Taxation of foreign income earned before but paid after declaring Canadian residency

[foryoda]

I am trying to understand how the Canadian tax authorities would view 1) foreign income that was earned before but received after declaring Canadian residency and 2) how foreign retirement savings (HK MPF plan) which have been withdrawn from the retirement plan (never taxed) where the contributions were made before declaring Canadian residency but the funds were not available until after.

Consider the example below:

If my last day of employment in a foreign country is Dec 31 2017, and I land in Canada and declare residency on Jan 1 2018, would the following items be subject to Canadian tax:

1. Foreign income that was earned prior to declaring Canadian residency (e.g. earned in Dec 2017) but paid after residency was declared (e.g. paid in Jan 2018).

2. Pension money that has been withdrawn from a HK MPF pension account - the money has never been taxed as this was in a retirement plan. HK allows a one-time withdrawal of pension funds if an individual declares that they will be leaving HK permanently but this is a 30-day process. The pension contributions were all made prior to declaring Canadian residency (e.g. 2017 and before) but the money is not available until Jan 2018 (after the 30-day process). Would this be subject to any Canadian tax?

The cleanest way would be to make sure that all of the amounts in 1 and 2 were received prior to declaring residency but I want to understand the implications if they were not. Thank you

 

[steaky]

1) It was 9am in Vancouver on 31 Dec but 1am in Hong Kong on 1 Jan.
2) Yes, there might be fluctuations between 31 December and 31 January.

 

[ic2020]

foryoda, what was your outcome? I am in a similar situation. Trying to have everything paid before I depart HK and enter Canada (declaring residency), but just in case, want to know the rule. There is a Double Taxation agreement also, did you use that?

 

[steaky]

foryoda, what was your outcome? I am in a similar situation. Trying to have everything paid before I depart HK and enter Canada (declaring residency), but just in case, want to know the rule. There is a Double Taxation agreement also, did you use that?

If I did not do something to alert you (such as quoting the previous message), I wondered if you would give a response after 2.5 years? Probably not.

 

[ic2020]

Probably not. But hopefully other friendly members see the 'bumped' message and reply with input. It should be a common concern for anyone moving to Canada - given Canada taxation works from the date of entry, regardless when the income was earned.

 

[steaky]

Btw if you withdraw your MPF while you became Canadian resident, will be subject to Canadian tax.

 

[ic2020]

Btw if you withdraw your MPF while you became Canadian resident, will be subject to Canadian tax.

Thanks but the question is more specfic. The MPF pension was withdrawn / vested before becoming Canadian resident, but they payment of the lump sum takes 30 days to process due to administrative delay.