Factual Residents Do You Know Your Canada Tax Obligations?

Factual Residents Do You Know Your Canada Tax Obligations?
Being out of country and enjoying the sunny weather while Canada is still battling what winter has to throw at her, and especially during tax season, certainly is a nice thought. In fact, it is easy to forget about the snow and the tax filings that will soon be due.   However, even if you spend several months out of the country if you are considered as a “factual resident” of Canada by the CRA, then you have the same tax obligations that you would normally have, and perhaps even a few more if you own foreign property.


Snowbirds often spend 6 months in the USA and the other 6 in Canada. Some that are new to this lifestyle don’t fully understand how this leaves them with their tax matters. To be considered as a factual residence you would have to be maintaining some type of residential ties here.   This could be a home, the ownership of property, or even have a spouse or common-law partner.


Being in this category you are obligated to pay and file your taxes just as any other Canadian tax payer. You have to report all of your income no matter whether it is from within the country or outside of it. Of course you are entitled to all the applicable deductions. Nor does the factual residence tax laws apply if you are a USA resident, or have a green card, or are classed as a resident of another country.
Your tax circumstances will change if you have been given permanent residency status in the USA.


If you now realize that you are classed as a factual resident you will need to fill out the CRA form T1248.


A lot of additional circumstances can arise if you are a Canadian traveller where you are out of Canada for any period of time on a constant basis.   Chances are you may have invested in property in the USA for example, and this affects your taxes here.    Perhaps you transferred funds or property to a non resident trust or have other dealings concerning this.


To be sure that you are meeting all of your Canada tax obligations as a snowbird then you may want to take advantage of our tax services here at Toronto Accountant.   We can deal with your travelling tax matters quickly and easily so you can enjoy your time away and know you have done right by your tax obligations.


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Sam Seidman, CPA, CA, LPA
629 Sheppard Avenue West
Toronto, Ontario
M3H 2S3

Telephone: (416) 398-1700
Fax: (416) 398-6226

Chartered Professional Accountant, Chartered Accountant, Licensed Public Accountant


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