yet another tax question... foreign employment income

[rhcohen2014]

so i'm on the HR Block website going through filing taxes to see if it's possible for me to do it myself for free, and i'm stuck on the Foreign Employment Income section.

I thought Canada doesn't care about my earnings in my home country before i moved here on August 29, 2014. Why are they asking for foreign employment income? Am i suppose to put the amount I earned in the US prior to becoming pr, or are they asking about after I became a resident? Most of the questions are on the basis of "anytime before december 31, 2014", so I don't know what to do and what would happen if i put my US income on the tax return? Am I going to be taxed based on that amount? I made hardly any money in Canada in 2014 after becoming pr, so it would increase my income pretty dramatically.

please help...thanks!

 

[ABCml]

so i'm on the HR Block website going through filing taxes to see if it's possible for me to do it myself for free, and i'm stuck on the Foreign Employment Income section.

I thought Canada doesn't care about my earnings in my home country before i moved here on August 29, 2014. Why are they asking for foreign employment income? Am i suppose to put the amount I earned in the US prior to becoming pr, or are they asking about after I became a resident? Most of the questions are on the basis of "anytime before december 31, 2014", so I don't know what to do and what would happen if i put my US income on the tax return? Am I going to be taxed based on that amount? I made hardly any money in Canada in 2014 after becoming pr, so it would increase my income pretty dramatically.

please help...thanks!

The simple answer is that you cannot be double taxed for your income on either side of the border - Canada has a tax treaty with the US

 

[rhcohen2014]

The simple answer is that you cannot be double taxed for your income on either side of the border - Canada has a tax treaty with the US

i understand that much. that's not what i'm asking. what i'm asking is do i put my income from the us prior to moving to canada on my canadian tax returns? and if yes, why?

 

[ABCml]

i understand that much. that's not what i'm asking. what i'm asking is do i put my income from the us prior to moving to canada on my canadian tax returns? and if yes, why?

Both the US and Canada like to know what is in your pocket - but neither will take what isn't theirs

 

[rhcohen2014]

Both the US and Canada like to know what is in your pocket - but neither will take what isn't theirs

ok, again, that's not specifically answering my question. i'd like to actually understand what to do and why before i do anything. helpful guidance is appreciated. thanks.

 

[Kayaker]

Hi rhcohen2014!

I'm doing the same thing now and it's really confusing.

Did you enter the date you became a resident of Canada for tax purposes (the date you became PR presumably)? I did, and it asked for my income, both Canadian and foreign, after I became a resident, AND my worldwide income prior to that date. I don't see how my income prior to becoming a resident is any of CRA's business but I guess ABCml is right, they want to know, just to know.

So I can't offer you any helpful guidance (I'm sorry) but I have a question myself - is your husband claiming you as his dependent? And are you filing taxes together?

The software my husband is using to calculate his taxes tries to claim me as a dependent, even though we don't want to, because I made close to the pro-rated base personal amount. I just divided the base-personal amount by 365 times the number of days I was a PR in 2014. However, the software doesn't pro-rate the base personal amount, (and does not take into account my worldwide income prior to becoming a PR) therefore it seems to think that my husband is eligible for a whopping tax return, which we're sure is wrong. So we're thinking about filing taxes separately - does anyone know if that's ok?

To go back to what you were saying, rhcohen - did you try entering your US income (prior to becoming a PR) on the software? Did that change the final result (the amount you owe, or are owed?) It shouldn't affect the result, in my opinion - at least it didn't change the result on mine.

In my opinion, these softwares are often not well-made for people like us. My husband and I considered getting a professional to do it for us mostly because it seemed like the software was made for the vast majority of people, who are residents of Canada for tax purposes 365 days a year. On the other hand, my overall income (both before and after I became a PR) isn't large enough to incur a large penalty even if we make a mistake, so we're still thinking about doing it on our own.

 

[rhcohen2014]

i was using the HR Block free online program. it basically asks you all this information then it calculates everything. I was trying to file separately because my husband still needs to do his 2013 taxes. it also asks for specific information from his return - which i don't have and don't understand why it's asking me about his return when i'm filing separately (and it won't let me continue unless i fill in some info). it did ask when i became a resident, but it doesn't ask to specify when/where the money was made. i'm still confused as to why i need to put my income before becoming a resident. I got the books from the post office, but they aren't very helpful in figuring it out, and i can't seem to figure out where the lines are the online system is asking about. sigh...


he's going to get his taxes done on thursday, so i'm just going to go with him and have a professional do it the first time. my income is just above the base personal income, so i was hoping to avoid paying someone to do a simple tax return (although i hear some places will do it for free if your income is low enough?). we are not sure if he's eligible to claim me as a dependent for 2014 since i've only been here since sept, and while he paid for all expenses in our place in canada when i was in the states, he didn't send me money for my expenses in the states. i thought canadian taxes would be easier to figure out, but i guess i need to get them done by someone else first, ask all the questions then attempt it again next year.

good luck to you!