We came from USA to Canada. We are landed immigrants to Canada and citizens of India. We will have investing income coming from USA. To which country do we have to report taxes for this income? Is it USA or Canada or both countries?

Thank You,
Hema.

Assuming you are not a citizen nor a resident of the United States, the investment income should be subject only to witholding tax in the US with no further filing requirement. If you are resident or a citizen of the US, you may be required to file a US income tax return including the investment income.

If you are considered to be resident in both Canada and the US at the same time, the Canada-US Income Tax Treaty contains “tiebreaker “ rules that will deem you to be resident in only one of the countries.

As a Canadian resident, you will be subject to Canadian tax on your world income from the date you became resident in Canada. To the extent taxes have been paid in the United States, you may be able to reduce or avoid double taxation by claiming a foreign tax credit in Canada.

The nature of this facility is to provide a general response to a general question. Under no circumstances should anyone act on this information without obtaining analysis and counsel from a qualified advisor with respect to the specific situation.

Phillip Nadler, CA
Richter Usher & Vineberg
http://www.richter.ca