Part-year resident / Non-resident or Deemed Non-resident

[ibanking90]

Dear All,

I'd like to have your opinion on my situation regarding paying tax in Canada for 2018.

In Nov 2017, me and my wife made our soft landing to activate Canadian PR, we only stayed for 3 days during which we opened individual bank accounts but did not deposit any money in them. We then returned to the US to continue working there.

In Feb 2018, we returned to Canada to pick up our PR cards and only stayed for 3 days. We then returned to the US to continue working there.

In August 2018, my wife quit her job to move to Toronto, we applied for SIN numbers, and signed a rental contracts (I had to put my name on the rental contract since my wife was not working and the landlords would not rent to us if she is the only one on the lease). We also deposited some money into our bank accounts. I stayed for 1 week and returned to the US to continue working there while my wife remained in Canada.

In September and October 2018, I visited my wife in Toronto and stayed for 3 days each time.

My wife received her Ontario Health Card in Oct 2018 and started working in Nov 2018.

My question is:
1. For my wife, what is her tax filing status (part-year resident / non-resident) in Canada for 2018 tax and when does that status take effect.

2. For myself, I had some interests from the bank account in Canada. What income do I have to pay tax on and under what status.

Thank you so much!

 

[karanjessica]

Dear All,

I'd like to have your opinion on my situation regarding paying tax in Canada for 2018.

In Nov 2017, me and my wife made our soft landing to activate Canadian PR, we only stayed for 3 days during which we opened individual bank accounts but did not deposit any money in them. We then returned to the US to continue working there.

In Feb 2018, we returned to Canada to pick up our PR cards and only stayed for 3 days. We then returned to the US to continue working there.

In August 2018, my wife quit her job to move to Toronto, we applied for SIN numbers, and signed a rental contracts (I had to put my name on the rental contract since my wife was not working and the landlords would not rent to us if she is the only one on the lease). We also deposited some money into our bank accounts. I stayed for 1 week and returned to the US to continue working there while my wife remained in Canada.

In September and October 2018, I visited my wife in Toronto and stayed for 3 days each time.

My wife received her Ontario Health Card in Oct 2018 and started working in Nov 2018.

My question is:
1. For my wife, what is her tax filing status (part-year resident / non-resident) in Canada for 2018 tax and when does that status take effect.

2. For myself, I had some interests from the bank account in Canada. What income do I have to pay tax on and under what status.

Thank you so much!

Hi, HR block in Toronto will answer this. I don't know much.Thanks

 

[mad_hatter]

You wife became tax resident on the date she moved to Canada in August 2018. For you, it depends on whether you informed the bank you are a non-resident. If you had, you do not have to file a tax return, because the bank would have withheld 25% of earned interest and submit the money to CRA on your behalf.

 

[ibanking90]

You wife became tax resident on the date she moved to Canada in August 2018. For you, it depends on whether you informed the bank you are a non-resident. If you had, you do not have to file a tax return, because the bank would have withheld 25% of earned interest and submit the money to CRA on your behalf.

Thanks for the reply!

For my wife, does it mean that she will only need to pay tax on worldwide income from August to December 2018?

For myself, I did not inform the bank, does it mean I have to submit a non-resident tax return to pay tax on the interest?

 

[mad_hatter]

Yes, your wife only needs to pay tax on world income after August.

I was incorrect in saying the bank will deduct tax from earned interest. CRA changed the rule in 2008, non-resident no longer has to pay tax on interest. You do not have to file a Canadian tax return.

 

[ibanking90]

I'm using TurboTax to file the return for my wife, there are 2 options that TurboTax is giving me: NETFILE or Print and Mail, as this is the first time my wife files tax in Canada, which option should I choose for her?

Thanks.

 

[mad_hatter]

You wife needs to submit her tax return by mail.

 

[spyfy]

You wife needs to submit her tax return by mail.

Why? Maybe I am misreading the OPs original post but contrary to popular belief you can file taxes online in the year you moved to Canada. Only if you are LEAVING Canada do you have to file via mail.

 

[mad_hatter]

You are correct, apparently CRA has removed the restriction on Netfile by first time tax player for tax year 2018.