Re: Goodbye Canada Hello Capital Gains Tax
 

Income taxes have nothing to do with capital gains taxes. It is perfectly possible to sustain a capital gain or loss simply on the exchange rates at deemed (or other) acquisition and deemed disposal. But if you have a capital loss you can only offset is against other capital gains (if any), but not against income.

Re: Goodbye Canada Hello Capital Gains Tax
 

Quite. I think the poster may soon have 100problems. :)

Re: Goodbye Canada Hello Capital Gains Tax
 

CRA can't audit an asset held overseas. Grow up and get off your high horse.

I'm aware income taxes aren't related to CGT but the income derived from the asset was derived in UK currency so the argument is linear in demonstrating that any "gain" would also be in UK pounds so the conversion might incur a loss by itself. Next week I'll show you how to lace your shoes.

Re: Goodbye Canada Hello Capital Gains Tax
 

You're a very pleasant person to have a chat with. While you're lacing your shoes the next time, take a moment to think about what currency fluctuations on income sourced abroad have to do with Capital Gains.

Obviously you need to report your worldwide income to the CRA, converted to Canadian dollars. Do not assume that CRA will not check out the source of that income.

Or, if you like, assume they won't. I don't GAF.

Re: Goodbye Canada Hello Capital Gains Tax
 

You're naïve. CRA investigated where all my income was derived from, foreign assets, cash transferred to Canada, how I paid for the business assets etc etc. 3 days sat in my office, then 3 further months before I got my paperwork returned.

I hope you wear slip-ons.

Re: Goodbye Canada Hello Capital Gains Tax
 

:rofl:

Re: Goodbye Canada Hello Capital Gains Tax
 

:rofl: Indeed. But on a more abstract point. What is the CRA's intention with this new T1135 form?

Why are they interested in assets (e.g. bank accounts) held abroad?

Is it only to do with ascertaining sources of worldwide income or is it more strongly connected to potential CGT issues?

Re: Goodbye Canada Hello Capital Gains Tax
 

Same here! We have a small business and in the 3rd year had an audit. The most nerve wracking experience ever!

For what it is worth, we never gave CGT a thought and declared our property in our taxes in the first year and after a couple of years chose to pay tax on the rent in Canada and not UK (tax agreements in place between countries) and although it has increased dramatically since in value, we can only offset what we have spent on actually improving the property so apart from new double glaze windows and a boiler which we can off-set, any white goods we put in or painting etc we cannot because that is maintenance.

Re: Goodbye Canada Hello Capital Gains Tax
 

Probably so many Canadians have accounts off-shore somewhere and are not declaring the interest earned or money stuck away in them and they are after the extra cash! As if we don't have enough tax to pay! Especially on that bottle of wine (or bottles) I have been consuming this week!

Re: Goodbye Canada Hello Capital Gains Tax
 

I remember getting the call and wondering what the hell there was to audit after only 3 months of trading. A request for $100k of GST refund obviously rang alarm bells for them, so they decided to pay a visit. Nerve wracking indeed - can't help second guessing yourself and wondering if everything's in order, particularly so early into a business venture in a new country. I'd not even had a chance to employ a book keeper or accountant.

Re: Goodbye Canada Hello Capital Gains Tax
 

Dummies.

Re: Goodbye Canada Hello Capital Gains Tax
 

You might find the tax guide for dummies useful. :)

Re: Goodbye Canada Hello Capital Gains Tax
 

Like your style Rich. You were most unfortunate to get audited before you'd even filed for the first year - seems a bit aggressive but even HMRC are going that way.