To claim or not to claim your non-resident spouse on your Canadian tax return

[tishness]

I know I've come across some topics of this but can't seem to find them now when I want.

The premise:
So the sponsor (me) lives and works in Canada
My spouse does not live here
We are applying outland (obviously)

I have read that you claim their net income as zero, however the CRA rules state (and I have this from the horses mouth at CRA) that you must claim "worldwide" income of your spouse. That it will not affect your return but you can then claim spousal credit if you "support" them and I guess now maybe income split.

Anyone else in my boat? What are you doing? Does it make a difference this year with income splitting?

Also, (if there are any accountants out there) what if your spouse does not have a cohesive record of net income YTD? If I am doing an educated guess, is that considered tax fraud?

 

[Galano1213]

I claimed my. Cuban husband last year on my income tax as a dependant on line 303 after calling cra and getting direction . I stated his income in Canadian dollars I sent a copy of his birth certificate and explained that we were in the process of immigration I received a refund If you try to do it electronically the system will ask for a social insurance number which he does not have so it has to be done on the paper system I had no problem This year I plan to send a copy of the AOr letter I received with a letter explaining that the app is in Havana as of Jan 6 so they know that he is not here yet They will also have his name as my husband from last year. Under the law you must answer yes to your marital status. I have been reading on here that some people are not doing that when they file and I would not want to get caught doing that.

 

[agarand8]

My dad is my accountant and we file electronically without issue, we put my husbands information and choose that he is a non resident and for his income we also just guess as he works for very low wages paid in cash. I don't understand it all but I think my dad just puts the "minimum" amount for my husbands income because I noticed that he had an amount in there that was much higher that what my husband actually would have made but he said it doesn't make a difference.

 

[tishness]

My dad is my accountant and we file electronically without issue, we put my husbands information and choose that he is a non resident and for his income we also just guess as he works for very low wages paid in cash. I don't understand it all but I think my dad just puts the "minimum" amount for my husbands income because I noticed that he had an amount in there that was much higher that what my husband actually would have made but he said it doesn't make a difference.

are you then claiming his as a dependent?

 

[Rob_TO]

I know I've come across some topics of this but can't seem to find them now when I want.

The premise:
So the sponsor (me) lives and works in Canada
My spouse does not live here
We are applying outland (obviously)

I have read that you claim their net income as zero, however the CRA rules state (and I have this from the horses mouth at CRA) that you must claim "worldwide" income of your spouse. That it will not affect your return but you can then claim spousal credit if you "support" them and I guess now maybe income split.

Anyone else in my boat? What are you doing? Does it make a difference this year with income splitting?

Also, (if there are any accountants out there) what if your spouse does not have a cohesive record of net income YTD? If I am doing an educated guess, is that considered tax fraud?

Income splitting only applies to families that have children. If you don't have kids, you can't claim income splitting credits.

The spousal tax credit is meant mainly for situations where you are living with your spouse in Canada. You can claim a spouse as dependent who is not living with you in Canada, HOWEVER in order to do this you must be able to show the world income of your spouse is zero or a very low amount (like much less than $11K CDN per year), AND that you are actually supporting them financially so are sending them money and have records of this.

If you claim them and are not actually supporting them or sending them money, if you are ever audited in the future and CRA determines you don't have the necessary proof they will demand you pay any credits back to them.

Read more here for claiming spouses not currently residing in Canada:
http://www.howlandtax.com/articles/nonresident-spouse.htm
http://www.cra-arc.gc.ca/E/pub/tp/it513r/it513r-e.html#P178_25861

 

[tishness]

Income splitting only applies to families that have children. If you don't have kids, you can't claim income splitting credits.

The spousal tax credit is meant mainly for situations where you are living with your spouse in Canada. You can claim a spouse as dependent who is not living with you in Canada, HOWEVER in order to do this you must be able to show the world income of your spouse is zero or a very low amount (like much less than $11K CDN per year), AND that you are actually supporting them financially so are sending them money and have records of this.

If you claim them and are not actually supporting them or sending them money, if you are ever audited in the future and CRA determines you don't have the necessary proof they will demand you pay any credits back to them.

