Got Canada PR: Canada Citizenship vs US Green Card: Decision Time

[dream16]

Hello Folks:

1. My Canadian PR Became active from July 2015 this year & my PR cards have arrived at friends place in Canada.

2. I am Currently in US on H1b, with Priority Date of Sep 2012 (EB2) & from the current trends, it seems it will take another 3 years minimum i.e. Oct 2018 before i become eligible to even get an EAD card, GC dates are painfully stuck at 2005 and there's rarely a hope for their progression till 2020.

3. Have you guys faced any issues renting your own home in US while you lived in Canada to become Canadian citizens after 4 years of stay? Any US or Canadian Tax Implications in this scenario? :-[

4. I am trying to evaluate what new opportunities will i open myself to in the case i move to Canada next year & then ultimately apply for canadian citizenship around May 2020? 8)

5. Does a Canadian Citizen receive special benefits if they want to come & work-live in US? Other than receiving the TN Visa, Free Healthcare, i can't seem to determine any special advantages that a Canadian Citizen will have as compared to a US Green Card Holder. Please don't take my question as negative, no offense to anyone & kudos to all of your hardwork & years of struggle as nothing comes easy.

6. Since i will have to give up my Indian Citizenship, what negative impacts will that have on my ancestral inherited property (agricultural land)? & ongoing property investments in India? Being a POI/OCI card holder of India in future will give me special privileges?

7. Are Indians who have successfully became canadian citizens filing taxes in 3 countries: US/CAN/IND? Or declaring worldwide on CAN? Or meeting US FBAR reporting requirements for taxes?

8. Are the scenarios related to RO/Delay in applying canadian citizenship (by 15+months after 4 years of stay) fairly common for H1b Indians?

Thank you for your help & going through my post.

 

[keesio]

I can't give much advice since many of the scenarios you describe do not apply to me. But one thing to consider is that as you know, all US citizen and green card holders are required to file US taxes regardless of your residency (where you live) where as Canadian citizens have the ability to declare "non-residency" status to CRA and not have to file Canadian taxes if they live abroad. If you don't plan on living in the USA long term, this is something to consider. And it is not so easy to renounce citizenship or green card status to avoid taxation. There is an exit tax which applies to citizens and long term green card holders (6+ years). As a dual (US and Canadian) citizen who has been living in Canada for 15 years, filing US taxes as a foreign resident is a major pain in the butt. It can be costly and time consuming. I always warn people who are so eager to obtain US residency to think carefully what it means in regards to taxation if they are not planning on living in the US for the rest of their life...

 

[kateg]

I would second what keesio says.

US P/R or Citizenship is largely only an asset when you live there, particularly when you have Canadian citizenship. It's a lot of work, and it follows you everywhere you go. Nearly every bank on the planet is going to make you fill out additional paperwork, and you get to tell the United States every bank account you have, the balances (if you meet a threshold), and file US taxes every year for the rest of your life (unless you renounce).

This can work out in some very negative ways. For example, if you save up in a TFSA (which Canada considers tax free), the US may still tax you on it.

Now, if you live in the US for the rest of your life, it's not a bad thing. If you leave, well, you get to learn just how fun it can be.

 

[keesio]

Nearly every bank on the planet is going to make you fill out additional paperwork

Not only that, but many foreign banks will simply refuse US clients because they don't want to deal with the additional overheard. This scenario is not much of an issue in Canada because the ties to the US are too strong so they will deal with the overhead (at least with the major banks here). But if you go outside North America, the ties are not as strong and more banks will simply not want to deal with a US client.

 

[dream16]

Thank you Folks, the US Taxes for anyone working in the US (regardless of visa) are insane, and even on renouncing citizenship, it is 30% (thanks to the abuse by some celebrities in 2008, the government increased from 15 to 30%) because that's the last time ever the US government gets a chance to squeeze the maximum out of anyone, so celebrities worth millions rather decided to live in Singapore than loose all their wealth in US, anyways long story short, i am well aware about the painful FBAR requirements and world-wide declarations, but i am still looking for answers on my other points.

