{"id":47,"date":"2014-01-29T06:58:05","date_gmt":"2014-01-29T06:58:05","guid":{"rendered":"http:\/\/capitaltaxltd.com\/canada\/?page_id=47"},"modified":"2021-02-25T17:32:19","modified_gmt":"2021-02-25T17:32:19","slug":"non-resident-tax","status":"publish","type":"page","link":"https:\/\/www.capitaltaxltd.com\/canada\/non-resident-tax\/","title":{"rendered":"Non-Resident Tax Advisory"},"content":{"rendered":"<div style=\"padding-bottom:20px; padding-top:10px;\" class=\"hupso-share-buttons\"><!-- Hupso Share Buttons - https:\/\/www.hupso.com\/share\/ --><a class=\"hupso_counters\" href=\"https:\/\/www.hupso.com\/share\/\"><img decoding=\"async\" src=\"https:\/\/static.hupso.com\/share\/buttons\/share-small.png\" style=\"border:0px; padding-top:2px; float:left;\" alt=\"Share Button\"\/><\/a><script type=\"text\/javascript\">var hupso_services_c=new Array();var hupso_counters_lang = \"en_US\";var hupso_image_folder_url = \"\";var hupso_url_c=\"\";var hupso_title_c=\"Non-Resident%20Tax%20Advisory\";<\/script><script type=\"text\/javascript\" src=\"https:\/\/static.hupso.com\/share\/js\/counters.js\"><\/script><!-- Hupso Share Buttons --><\/div><h1><span style=\"font-family: 'Times New Roman', serif;\"><b>Tax Services for Non-Residents<\/b><\/span><\/h1>\n<p><span style=\"font-family: 'Times New Roman', serif;\"> Non-Resident Tax for Canadian overseas. For tax purposes, you are considered a non-resident if you permanently live outside of Canada and you do not have any residential ties there. However, you may have some tax obligations to attend to and ensure that you are non-resident tax compliant. In order to confirm that you do not have tax obligations, it is recommended that you hire an accountant. The following are some areas in which a Vancouver accountant is beneficial for non-residents.<\/span><\/p>\n<h4><span style=\"font-family: 'Times New Roman', serif;\"><b>Tax Accountant Services for Non-Residents<\/b><\/span><\/h4>\n<ul>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Determine residency status of an individual or corporation<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Obtain an Individual Tax Number (ITN) or Non-Resident Tax Account Number (NR) or Business Number (BN) as required<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Open a GST\/HST account or payroll account if necessary <\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">File an NR5 application to have the amount of Non-Resident Tax Withheld Reduced<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">File an NR6 form for rental properties to remit non-resident tax based on\u00a0Net Income and not Gross Rents<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Attain Certificate of Clearance from Canada Revenue Agency<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Support your Canadian Lawyer with non-residency matters<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">File a Non-Resident Tax Return under Section 116, Section 216, Section 217 and Individual personal return or corporate as required<\/span><\/li>\n<\/ul>\n<h4><span style=\"font-family: 'Times New Roman', serif;\"><b>Tax Accountant Services for Individuals or Business Paying Non-Residents<\/b><\/span><\/h4>\n<ul>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Open an NR4 account<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Assist in Non-Resident Tax Withholdings and remitting requirements<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">File the NR4 Slip and Summary Information Return with Canada Revenue Agency<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Attain taxpayer relief for interest and penalties on omitted or late filed returns<\/span><\/li>\n<\/ul>\n<p><span style=\"font-family: 'Times New Roman', serif;\"><b>Taxation of Non-Residents<\/b><\/span><\/p>\n<p><span style=\"font-family: 'Times New Roman', serif;\">Non-residents pay tax on income received from sources within Canada. The type of tax and requirement to file depends on the kind of income received.<\/span><\/p>\n<p><span style=\"font-family: 'Times New Roman', serif;\">Canadian income received by a non-resident is subject to Part I tax or Part XIII tax. Unless there is a tax treaty between Canada and your home country reduces the rate, the Part XIII tax rate is twenty-five percent. <\/span><\/p>\n<p><span style=\"font-family: 'Times New Roman', serif;\"><b>Part I Tax<\/b><\/span><\/p>\n<p><span style=\"font-family: 'Times New Roman', serif;\">The most common type of Part I Tax is if you sell or transfer taxable Canadian property, which includes real estate.<\/span><\/p>\n<p><span style=\"font-family: 'Times New Roman', serif;\">When purchasing Canadian real estate from a non-resident, individuals have an obligation to withhold and remit twenty-five percent of the gross sale proceeds with respect to the purchase. When the real estate is depreciable property, such as a building use for rental or business purposes, this liability increases to fifty percent. <\/span><\/p>\n<p><span style=\"font-family: 'Times New Roman', serif;\">The Canada Revenue Agency can enforce this liability for any purchaser who fails to withhold the tax, unless they had no reason to believe that the non-resident was not a Canadian resident. It is standard for the purchaser\u2019s solicitor to either require the vendor to certify in writing as to the Vendor\u2019s Canadian residency status or require withholding of this tax.