Read more here for claiming spouses not currently residing in Canada:
http://www.howlandtax.com/articles/nonresident-spouse.htm
http://www.cra-arc.gc.ca/E/pub/tp/it513r/it513r-e.html#P178_25861

Thanks Rob_TO this is exactly what I needed - you are way more helpful than the CRA
So I won't be claiming income splitting or spousal tax credit - but I should still declare his income? Which again I am guessing at... He doesn't file any sort of tax return and has switched jobs within the year and doesn't have records or pay stubs even. Is that going to really matter or should I just claim the minimum amount as I don't think it is more than that.

 

[agarand8]

I just looked and looks like no, only the baby is claimed as a dependant. maybe I should be though since I send him minimum of $400/month...but....CIC has most of the receipts....

 

[Jalex23]

Thanks Rob_TO this is exactly what I needed - you are way more helpful than the CRA

CRA webpage states it clearly:

"You can claim this amount if, at any time in the year, you supported your spouse or common-law partner and his or her net income was less than $11,138. "
http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns300-350/303/menu-eng.html

Obviously everything that you claim should be backed up with evidence.


So yes, you can claim it as long as you qualify.

I claimed mine.

 

[Rob_TO]

Thanks Rob_TO this is exactly what I needed - you are way more helpful than the CRA
So I won't be claiming income splitting or spousal tax credit - but I should still declare his income? Which again I am guessing at... He doesn't file any sort of tax return and has switched jobs within the year and doesn't have records or pay stubs even. Is that going to really matter or should I just claim the minimum amount as I don't think it is more than that.

Once you tell CRA that you're married, then they usually ask for your spouses world income. They don't usually ask for proof of it, just to state it to them.
Even though your spouse is not living in Canada, he does have a strong tie to Canada and that is you. People can be considered deemed or factual residents of Canada even if they aren't living here. CRA may want to use his world income to calculate your "family" income. He won't owe any taxes, but any credits/benefits you were getting as single, may be lowered or eliminated if they use his world income.

CRA webpage states it clearly:

"You can claim this amount if, at any time in the year, you supported your spouse or common-law partner and his or her net income was less than $11,138. "
http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns300-350/303/menu-eng.html

Obviously everything that you claim should be backed up with evidence.


So yes, you can claim it as long as you qualify.

I claimed mine.

There are 2 scenarios possible, and only 1 requires evidence.
1. If your spouse is living with you in Canada and not working, then you can claim the max under spousal amount with no evidence or proofs required.
2, If your spouse is living outside Canada so a non-resident, then you can claim the max only with evidence of regular money transfers/receipts and proof they are not being supported by someone else in their home country.

 

[Jalex23]

There are 2 scenarios possible, and only 1 requires evidence.
1. If your spouse is living with you in Canada and not working, then you can claim the max under spousal amount with no evidence or proofs required.
2, If your spouse is living outside Canada so a non-resident, then you can claim the max only with evidence of regular money transfers/receipts and proof they are not being supported by someone else in their home country.

Yeah, as I said, you need evidence of whatever you declare. Its in the CRA website.

 

[calvinw06]

Yeah, as I said, you need evidence of whatever you declare. Its in the CRA website.

old thread here, but I like to know if I'm sending money to my wife via her ex boss bank account. Is this going to be an issue with CIC and CRA? My wife's father is currently working for that boss now. I think the boss owns Hotel business. My wife doesn't work for him anymore. The ex boss has bank account opened in Florida and I've sent money to that account about 3 to 4 times now and it has gone through successfully. He then gives the $USD to my father in law or my wife. I kept all the receipts and my wife even taken pictures of the $USD money she received from her ex boss. We have screenshots of full on conversations about this.

The reason why I don't send the money to her actual account is cause she lives in Venezuela and the exchange rate and inflation is off the charts. Example: If I send her like a few 100s in USD, she'll only receive like $20.00 in her bank account. So what do you guys think of this? Do I need a written letter from her ex boss acknowledging this?

I'm trying to do my 2016 taxes right now and I got the turbo tax basic software from best buy. The software ask for my relationship status and I obviously say I'm married, but it doesn't ask for my wife's information. She's a non resident of Canada. I just recently found out I can claim my wife and have proof I'm supporting her. But not sure if that proof is strong enough cause I'm sending money to her ex boss. And is Turbo Tax the right way to claim my wife or do I have to do this with an accountant?

