# Question for Canadians regarding taxes



## DXB971 (Sep 8, 2009)

As a Canadian citizen I understand I don't have to pay taxes in Canada on my international income when working in Dubai. If I decided to move back to Canada after working in Dubai for 3-5 years then what should I say when filing my first tax refund after returning?


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## NickZ (Jun 26, 2009)

The first question is are you a deemed Canadian tax resident or not?

CCRA on their website has a form you can fill in and send into the international office. They'll give you an opinion on your tax status. If you have enough links left to Canada you might still be a Canadian tax resident. With all the tax obligations. 

If you aren't a tax resident then not a big issue. On the point you return and need to fill in a tax form I'm fairly sure near the top it'll have a place to put in your date of return. Unless the form has changed lately.


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## Elphaba (Jan 24, 2008)

Hopefully you didn't full in CRA form N73 before leaving as that is genernally not advised so you won't know if you are treated as no-resident. The CRA make it very hard for non-resident Canadans to know where they are in terms of tax liability on overseas income upon return.

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## Sumair (Aug 16, 2008)

I dont think your assumption is correct ... you need to pay tax till the time you are not becoming non-resident ... 

You are deemed to be resident if you have significant ties with canada like:

your family is in canada
you have property
loan
mobile connection
taking any tax benefit 
list is long...






DXB971 said:


> As a Canadian citizen I understand I don't have to pay taxes in Canada on my international income when working in Dubai. If I decided to move back to Canada after working in Dubai for 3-5 years then what should I say when filing my first tax refund after returning?


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## movinmary (Jan 21, 2010)

you can own property in Canada and not pay taxes. As for the ties....yes you are correct, mobile phone, library card, insurance for a car. It is a long list so cut all ties but again you can own property!!!


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## Elphaba (Jan 24, 2008)

movinmary said:


> you can own property in Canada and not pay taxes. As for the ties....yes you are correct, mobile phone, library card, insurance for a car. It is a long list so cut all ties but again you can own property!!!



Of course you _can_ own property,but it is one of the things taken into consideration when determining residency.

This article may be of use to expat Canadians

Remember to guard against possible northern tax exposure - The National Newspaper

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## mcd1203 (Nov 25, 2008)

we hired a tax company that deals with expats that way they are dealing with it all. you have to be a non resident for at least 2 years to qualify for not paying taxes upon your return. If you're married the non residence status goes by when the rest of your family leaves the country. You can own property but the best thing to do is rent it out through a rental company that way its done at "arm's length"


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## iansari (Jul 14, 2009)

mcd1203 said:


> we hired a tax company that deals with expats that way they are dealing with it all. you have to be a non resident for at least 2 years to qualify for not paying taxes upon your return. If you're married the non residence status goes by when the rest of your family leaves the country. You can own property but the best thing to do is rent it out through a rental company that way its done at "arm's length"


The length of your stay outside Canada is not important. What is key is your intention. If you declare non residency by following all the right procedures then even if you are forced to come back in less than a year (for whatever reason) you will not be taxed.

As others have stated to ensure that you are deemed a non resident for the duration you are outside Canada, you must ensure that you break all MAJOR ties with Canada. These include:

- Selling your house OR renting it to someone at arms length (i.e. not a family member. Sign a contract to be safe). If you keep a house, you MUST rent it. Leaving it un-rented will cause you to be considered a resident for sure. 
- No car
- No cell phone
- No spouse/children (in Canada!)
- No provincial health insurance (this is key. If the government thinks that you were using public services without paying taxes you are screwed!)
- No child tax benefits (or any other tax/government credits of any kind)

You can generally keep a credit card, one non-resident bank account and your drivers license. While these items are on the official list of "ties" to Canada, most accountants will tell you that this is ok.

Also once you are a non-resident, you must pay 25% "withholding" tax on ANY income in Canada. So if you are renting out your house, then the 25% tax will apply to that rental income. This is another key "test" of your non-residency. Not paying this will get you into trouble when you come back. Also this withholding tax needs to be paid immediately upon receiving the income (for rental, the cut-off is 1 month from the date you receive it I think). Otherwise you will get charged interest. To pay this tax you will need to get a Non resident number from CRA's international tax office and declare an "agent" in Canada who will pay this on your behalf (usually your accountant will do this).

In short, there's quite a bit to be done to ensure that you are deemed a non-resident in Canada and that CRA doesn't come after your international income once you get back. 

Best advice is to get a professional accountant. Well worth the money!

Also have a look at the CRA's website for some additional details: (Non-residents of Canada)


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