know I am in the UK.

I will let you know, if you're interested, what my accountant says.

You seem to have a lot of knowledge - are you in that line of work?

Jonesy

 

[canuck_in_uk]

I was under the illusion that if you ever wanted to return to Canada you had to report your world-wide income every year.

As a person who lived outside of Canada for many years, I can say that that is wrong. You are not required to file taxes in Canada if you are not considered a resident for tax purposes. Whether you've filed taxes or not on your worldwide income has NO IMPACT on returning to Canada.

 

[Jonesy319]

Thank you Canuck in UK, I will wait and see what my accountant says and how I managed to get the information wrong!

Jonesy

 

[etienbjel]

Your accountant obviously wants to retain your business. UK and Canada have a double taxation treaty. It is your choice whether you want to file your taxes or not. I spent 6 years in Ireland, didn't file a single tax year. Then I came back. No issues other then trying to remember my SIN. The CRA even gave me a huge refund they owed me from before I left.

But back to the OP, just submit the Option C. Better to provide more than less.

 

[Jonesy319]

Turns out my accountant is not simply trying to keep my business but my situation was different because I have always intended to return but not sure when.

I have now had it explained to me by some of you on here (thank you) and my accountant - essentially my status was kept as resident for 2013 in case I was going back that year (in case things didn't work out with my common law partner here in the UK I kept my apartment on for insurance!).

I maintained a rented apartment until July 1. For my 2014 return my status will be non-resident. Because we intend to return this year I will continue to submit my taxes to CRA but because of the treaty I won't be paying further taxes to Canada.

Sorry to mislead the thread - glad it's all cleared up for everyone!
Jonesy