 

[Rob_TO]

She's a non resident of Canada. I just recently found out I can claim my wife and have proof I'm supporting her. But not sure if that proof is strong enough cause I'm sending money to her ex boss. And is Turbo Tax the right way to claim my wife or do I have to do this with an accountant?

It sounds like a very fishy process, and I highly doubt CRA would allow it as formal proof of supporting your wife since you aren't sending the money directly to her. Did you read the links posted to above that explain the burden of proof you need to have?

http://www.cra-arc.gc.ca/E/pub/tp/it513r/it513r-e.html#P178_25861
¶ 36. To support a personal tax credit claim for a non-resident spouse, child or grandchild, an individual has to provide (with the income tax return on which the tax credit is claimed) proof of the amounts contributed by the individual as support of the spouse, child or grandchild. Such proof will usually consist of receipts for post office or bank money orders, cancelled cheques that were payable to and negotiated by the spouse, child or grandchild, or receipts from private agencies established for the purpose of transferring money or goods to residents of other countries.

¶ 37. Receipts for cash or goods transferred directly from an individual to a non-resident spouse, child or grandchild are not considered acceptable proof of support.

Also is your spouse's income really $0 right now with absolutely no form of income in her country? No government payments? She is not receiving support from family members (i.e. by living with them in their home)? All of this will affect how much you would be allowed to claim. This is not an easy process, and if you proceed I would highly recommend using an accountant (not a do-it-yourself tax program) experienced with this.

 

[calvinw06]

Well before I met my wife she had a job working for the ex boss hotel business. But now they aren't hiring anymore cause the economy is so bad over there. 2015 to 2016 shes been jobless and is now too scared to even step out of her house. She just got robbed of her cellphone two weeks ago and I had to send her money again via the same process other wise I can't talk to her at all. Her wifi at home is on and off. She finally got another phone now with the money I sent her. Apparently everyone in Venezuela does this. Send money to someone that holds an american bank account to take advantage of the black market rate over the official rate. I spoke to someone from Venezuela on CanadaVISA going through this and he passed the interview stage and is coming to Canada now from Venezuela. But hey who knows if that's true right?

She does live with her parents, and she uses the money I gave her to help her family. The father is the only one working in the family and probably only brings in $20/ month. I'm not too sure if her corrupted government even gives out notice of assessment like Canada. I do have all the wire transfer receipts with me still.

 

[Rob_TO]

Well before I met my wife she had a job working for the ex boss hotel business. But now they aren't hiring anymore cause the economy is so bad over there. 2015 to 2016 shes been jobless and is now too scared to even step out of her house. She just got robbed of her cellphone two weeks ago and I had to send her money again via the same process other wise I can't talk to her at all. Her wifi at home is on and off. She finally got another phone now with the money I sent her. Apparently everyone in Venezuela does this. Send money to someone that holds an american bank account to take advantage of the black market rate over the official rate. I spoke to someone from Venezuela on CanadaVISA going through this and he passed the interview stage and is coming to Canada now from Venezuela. But hey who knows if that's true right?

She does live with her parents, and she uses the money I gave her to help her family. The father is the only one working in the family and probably only brings in $20/ month. I'm not too sure if her corrupted government even gives out notice of assessment like Canada. I do have all the wire transfer receipts with me still.

But the wire transfer receipts are not going to her. They're going to some other random person who would then be giving the money to her, which CRA specifically states in their rules is not allowed if you intend to claim spousal support on your taxes. Also since she lives with parents, that would need to be accounted for based on the cost of living in that country, and is somehow translated to an acceptable amount you can claim on your Canadian taxes.

Read the link I posted to above. As i said, this is a very complex tax credit you would be trying to claim and needs the advice of an accountant. Else the small amount you get back now, may not be worth it if you're eventually audited by CRA for not doing it properly.

Also note that whether or not you claim this credit is completely irrelevant to a PR application to sponsor her.

 

[calvinw06]

yes, I read the link. thank you again for that link. I don't think I'm going to claim it then. I'll just state that I'm married.

Oh I just thought if I applied, it might improve the chance of a genuine marriage, but I guess not.

But do you know if CIC also have the same restrictions? Like you said you found this fishy, CIC have no clue who I am and want evidence for me supporting her. If get a written letter from her ex boss, receipts from wire transfer, text messages supporting this between her and I. If there's link for this, that'll be helpful.