Answers Archive

Canadian residing in USA on TN visa, investing in real estate in USA

Hi Tippu, LLCs cause double taxation for Canadians. Instead of forming a LLC to purchase rental properties, setup a US Limited Partnership to make the purchases. A US LP is treated as a flow through entity for both US and Canadian purposes, and provides liability to protection to limited partners, similar to a LLC.

Canadian Company, Canadian Employee, Canadian Dollars, working remotely, temporarily, partially – tax implication with the IRS??

Hi Kay, You should file a US tax return (1040-NR) with the IRS to report the portion of your total wages that relate to the work that you physically performed in the US (i.e. 20% of total wages in your case). On your Canadian return, you will be taxable on your worldwide income. In order … Continue reading

Non capital Loss transfer

Hi Leah, Assuming that you amalgamate the two companies, the new amalgamated corporation can carry-forward the losses of the predecessor corporations, but not back.

How To Treat Dividends And Licensing Fees On Corporate Tax Return

Hi, Cash dividends paid need to be reported on the balance sheet (GIFI Schedule 100) and on Schedule 3. Report licensing fees as other operating expense on GIFI Schedule 125.

T5 Issued to Non Resident of Canada

Hi, Do not file a Canadian tax return. Non-residents of Canada are not supposed to file a Canadian return to report interest income. Even though the bank issued the wrong slip, withholding tax does not apply to interest payments made to non-residents of Canada. Going forward, ask your bank to issue a NR4 Slip for … Continue reading

Canadian Non Resident in Australia

Hi, As a non-resident of Canada, you are only taxable in Canada on your Canadian employment income. Your Australian income is not taxable in Canada. However, for the purposes of determining your eligibility for Canadian tax credits, you must report your Australian income on Schedule A – Statement of World Income. If more than 90% … Continue reading

what happens if we leave shares in our trading accounts after declaring non residency

Hi, Now that you have officially decided to stay in the US, you should file a departure return with the CRA for the 2018 tax year. Departure tax does not apply to TFSA, RRSP, Cash or GICs. I suggest that you close down your TFSA, because TFSAs are taxable in the US and have additional … Continue reading

Loss and profit of Stock, Dividend

Hi Vahid, Purchases an sales of stocks, bonds and mutual funds should be posted to the Marketable Securities account (current asset). Dividends received should be posted to a Dividend Income account.

Subcontracting for a sole Proprietor Business

Hi, Incorporate a company in Canada to minimize your liability and to save tax. Hire subcontracts through your Canadian corporation. You will not have to pay US profits tax if your Canadian company does not have a fixed place of business in the US and you do not spend more than 6 months in the … Continue reading

Selling Proceeds

The problem is that both of your names are on the property, but your mom is the one who wants to claim the principal residence exemption for the entire gain. As it is right now, this is not possible. To solve the problem, a bare trust should be created. The bare trust will specify that … Continue reading

How can i record h r from past years

If your company has received a reassessment for additional HST owing relating to prior tax years, then record the additional HST as an expense on the company’s income statement for the current period.

minor kids received INR cash as gift from grandparents

Hi Falcon18, Any traveller bringing cash into Canada over $10,000 must declare it with Canada Customs, regardless of the traveller’s age. However, for tax purposes, gifts are not taxable to the recipient.

Re-established in Canada & Selling Internet Domain

The domain name has to be revalued to its market value on the date that you came back to Canada. The market value becomes the cost basis for Canadian tax purposes when computing the capital gain upon sale.

Are there any tax benefits of being a tri-citizen of canada, australia and ireland?

Hi Aidan, From a tax perspective, you can only be a tax resident of any one of these 3 countries at a time, even if you are a citizen of all 3.

starting a freelance business

Hi, I suggest that you start as a sole proprietor. It is less expensive than incorporating in terms of setup costs, and ongoing tax & accounting compliance. If your business becomes successful, I suggest you incorporate, because you will save tax and the savings will more than offset the costs. To free up cash-flow, consider … Continue reading

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