My eventual goal at this time & in the long term does seem to be back in US and hence live in US, so that's why i am trying to evaluate if a long 4 year sabbatical to Canada to get Canadian Citizenship and enter back in US to work on GC or TN Visa will make any sense or not: monetarily/economically etc?

 

[Leon]

As a Canadian citizen, you would have the advantage in the US that you can get a TN visa. However, I am not aware of the US giving Canadians free health care. As for Canadian health care, you have to live in Canada to be eligible, in most provinces at least 6 months a year. Once you have been outside Canada too long, even if your health care card may still be valid, it would be considered health care fraud, punishable by law, if you continue to use it.

There is also a clause in the new citizenship law of intent to reside in Canada. Nobody knows for sure how effective this clause will be in real life but because of it, you can not just stay 4 years, apply and then leave. You have to wait at least until you get citizenship and probably then some to make sure you are on the safe side so your intended 4 year sabbatical in Canada might stretch out to 5 years +

 

[dream16]

Thanks Leon, i am not sure how this new canadian citizenship law will make sense for the general public if they are not doing any free healthcare via canadian healthcard fraud in US or other countries. Its understandable that government by giving citizenship expects its newly became citizens to live - earn and spend the money in Canada to boost their economy via collecting 40% taxes, but at the same time it is putting a big stop on a person's freedom to live and earn their bread wherever in the world they want to.

For example, an indian Origin Canadian Citizen earns more than an Indian Citizen working in Dubai for the same job, same skills, same experience.

Realistically speaking, i don't see canadian government revoking canadian citizenship for folks who decide not to live in canada after taking oath, however if it's abused (health-card or some other tax incentives), the hammer might come down strongly and hence all our future generations will suffer just like its there in US with the FBAR and what not.

 

[keesio]

the hammer might come down strongly and hence all our future generations will suffer just like its there in US with the FBAR and what not.

FBAR is trivial. It is just an accounting documentation. It is FATCA and the tax obligations that is the main issue. And the hammer may not be so far off. The NDP have brought up "US style taxation" from Canadian citizens abroad.

 

[Leon]

Thanks Leon, i am not sure how this new canadian citizenship law will make sense for the general public if they are not doing any free healthcare via canadian healthcard fraud in US or other countries. Its understandable that government by giving citizenship expects its newly became citizens to live - earn and spend the money in Canada to boost their economy via collecting 40% taxes, but at the same time it is putting a big stop on a person's freedom to live and earn their bread wherever in the world they want to.

For example, an indian Origin Canadian Citizen earns more than an Indian Citizen working in Dubai for the same job, same skills, same experience.

Realistically speaking, i don't see canadian government revoking canadian citizenship for folks who decide not to live in canada after taking oath, however if it's abused (health-card or some other tax incentives), the hammer might come down strongly and hence all our future generations will suffer just like its there in US with the FBAR and what not.

I am not sure what you mean. Do you think Canada should give citizens free health care anywhere in the world? Health care in Canada is not based on citizenship, it's based on residency. Apart from that, it is provincial, not federal. In order to qualify for provincial health care, you must reside in the province for usually 6 months a year although Ontario only requires 5 months a year. The province is getting taxes off the people who live there too so it would not make sense for them to continue to cover you if you no longer live there.

Canada is not putting a stop on you living anywhere in the world. As a Canadian citizen, you are free to leave although by the clause of intent, you should not leave right away but at least make it look like you had intent when you applied. As a Canadian citizen, you are free to declare yourself as a non-resident for tax purposes and stop filing taxes in Canada. CRA may however not except this in cases where people have strong ties, for example when your whole family is living in Canada in a home you own but you yourself are living outside.

As for revoking citizenship in case of health care fraud, there is nothing in the law that allows them to do that. They can revoke citizenship based on getting it through misrepresentation though, including the intent clause but then they would have to prove that you didn't intend to live in Canada when you applied and gained citizenship.

