We became Canadian PR in Dec. 2010 and immediately returned to India. Subsequently I came to Canada at end of August 2011, while my spouse was still in India. She came to Canada in Nov 2012. As a permanent resident of Canada she could be considered resident of
Canada as CRA guide says (http://www.cra-arc.gc.ca/tx/nnrsdnts/cmmn/rsdncy-eng.html)
The residential ties you have or establish in Canada are a major factor in determining residence status. Residential ties to Canada include:
•a home in Canada (not applicable);
•a spouse or common-law partner or dependants in Canada (applicable as I was in Canada);So she will be considered resident of Canada since August 2011.
However, CRA also says
Residential ties that you maintain or establish in another country may also be relevant.
Now when I read Canada and India Tax Treaty it says:
ARTICLE 4
Residence
1. For the purposes of this Agreement, the term “resident of a Contracting State”
means any person who, under the laws of that State, is liable to tax therein by
reason of his domicile, residence, place of management or any other criterion of
a similar nature.
By Virtue of Above statement she is resident of India as she paid taxes in India in 2011 and lived entirely in India even though she was PR of Canada.
I feel first clause is generic and applicable to all but one should see the Tax treaty if Canada has one.
I tried to call several CRA agents even at internatonal and non-resident department but havent got satisfactory answer yet.
I FEEL SHE SHOULD BE CONSIDERED NON_RESIDENT OF CANADA FOR TAX PURPOSE EVEN THOUGH SHE WAS PR OF CANADA AND HER SPOUSE WAS IN CANADA BECAUSE AS PER TAX TREATY SHE IS RESIDENT OF INDIA
PLEASE ADVISE
Canada as CRA guide says (http://www.cra-arc.gc.ca/tx/nnrsdnts/cmmn/rsdncy-eng.html)
The residential ties you have or establish in Canada are a major factor in determining residence status. Residential ties to Canada include:
•a home in Canada (not applicable);
•a spouse or common-law partner or dependants in Canada (applicable as I was in Canada);So she will be considered resident of Canada since August 2011.
However, CRA also says
Residential ties that you maintain or establish in another country may also be relevant.
Now when I read Canada and India Tax Treaty it says:
ARTICLE 4
Residence
1. For the purposes of this Agreement, the term “resident of a Contracting State”
means any person who, under the laws of that State, is liable to tax therein by
reason of his domicile, residence, place of management or any other criterion of
a similar nature.
By Virtue of Above statement she is resident of India as she paid taxes in India in 2011 and lived entirely in India even though she was PR of Canada.
I feel first clause is generic and applicable to all but one should see the Tax treaty if Canada has one.
I tried to call several CRA agents even at internatonal and non-resident department but havent got satisfactory answer yet.
I FEEL SHE SHOULD BE CONSIDERED NON_RESIDENT OF CANADA FOR TAX PURPOSE EVEN THOUGH SHE WAS PR OF CANADA AND HER SPOUSE WAS IN CANADA BECAUSE AS PER TAX TREATY SHE IS RESIDENT OF INDIA
PLEASE ADVISE