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RO and UK Tax Residency

Berty3000

Star Member
Jan 17, 2017
154
14
Hi all,

If i live in Canada as a PR but work online for a UK employer and UK based clients, is it possible for me to be considered a UK resident for tax purposes whilst living in Canada and building up time to meet my residency obligations (and eventually citizenship obligations)?

Thanks
 

jddd

Champion Member
Oct 1, 2017
1,402
479
Hi all,

If i live in Canada as a PR but work online for a UK employer and UK based clients, is it possible for me to be considered a UK resident for tax purposes whilst living in Canada and building up time to meet my residency obligations (and eventually citizenship obligations)?

Thanks
I don't get the UK tax residency thing but I would assume no unless you have status in the UK? You live in Canada so you pay taxes in Canada. As long as you are physically in Canada, you are fulfilling the physical requirements to apply for citizenship/renew PR card.
 
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canuck_in_uk

VIP Member
May 4, 2012
31,633
7,056
Visa Office......
London
App. Filed.......
06/12
Hi all,

If i live in Canada as a PR but work online for a UK employer and UK based clients, is it possible for me to be considered a UK resident for tax purposes whilst living in Canada and building up time to meet my residency obligations (and eventually citizenship obligations)?

Thanks
You will be a resident for tax purposes in Canada. There is a tax treaty to prevent double taxation.
 
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canuck78

VIP Member
Jun 18, 2017
26,636
5,735
Hi all,

If i live in Canada as a PR but work online for a UK employer and UK based clients, is it possible for me to be considered a UK resident for tax purposes whilst living in Canada and building up time to meet my residency obligations (and eventually citizenship obligations)?

Thanks
You’ll need to declare that you are living in Canada to your UK employer and set up a payment method based on the fact that you are not a UK resident.
 
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dpenabill

VIP Member
Apr 2, 2010
4,384
1,511
Hi all,

If i live in Canada as a PR but work online for a UK employer and UK based clients, is it possible for me to be considered a UK resident for tax purposes whilst living in Canada and building up time to meet my residency obligations (and eventually citizenship obligations)?

Thanks
Usually I am the one who obfuscates the simple answer with tangential responses.

Short answer: Whether it is possible for you to be considered a UK resident for tax purposes depends on UK laws and rules. Nothing to do with your immigration status in Canada.

This forum, which is about Canadian immigration and related matters, is NOT a reliable source of advice about tax matters EVEN as to Canadian tax matters, let alone tax questions for other countries.



= = = = = = = = = = = = = = = = = =

But of course I cannot resist the tangential, and will offer a By-The-Way observation: "work online for a UK employer and UK based clients" may involve many variations.

I know nothing about UK tax filing, income reporting, tax paying obligations.

But in Canada, and in the U.S., there can be important distinctions between work done pursuant to a formal employee-employer relationship in contrast to work performed in other contexts or pursuant to other relationships (short or long-term contractual relationships for example that do not constitute a formal employer-employee relationship under the respective jurisdiction's laws and rules). And even though remote work, using telecommunications, has been around for several decades, including internationally (personally I have been doing it, almost exclusively, for two decades), the respective laws including tax-related rules are still evolving, still in the process of adapting.

When the individual doing the work and the entity hiring or employing the work are in different countries, such matters may invoke a wide range of implications, including those which are tax-related, reporting-related, regulation-related, licensing-related, matters related to regulating importation and exportation. Among others. The details matter.

But in any event, whether or not an individual is considered a "resident" of a particular country for tax-purposes depends on the laws and rules of that country.

In Canada, there are many factors to be considered in determining whether an individual is a resident for tax purposes. Immigration status can have some influence, but is a relatively small factor compared to many others and for sure is NOT what determines whether the individual is a resident for tax purposes or not.

And as emphasized elsewhere, tax filing and related reporting and paying obligations depend on much, much more than merely whether an individual is or is not a resident of Canada for tax purposes.
 
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Bs65

VIP Member
Mar 22, 2016
12,300
2,156
Hi all,

If i live in Canada as a PR but work online for a UK employer and UK based clients, is it possible for me to be considered a UK resident for tax purposes whilst living in Canada and building up time to meet my residency obligations (and eventually citizenship obligations)?

Thanks
Seem pretty clear that you probably do not meet UK tax residency unless you meet the conditions in attached link which to a degree mirror Canada Tax residency conditions. Why do you have a desire to remain tax resident in the UK, apart from fact have to pay tax somewhere whether Canada or UK, maybe share what is the perceived benefit. Many people on here might in fact suggest if your are living in Canada as a PR or any other status (apart from visitor) that you should be paying tax in Canada on WW income regardless of where your employer or workload is based

https://www.gov.uk/tax-foreign-income/residence

https://www.gov.uk/tax-foreign-income/non-domiciled-residents
 
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Berty3000

Star Member
Jan 17, 2017
154
14
Thank you all for the helpful responses. Likes duly given :)

So if I work for a UK company and customers and am paid in sterling into a British Bank account, presumably i just have to assume i am tax resident in Canada - as I physically would live there - and complete a tax return accordingly. Fair enough.