 

[david1697]

Hello Folks:

1. My Canadian PR Became active from July 2015 this year & my PR cards have arrived at friends place in Canada.

2. I am Currently in US on H1b, with Priority Date of Sep 2012 (EB2) & from the current trends, it seems it will take another 3 years minimum i.e. Oct 2018 before i become eligible to even get an EAD card, GC dates are painfully stuck at 2005 and there's rarely a hope for their progression till 2020.

3. Have you guys faced any issues renting your own home in US while you lived in Canada to become Canadian citizens after 4 years of stay? Any US or Canadian Tax Implications in this scenario? :-[

4. I am trying to evaluate what new opportunities will i open myself to in the case i move to Canada next year & then ultimately apply for canadian citizenship around May 2020? 8)

5. Does a Canadian Citizen receive special benefits if they want to come & work-live in US? Other than receiving the TN Visa, Free Healthcare, i can't seem to determine any special advantages that a Canadian Citizen will have as compared to a US Green Card Holder. Please don't take my question as negative, no offense to anyone & kudos to all of your hardwork & years of struggle as nothing comes easy.

6. Since i will have to give up my Indian Citizenship, what negative impacts will that have on my ancestral inherited property (agricultural land)? & ongoing property investments in India? Being a POI/OCI card holder of India in future will give me special privileges?

7. Are Indians who have successfully became canadian citizens filing taxes in 3 countries: US/CAN/IND? Or declaring worldwide on CAN? Or meeting US FBAR reporting requirements for taxes?

8. Are the scenarios related to RO/Delay in applying canadian citizenship (by 15+months after 4 years of stay) fairly common for H1b Indians?

Thank you for your help & going through my post.

3. Renting home in US is easy, if you have good credit history and sufficient income. Some private renters don't even check your credit history or employment, they just charge you 2 months worth of security deposit (not in all States, some States have legal $$$ limits) ,and they simply keep it if you don't pay your rent and eventually get evicted (for non-payment of rent, etc). But why would you want to rent home in US while living in Canada?

TAXES: NOTE - CONSULT ACCOUNTANT. I AM NOT TAX SPECIALIST. I DON'T GUARANTEE OR IMPLY TOTAL ACCURACY OF ANY INFORMATION I GIVE. YOU SHOULD GOOGLE ANSWERS YOURSELF OR HIRE LICENSED SPECIALIST/ACCOUNTANT FOR PROFESSIONAL ADVICE. NOTHING I WRITE CAN BE RELIED UPON TO MAKE ANY DECISION.

US and Canada has TAX agreement and there is no double taxation. You just must declare your worldwide income to US IRS, and also file your return in Canada IF you reside in Canada.
If you were US Citizen/PR and Canadian Citizen(or PR) you would end up paying total amount owed in Canadian taxes (and not more than that).
Let's say Canada taxes 37% of your income, while US taxes 30% (I just throw the numbers, these are not exact). You would pay 30% to US IRS and the remaining %7 to Canadian revenue service. You would get credit for what you paid in US (since there is NO double taxation).
You could also pay your taxes entirely to Canadian revenue and not pay anything to US on your declared (and taxed in Canada) income, but you could loose your US PR status if you did it so (if you were USC, I think you would be OK doing this, as long as you properly declared to US all your income and taxes paid to Canadian revenue). Not sure how it works with dividends and income from savings accounts, but in general terms you don't pay more taxes than you would owe if you stayed in one of these two countries which charges the most taxes.
Your only extra expense, I think, is to an accountant whom you will probably need to hire to file income taxes in both countries , without getting yourself in trouble for not knowing all the rules.

5. Canadian Citizen does not, nor should have, any privilege over US PR. I don't know if there are any, but hope none. That would be unfair to grant more benefits to Canadian Citizens over US PR. Each country must serve it's own Citizens first, then provide for its' own PR's, and only then can grant some special benefits to Citizens of third countries, even if they are our closest allies and friends.

I am not Indian so I don't know answers to the rest of the questions you asked.