<\/span><\/p>\n<p><span style=\"font-family: 'Times New Roman', serif;\"><b>Certificate of Clearance<\/b><\/span><\/p>\n<p><span style=\"font-family: 'Times New Roman', serif;\">If the Vendor obtains a \u201cCertificate of Clearance\u201d from the Canadian Revenue Agency on a timely basis, the withholding tax can be reduced or eliminated. The form must be filed with the Canada Revenue Agency in advanced of the disposition or within 10 days thereafter. <\/span><\/p>\n<h2><span style=\"font-family: 'Times New Roman', serif;\"><b>Part XIII Tax<\/b><\/span><\/h2>\n<h3><span style=\"font-family: 'Times New Roman', serif;\"><b>Canadian income subject to Part XIII tax are:<\/b><\/span><\/h3>\n<ul>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Rental and Royalty payments<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Management fees<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Dividends<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Old age security pension<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">Canada Pension Plan and Quebec Pension Plan benefits<\/span><\/li>\n<\/ul>\n<h4><span style=\"font-family: 'Times New Roman', serif;\"><b>When the income is paid or credited to the individual, Canadian payers must deduct Part XIII tax.<\/b><\/span><\/h4>\n<p><span style=\"font-family: 'Times New Roman', serif;\">An individual can elect to file a Canadian Income Tax Return for income which Part XIII tax was deducted when:<\/span><\/p>\n<ul>\n<li><span style=\"font-family: 'Times New Roman', serif;\">The individual receives Canadian rental income or timber royalties; and<\/span><\/li>\n<li><span style=\"font-family: 'Times New Roman', serif;\">The individual receives certain Canadian pension income.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-family: 'Times New Roman', serif;\">It may be beneficial to file a Canadian Income Tax Return so that the individual may receive all or some of the Part XIII taxes paid.<\/span><\/p>\n<h4><span style=\"font-family: 'Times New Roman', serif;\"><b>Payment to Non-Resident<\/b><\/span><\/h4>\n<p><span style=\"font-family: 'Times New Roman', serif;\">If the individual is the Canadian Payer to a non-resident, the individual is responsible for withholding and remitting Part XIII tax, and to report the income and withholding tax on an NR4 information return.<\/span><\/p>\n<p><span style=\"font-family: 'Times New Roman', serif;\">The NR4 information return is due by the last day of March following the calendar year.<\/span><\/p>\n<h4><span style=\"font-family: 'Times New Roman', serif;\"><b>Failure to Deduct<\/b><\/span><\/h4>\n<p><span style=\"font-family: 'Times New Roman', serif;\">individual may be assessed a penalty of ten percent of the required amount of Part XIII tax failed to deduct. Repeat offenders may be penalized twenty percent. <\/span><\/p>\n<h4><span style=\"font-family: 'Times New Roman', serif;\"><b>Filing a Income Tax Return<\/b><\/span><\/h4>\n<p><span style=\"font-family: 'Times New Roman', serif;\">An individual must file a Canadian income tax return if you owe tax for the year, previously filed a NR5 form to reduce required taxes withheld, had a taxable capital gain or disposed of taxable Canadian Property or if the individual wants to claim a refund.<\/span><\/p>\n<p>Check out the following articles on Non-Resident Tax for Canadian overseas.<\/p>\n<p><a href=\"https:\/\/www.capitaltaxltd.com\/canada\/2016\/02\/09\/can-canadians-live-tax-free-abroad\/\">Can Canadians Live Tax-Free Abroad?<\/a><\/p>\n<p><a href=\"https:\/\/www.capitaltaxltd.com\/canada\/2015\/10\/16\/tax-considerations-for-canadians-moving-south-of-the-border\/\">Tax considerations for moving south of the border<\/a><\/p>\n<p><a href=\"https:\/\/www.capitaltaxltd.com\/canada\/2015\/02\/19\/how-to-minimize-taxes-on-your-canadian-rental-income-while-living-abroad\/\">Rental income in Canada when you are living abroad<\/a><\/p>\n<p><a href=\"https:\/\/www.canada.ca\/content\/dam\/cra-arc\/formspubs\/pbg\/nr73\/nr73-17e.pdf\">Determination of Residency Status CRA<\/a><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Tax Services for Non-Residents Non-Resident Tax for Canadian overseas. For tax purposes, you are considered a non-resident if you permanently live outside of Canada and you do not have any residential ties there. However, you may have some tax obligations to attend to and ensure that you are non-resident tax compliant. In order to confirm [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":1152,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"footnotes":""},"class_list":{"0":"post-47","1":"page","2":"type-page","3":"status-publish","4":"has-post-thumbnail","6":"entry"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v15.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<meta name=\"description\" content=\"We can help Non-Resident Tax for Canadian overseas. 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