As per the tax law of Canada and according to CRA the liability for income tax in Canada is based on the status as a resident or non-resident of Canada. Residency must be established before the tax liability to Canada can be determined. A determination of residency can only be made after all the factors have been considered. The circumstances have to be reviewed in their entirety to get an accurate picture of residency. Whether or not a person is a resident of Canada is determined by many factors. The amount of time spent in Canada is not the only factor considered.
A person who is a resident of Canada, and moves to another country, could still be considered to be a resident of Canada for tax purposes. If anyone left Canada in the year to travel or live abroad, see the Canada Revenue Agency (CRA) guide T4131 Canadian Residents Abroad.
Non-residents and deemed residents may or may not have to file a Canadian tax return. Much Canadian
source income will have had Canadian tax withheld when it was paid, and in many cases there is no requirement to file a Canadian tax return.
Residents of Canada are subject to Canadian income tax on their world wide income. World income includes:
1. Employment income
2. Income from self-employment
3. Income from investments (including rental income)
4. Income from business
5. Taxable capital gains
6. Number of additional miscellaneous sources of income
When a non-resident or deemed resident files a Canadian tax return, they are taxed at the current federal tax rates, plus a surtax of 48% of the federal tax, unless income was earned from a business with a permanent establishment in Canada. In this case, provincial or territorial tax is paid on that income.
For more information on who has to pay tax in Canada, and on what income, see the CRA guide or contact us Meade Accounting & Taxation at 905-669-1918 by phone, through our website http://www.meadetaxhelp.ca or in person at our offices 601 Edgeley Blvd., Unit 4 Woodbridge Ontario in Vaughan. We are located in the GTA north of Toronto east of Brampton and Mississauga south of Caledon, Bolton, Nobleton, Markham, Aurora & Newmarket. We are favorably located and able to provide our services to Toronto and GTA individuals and businesses. Meade Accounting & Taxation is committed to providing our clients with reliable and dependable tax preparation services, including personal, business & corporate income tax preparation services, accounting, bookkeeping and consulting services.
The information in this article and on this site is not intended to be a substitute for professional advice. Each person's situation differs; we encourage you to seek a professional advisor who can assist you in using the information on this web site to your best advanta