Are you truly Indian who is curious about these questions, or are you conducting a research to find out what discussion participants here think? 8)

 

[dream16]

3. Renting home in US is easy, if you have good credit history and sufficient income. Some private renters don't even check your credit history or employment, they just charge you 2 months worth of security deposit (not in all States, some States have legal $$$ limits) ,and they simply keep it if you don't pay your rent and eventually get evicted (for non-payment of rent, etc). But why would you want to rent home in US while living in Canada?

TAXES: NOTE - CONSULT ACCOUNTANT. I AM NOT TAX SPECIALIST. I DON'T GUARANTEE OR IMPLY TOTAL ACCURACY OF ANY INFORMATION I GIVE. YOU SHOULD GOOGLE ANSWERS YOURSELF OR HIRE LICENSED SPECIALIST/ACCOUNTANT FOR PROFESSIONAL ADVICE. NOTHING I WRITE CAN BE RELIED UPON TO MAKE ANY DECISION.

US and Canada has TAX agreement and there is no double taxation. You just must declare your worldwide income to US IRS, and also file your return in Canada IF you reside in Canada.
If you were US Citizen/PR and Canadian Citizen(or PR) you would end up paying total amount owed in Canadian taxes (and not more than that).
Let's say Canada taxes 37% of your income, while US taxes 30% (I just throw the numbers, these are not exact). You would pay 30% to US IRS and the remaining %7 to Canadian revenue service. You would get credit for what you paid in US (since there is NO double taxation).
You could also pay your taxes entirely to Canadian revenue and not pay anything to US on your declared (and taxed in Canada) income, but you could loose your US PR status if you did it so (if you were USC, I think you would be OK doing this, as long as you properly declared to US all your income and taxes paid to Canadian revenue). Not sure how it works with dividends and income from savings accounts, but in general terms you don't pay more taxes than you would owe if you stayed in one of these two countries which charges the most taxes.
Your only extra expense, I think, is to an accountant whom you will probably need to hire to file income taxes in both countries , without getting yourself in trouble for not knowing all the rules.

5. Canadian Citizen does not, nor should have, any privilege over US PR. I don't know if there are any, but hope none. That would be unfair to grant more benefits to Canadian Citizens over US PR. Each country must serve it's own Citizens first, then provide for its' own PR's, and only then can grant some special benefits to Citizens of third countries, even if they are our closest allies and friends.

I am not Indian so I don't know answers to the rest of the questions you asked.

Are you truly Indian who is curious about these questions, or are you conducting a research to find out what discussion participants here think? 8)

Thanks, i am more indian than anyone else here in this forum haha and thanks for your insights.

 

[AJK_9]

Hi

Would prefer Canadian Citizenship/PR as compared to US GC, US can change rules every/any moment...you can/t trust them while Canadian PR/Citizenship much safer....while someone on H1 (it's not work visa but...HAVOC VISA) better to go for first option....

 

[dream16]

Hi

Would prefer Canadian Citizenship/PR as compared to US GC, US can change rules every/any moment...you can/t trust them while Canadian PR/Citizenship much safer....while someone on H1 (it's not work visa but...HAVOC VISA) better to go for first option....

Thanks, but in the past 40 years or so we have never heard US change anything for a GC or US Citizen, so once you are done, you are done....so the canadian citizenship being better seems invalid

 

[kateg]

Thanks, but in the past 40 years or so we have never heard US change anything for a GC or US Citizen, so once you are done, you are done....so the canadian citizenship being better seems invalid

The FBAR came out in 2009. FATCA came out in 2010.

Prior to those, it was significantly cheaper to not live in the US as a US citizen.

 

[keesio]

The FBAR came out in 2009. FATCA came out in 2010.

Prior to those, it was significantly cheaper to not live in the US as a US citizen.

The FBAR has been around for a very long time (I've been filing FBARs certainly before 2009). It's just that FATCA has made it more difficult to get away with not filing or falsely filing the FBAR (and filing taxes for that matter)