Question about Option C?

[Volcano]

I'm sponsoring my common-law partner (an American) for PR in Canada.

I've been living and working in Shanghai for the last 4 years (which is also where I met my wife). I've got some questions about my financial situation, since I have not paid any taxes in Canada. Originally, I thought I would be unable to get an Option-C form, and instead got a letter of employment from my last employer (where I worked for just under 2 years), and dug up some past paystubs + local Shanghai tax documents.

Basically, I found out recently that my dad has been filing tax returns for me while I've been out of the country. My 'total income' on last year's annual notice of assessment was listed as under $9000 (which is money paid from my dad's consulting company), for some freelance work on the side that I did for him, and final balance on taxes paid is 0.

Has anyone been in a similar situation? I'm planning on calling the CRA and ordering my Option-C after I get back to Canada a week from now. Will I need to get any sort of signed statement from my dad?

 

[rhcohen2014]

I don't think so. I believe all they use the option c form for is to confirm you did not draw on social welfare. CIC does not care about income amount for spousal sponsorship, as there is no requirement. The main concern is whether welfare will be used upon approval.

I'd be more concerned about the CRA finding out you've actually been paid more than what you've reported, because technically i think you are suppose to claim all income received throughout the world?

 

[CMLR]

rhcohen, So does Canada require axes on world income as the USA does? I know for GST they asked us my income from nearly 2 years before we even married, but what about CRA taxes in general?

 

[keesio]

rhcohen, So does Canada require axes on world income as the USA does? I know for GST they asked us my income from nearly 2 years before we even married, but what about CRA taxes in general?

If you are a tax resident of Canada for that year, then yes you must report your world income and potentially pay taxes on it.

 

[CMLR]

I have not worked at all this year, since I have been here in Canada and cannot work until I have at least implied status. My question is, for the future does my husband's income also get taxed by both governments due to my having to claim world income?

 

[keesio]

I believe you are an American being sponsored for PR by your Canadian husband and both of you plan on living in Canada.

I am also assuming that your Canadian husband does NOT have an US citizenship or green card.

If that is correct, then:

No, he does not have to file taxes or pay any taxes to the US government. Only you do. The only accounts of his that will need to be reported to the IRS and US Dept. of Treasury (and maybe pay taxes on) are ones that you have joint accounts with. Some Canadians purposely avoid joint accounts with their US spouse to avoid having to report their information to the US.

As for you, you will need to file both Canadian and US taxes. You don't necessarily get double taxed due to tax treaties between the two countries and the ability to claim tax credits (if you paid Canadian taxes on your income already, you can claim that amount to offset your US taxes you'd owe for that income).

 

[CMLR]

I did know I had to file taxes in both the US and Canada but wondered about my husband's "world income" thanks for clarifying. And yes I am American and he is Canadian he does not have a green card and we plan to live here in Canada. Although at some point we might also try to have me sponsor him there so we can both live and work on either side of the boarder, maybe be "snow birds" but right now that is not affordable and won't be for quite some time if ever.

 

[Volcano]

Ok great, thanks for the info.