Published On: Mon, Jul 18th, 2016

Canadian overseas income tax exemptions could affect you

Share This
Tags

Canada is one of the most popular countries for immigration. In light of a possible Trump presidency, more and more people are threatening to leave the US for Canada. Still, there are also over 1.5 million Canadians living and working abroad.

As with most expats who work abroad, Canadians need to understand the laws concerning taxation on their foreign-earned income.

Canada is a little more moderate than the United States when it comes to taxing its offshore citizens and residents. In fact, Canadian tax courts are known to be more flexible. During the contestation process they consider each case on its individual merits.

Canada uses a “hybrid tax system“, a combination of territorial taxation and taxing on worldwide income. Consequently, it is important to understand the nuances of the system. While most Canadians expect to be taxed on their worldwide income, there are exceptions.

Canadian flag in front of the beautiful city of Vancouver, Canada.

Canadian flag in front of the beautiful city of Vancouver, Canada.

For instance, consider the story of David, a foreign-born Canadian resident who had to return to his home country to take care of his aging parents. While his immediate family lived in Canada, David lived abroad to see after the daily needs of his parents. While living in his country of citizenship, David took on a part time job. And — even though he earned his income abroad — he paid Canadian income taxes each year.

One day, however, his wife read an article from the local Canadian expat community. The article explained that, in some cases, income earned abroad could qualify for Canadian tax exemptions. To make a long story short, their situation was one of those cases and David was able to exempt his foreign-earned income.

 

Click here for full article

Source: http://nomadcapitalist.com/

Corpofaciales

corpofaciales-down

Comments

comments

Leave a comment

XHTML: You can use these html tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>