Query about filing income tax on income earned in another country while outside canada

[SimpleMac]

Hello Everyone,

I came to canada as PR in 2019 Dec and could not get any jobs due to covid. So i went back to india in Aug 2020. I got a job in india and stayed in india until feb 2023. I had not filied any taxes in canada for the year 2021, 2022. I paid my taxes for my indian income in India as it's my country of citisenship. I came back to canada in feb 2023 to keep my PR status alive. I got a job in canada in march 2023. When i filed my taxes for 2023 in canada, my tax accountant, declared my india income for 2021 and 2022. CRA is now asking me to pay retractive tax on my indian income in 2021 and 2022. they are asking me to pay 12000 CAD. I have reached out to them and they have asked me to fill in N73,N74 forms about entering and leaving canada to determine my liable tax. During 2021,2022 I had an active bank account in canadian bank with balance of less than 5000CAD and also had an active phone connection for those 2 years even though i was outside canada.
My question is
in N73 form (determination of residency entering canada) , there is a question under section "statement of residency" "Are you considered resident in the other country and not in canada under a tax treaty with the other country" What should i answer for this question?
@steaky , @rajkamalmohanram @legalfalcon , @canuck78 : i would really appreciate your guidance

 

[steaky]

Hello Everyone,

I came to canada as PR in 2019 Dec and could not get any jobs due to covid. So i went back to india in Aug 2020. I got a job in india and stayed in india until feb 2023. I had not filied any taxes in canada for the year 2021, 2022. I paid my taxes for my indian income in India as it's my country of citisenship. I came back to canada in feb 2023 to keep my PR status alive. I got a job in canada in march 2023. When i filed my taxes for 2023 in canada, my tax accountant, declared my india income for 2021 and 2022. CRA is now asking me to pay retractive tax on my indian income in 2021 and 2022. they are asking me to pay 12000 CAD. I have reached out to them and they have asked me to fill in N73,N74 forms about entering and leaving canada to determine my liable tax. During 2021,2022 I had an active bank account in canadian bank with balance of less than 5000CAD and also had an active phone connection for those 2 years even though i was outside canada.
My question is
in N73 form (determination of residency entering canada) , there is a question under section "statement of residency" "Are you considered resident in the other country and not in canada under a tax treaty with the other country" What should i answer for this question?
@steaky , @rajkamalmohanram @legalfalcon , @canuck78 : i would really appreciate your guidance

Sort this out with a real chartered accountant specializing with cross border tax issues (with India).

 

[canuck78]

Hello Everyone,

I came to canada as PR in 2019 Dec and could not get any jobs due to covid. So i went back to india in Aug 2020. I got a job in india and stayed in india until feb 2023. I had not filied any taxes in canada for the year 2021, 2022. I paid my taxes for my indian income in India as it's my country of citisenship. I came back to canada in feb 2023 to keep my PR status alive. I got a job in canada in march 2023. When i filed my taxes for 2023 in canada, my tax accountant, declared my india income for 2021 and 2022. CRA is now asking me to pay retractive tax on my indian income in 2021 and 2022. they are asking me to pay 12000 CAD. I have reached out to them and they have asked me to fill in N73,N74 forms about entering and leaving canada to determine my liable tax. During 2021,2022 I had an active bank account in canadian bank with balance of less than 5000CAD and also had an active phone connection for those 2 years even though i was outside canada.
My question is
in N73 form (determination of residency entering canada) , there is a question under section "statement of residency" "Are you considered resident in the other country and not in canada under a tax treaty with the other country" What should i answer for this question?
@steaky , @rajkamalmohanram @legalfalcon , @canuck78 : i would really appreciate your guidance

Did you file Canadian taxes in 2020? Did you contact CRA when you left to determine your residency status once you left? Did you receive any funds from CRA from 2019-2023 when you returned?

 

[SimpleMac]

Did you file Canadian taxes in 2020? Did you contact CRA when you left to determine your residency status once you left? Did you receive any funds from CRA from 2019-2023 when you returned?

Thanks for your response @canuck78 .
1) Yes, I filed the 2020 taxes in 2023 when i came back.
2) No, I did not inform them. I just left and wasn't sure if and when I would be coming back.
3) I received approx 400 dollars in 2020 and 1st quarter of 2021 as GST/Carbon tax rebate.
4) When I filed my taxes in 2023, the CRA deducted the whole refund amount stating they are claiming those rebates back.
Now they are asking me to fill in N73 about entering in 2019,N74 form for leaving canada in 2020 and then N73 form for reentering canada in 2023.

I had no investments or employments income in canada in 2020,2021,2022. I was only working in india for an indian company. I had an active Driver's license, bank account, phone number and credit card in canada for these years. Would they consider these as a tie to canada to make me liable to pay taxes.
I have worked with 2-3 different accountants but they were unable to provide me adequate advise on this issue.
I would appreciate your advise..thank you!

 

[SimpleMac]

Sort this out with a real chartered accountant specializing with cross border tax issues (with India).

Thank you @steaky , I have worked with 2-3 different accountants but they were unable to provide adequate guidance

 

[Copingwithlife]

Hello Everyone,

I came to canada as PR in 2019 Dec and could not get any jobs due to covid. So i went back to india in Aug 2020. I got a job in india and stayed in india until feb 2023. I had not filied any taxes in canada for the year 2021, 2022. I paid my taxes for my indian income in India as it's my country of citisenship. I came back to canada in feb 2023 to keep my PR status alive. I got a job in canada in march 2023. When i filed my taxes for 2023 in canada, my tax accountant, declared my india income for 2021 and 2022. CRA is now asking me to pay retractive tax on my indian income in 2021 and 2022. they are asking me to pay 12000 CAD. I have reached out to them and they have asked me to fill in N73,N74 forms about entering and leaving canada to determine my liable tax. During 2021,2022 I had an active bank account in canadian bank with balance of less than 5000CAD and also had an active phone connection for those 2 years even though i was outside canada.
My question is
in N73 form (determination of residency entering canada) , there is a question under section "statement of residency" "Are you considered resident in the other country and not in canada under a tax treaty with the other country" What should i answer for this question?
@steaky , @rajkamalmohanram @legalfalcon , @canuck78 : i would really appreciate your guidance

https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/determining-your-residency-status.html


Should have done your due diligence in what constitutes residency ties

Secondary residential ties that may be relevant include:

• personal property in Canada, such as a car or furniture
• social ties in Canada, such as memberships in Canadian recreational or religious organizations
• economic ties in Canada, such as Canadian bank accounts or credit cards
• a Canadian driver's licence
• a Canadian passport
• health insurance with a Canadian province or territory