nicolar001

Excuse my ignorance, I just need clarification on a couple of things. Appreciate your help.

1) Am I understanding correctly that income tax is paid in the same manner as the UK i.e direct from your salary?

2) I've read on Wiki that we must complete a form to declare foreign income from property....is this rather like a self assessment form that we just send to the tax department?

3) and regarding income from foreign property......if we do not receive any money from the property but instead use it all to pay the mortgage (over and above the necessary amount) do we still have to pay tax?

I hope that makes sense.
Thanks

Silverdragon102

You still have to complete forms, can be done self online or use companies/accountants. Sometimes you get money back or you have to pay a lump sum

plasticcanuck

All Canadian residents are required to file an annual Income Tax Return in which they must declare total worldwide income. If employed, income tax will be deducted at source. Other income such as rentals, investments etc will require declaring upon filing of the Return.

not2old

As stated above, unlike the UK, in Canada a resident is required to submit a yearly tax return.

Revenue Canada chases folk that do not file as well as impose penalities for late filers

The tax year is the same as the calendar year, so be prepared to have it done & submitted by April 30 each year

Former Lancastrian

Can anyone confirm that if you have submitted your tax return and you owe the CRA money you can pay the amount owed in Canadian Tire dollars?

DandNHill

Young man you still have a lot to learn about Canada. Only Optimum points can be used.

not2old

special discounts for seniors on the CRA tax bill.

On the optimum points even better on seniors day or with 20x bonus points, your tax bill could be free, now what is that about a free movie?

Of course the other option is paying the tax bill with Pioneer gas station bonus points

nicolar001

Thank you everyone for that clarification. I suppose it will all become clear once we are there and begin the process.

Siouxie

On a more serious note, you also have to declare assets valued at anything over $100,000 (individually or combined) - so if you have a house, get a valuation done before you leave (and the ability to obtain proof of rental income, expenses etc) as there are huge penalties if you don't declare.

You can read more on taxation in Canada on Revenue Canada's website: Newcomers to Canada (immigrants)

MarkG

Yes, but these days they prefer iTunes gift cards.

scrubbedexpat091

Don't they really just chase folks who owe money?

I've been late a few times filing, I never owe though and never been penalized.

So do they only penalize if your late and owe money?

Aviator

Depends how much you owe. Interest continues to accrue.

Late filing only has a penalty and interest if you owe taxes. If you are late filing, I have not know them chase folks up, but if you receive some benefits based on income, failure to file will result in these stopping. Some have to be reapplied for, others eventually start up some weeks after filing.

JonboyE

Tax will be deducted from your salary. You self-declare your allowances to your employer. The amount deducted is approximate. You must complete a tax return to calculate your final tax liability.

It is a T1135 form that you file with your tax return. You don't need to file this for the year you first become tax-resident in Canada bit must do so for every subsequent year that you own specified foreign assets with a cost of $100,000 or more.

You pay tax on any profit you make. Mortgage interest is a deductible expense. Repayment of the principal is not.

nicolar001

Thanks for the info. So, if we would never have any allowances, we still need to do the tax return.....but it should presumably mean we don't pay any extra tax to what has been deducted from our salary throughout the year. (Im talking as if we had no investments or profits from other sources)

Have I understood that correctly?

AmanSood

Hi Nicolar001, that's correct. If your only source of income during the tax year was employment income i.e. salary and your employer has correctly taxed this via the payroll then there shouldn't be a need to file a UK tax return. There can be exceptions for example if your tax code is incorrect or if you have left the UK as you may be due a tax refund and in this case worth filing a return.