Filing Tax 2019 for newcomer PR - resident/non-resident?

[nazgul86]

Hi everyone,

I have a doubt about filing taxes in Canada, on whether I should be filing as Canadian resident or non-resident for this year 2019.

I'm a US green card holder and have been working for an American company during 2019. I have become a PR of Canada in December 2019, but only started working in Canada since January 2020. No income earned in Canada throughout 2019, but since January 2020 I'm on Canadian payroll with the same company. I filed taxes in US as tax resident for 2019. My wife was on a student visa in Canada during 2019 and became PR with me in December 2019.

I went through https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/determining-your-residency-status.html which makes me think I should be filing as Canadian resident, even though I have not earned any income during 2019 in Canada. If I would be filing as Canadian resident, would I have to report foreign income of 2019? Because if I do that, then I have lots of owed taxes, so I wonder if I should be reporting foreign income at all, and if I should I guess I would have to use the Tax Treaty deductions/credits in order to avoid paying large amounts of taxes in Canada? During these COVID-19 times, it's hard to get a handle with any tax advisors. So any help here is much appreciated.

 

[canuck_in_uk]

Hi everyone,

I have a doubt about filing taxes in Canada, on whether I should be filing as Canadian resident or non-resident for this year 2019.

I'm a US green card holder and have been working for an American company during 2019. I have become a PR of Canada in December 2019, but only started working in Canada since January 2020. No income earned in Canada throughout 2019, but since January 2020 I'm on Canadian payroll with the same company. I filed taxes in US as tax resident for 2019. My wife was on a student visa in Canada during 2019 and became PR with me in December 2019.

I went through https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/determining-your-residency-status.html which makes me think I should be filing as Canadian resident, even though I have not earned any income during 2019 in Canada. If I would be filing as Canadian resident, would I have to report foreign income of 2019? Because if I do that, then I have lots of owed taxes, so I wonder if I should be reporting foreign income at all, and if I should I guess I would have to use the Tax Treaty deductions/credits in order to avoid paying large amounts of taxes in Canada? During these COVID-19 times, it's hard to get a handle with any tax advisors. So any help here is much appreciated.

You don't have to file for 2019 but it would be a good idea to do so to get in the system and make it easier for filing 2020.

See here for what income to report https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/individuals-leaving-entering-canada-non-residents/newcomers-canada-immigrants.html#whtr

 

[nazgul86]

You don't have to file for 2019 but it would be a good idea to do so to get in the system and make it easier for filing 2020.

See here for what income to report https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/individuals-leaving-entering-canada-non-residents/newcomers-canada-immigrants.html#whtr

Thanks, do you think would be better to file with my spouse separated and set my status to "non-resident" for 2019 (even though technically I became PR in 2019) or to file jointly (as resident) but to not report any income?

 

[canuck_in_uk]

Thanks, do you think would be better to file with my spouse separated and set my status to "non-resident" for 2019 (even though technically I became PR in 2019) or to file jointly (as resident) but to not report any income?

I don't understand your question. Everyone in Canada files taxes separately. There are no joint returns like in the US. If you both moved to Canada in Dec 2019, you both became tax residents then.

 

[nazgul86]

I don't understand your question. Everyone in Canada files taxes separately. There are no joint returns like in the US. If you both moved to Canada in Dec 2019, you both became tax residents then.

When trying to file online, for example using TurboTax, it gives an option to file jointly or separately:

Do you want to prepare your returns together?
Yes, I want to prepare our returns at the same time.
No, I want to prepare my return separately from my spouse/partner.

 

[canuck_in_uk]

When trying to file online, for example using TurboTax, it gives an option to file jointly or separately:

Do you want to prepare your returns together?
Yes, I want to prepare our returns at the same time.
No, I want to prepare my return separately from my spouse/partner.

That's not filing jointly. That's just choosing whether to complete your data entry at the same time or not.

 

[nazgul86]

That's not filing jointly. That's just choosing whether to complete your data entry at the same time or not.

Got it, that's good to know!