I have two reasons for asking...

- firstly, the work situation is good for me in the UK and i may be able to continue on a remote basis.
- i have stocks and shares investments in an ISA (tax free savings account) and a SIPP (self invested pension). I do not want to mess about changing these into cash, and then into CAD, and transfer. I want it all left in the UK and I'd prefer to continue benefitting from the tax free status. I understand Canada doesn't recognise the tax free status of a UK ISA. Not sure about pensions. So I'd have to pay tax on dividends and capital gains.

I'm happy to pay income tax in Canada, and pay tax on regular savings interest held in the UK. But it would be very frustrating to lose tax benefits on money i already have invested in accounts the UK government leaves alone. Any thoughts?
 

canuck_in_uk

VIP Member
May 4, 2012
31,633
7,056
Visa Office......
London
App. Filed.......
06/12
Thank you all for the helpful responses. Likes duly given :)

So if I work for a UK company and customers and am paid in sterling into a British Bank account, presumably i just have to assume i am tax resident in Canada - as I physically would live there - and complete a tax return accordingly. Fair enough.

I have two reasons for asking...

- firstly, the work situation is good for me in the UK and i may be able to continue on a remote basis.
- i have stocks and shares investments in an ISA (tax free savings account) and a SIPP (self invested pension). I do not want to mess about changing these into cash, and then into CAD, and transfer. I want it all left in the UK and I'd prefer to continue benefitting from the tax free status. I understand Canada doesn't recognise the tax free status of a UK ISA. Not sure about pensions. So I'd have to pay tax on dividends and capital gains.

I'm happy to pay income tax in Canada, and pay tax on regular savings interest held in the UK. But it would be very frustrating to lose tax benefits on money i already have invested in accounts the UK government leaves alone. Any thoughts?
Unfortunately, with the different tax laws of various countries, people end up paying tax in one country when they don't have to in another country. As Canada doesn't recognize the tax free status of your ISA, you will have to report it as income and pay tax. Also keep in mind that depending on the value of your foreign assets, you may be required to file a T1135.
 

Berty3000

Star Member
Jan 17, 2017
154
14
Unfortunately, with the different tax laws of various countries, people end up paying tax in one country when they don't have to in another country. As Canada doesn't recognize the tax free status of your ISA, you will have to report it as income and pay tax. Also keep in mind that depending on the value of your foreign assets, you may be required to file a T1135.
So do they have any tax free thresholds at least like the UK? Like no capital gains tax under 11k, no dividend tax under 2k, etc? Are there any work arounds? Also, what would happen with my pension, does Turdeau want that as well?
 

canuck_in_uk

VIP Member
May 4, 2012
31,633
7,056
Visa Office......
London
App. Filed.......
06/12
So do they have any tax free thresholds at least like the UK? Like no capital gains tax under 11k, no dividend tax under 2k, etc? Are there any work arounds? Also, what would happen with my pension, does Turdeau want that as well?
There is the basic personal amount everyone can earn without being taxed and various tax credits.

No idea about your pension. It's nothing to do with the PM; Canada's tax laws were around long before him.
 
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canuck78

VIP Member
Jun 18, 2017
26,636
5,735
Thank you all for the helpful responses. Likes duly given :)

So if I work for a UK company and customers and am paid in sterling into a British Bank account, presumably i just have to assume i am tax resident in Canada - as I physically would live there - and complete a tax return accordingly. Fair enough.

I have two reasons for asking...

- firstly, the work situation is good for me in the UK and i may be able to continue on a remote basis.
- i have stocks and shares investments in an ISA (tax free savings account) and a SIPP (self invested pension). I do not want to mess about changing these into cash, and then into CAD, and transfer. I want it all left in the UK and I'd prefer to continue benefitting from the tax free status. I understand Canada doesn't recognise the tax free status of a UK ISA. Not sure about pensions. So I'd have to pay tax on dividends and capital gains.

I'm happy to pay income tax in Canada, and pay tax on regular savings interest held in the UK. But it would be very frustrating to lose tax benefits on money i already have invested in accounts the UK government leaves alone. Any thoughts?
This is more complicated. You need to arrange to pay taxes/deductions on your UK if you want to live in Canada. Your employer can’t process your payroll like other workers living in the UK.
 

canuck_in_uk

VIP Member
May 4, 2012
31,633
7,056
Visa Office......
London
App. Filed.......
06/12
This is more complicated. You need to arrange to pay taxes/deductions on your UK if you want to live in Canada. Your employer can’t process your payroll like other workers living in the UK.
OP doesn't need to make arrangements or pay Canadian deductions on foreign income. They just need to report the income when they file their return and pay any applicable income tax.