Canadian Taxes on Foreign Interest Income Earned via NRE Fixed Deposit in India?

[jagota_j]

I am from India, living in Canada on PR and am looking at investment opportunities.

I am considering investing money in a Fixed Deposit (FD) NRE Indian bank account in India (which involves sending Canadian dollars to the Indian bank, have it converted to Indian Rupees [INR] currency which then would be put in the FD account) that pays 7.5% annual interest (however in INR.)

From taxation point of view, the interest earned would not be taxed in India.

Would it rather be taxed/considered taxable income in Canada?

 

[jagota_j]

Thanks for the response.

Would you also happen to have the corresponding CRA link that I can refer to?

 

[torontosm]

I am from India, living in Canada on PR and am looking at investment opportunities.

I am considering investing money in a Fixed Deposit (FD) NRE Indian bank account in India (which involves sending Canadian dollars to the Indian bank, have it converted to Indian Rupees [INR] currency which then would be put in the FD account) that pays 7.5% annual interest (however in INR.)

From taxation point of view, the interest earned would not be taxed in India.

Would it rather be taxed/considered taxable income in Canada?

Yes, it would definitely be considered taxable income in Canada. Income earned anywhere in the world is taxed in Canada while you are a resident of Canada.

 

[Manju Sagwal]

I am from India, living in Canada on PR and am looking at investment opportunities.

I am considering investing money in a Fixed Deposit (FD) NRE Indian bank account in India (which involves sending Canadian dollars to the Indian bank, have it converted to Indian Rupees [INR] currency which then would be put in the FD account) that pays 7.5% annual interest (however in INR.)

From taxation point of view, the interest earned would not be taxed in India.

Would it rather be taxed/considered taxable income in Canada?

Yes. It would be taxable in Canada. Not sure about India though ;D

As per Canadian taxation law, income earned by a PR holder/Citizen anywhere in the world is taxable in Canada.

 

[jagota_j]

Thanks for the response Manju and torontosm.

 

[rajeshcvaswani]

I have a ppf account in india opened in my name by my mother when i was minor which gives tax free interest in india.Do I need to pay tax on it in canada since I have become major.