jad n rich

Thought I would take my mind off stuff by reading some Wiki articles and posts...

Got to taxation, now it sounds like if you bring money/assets over to Canada after your landing date you are subject to tax on it.

EG. Our currency - aussie rupee:curse: has devalued 20% to CND in the 6 weeks after we started this. So if we hold off, then bring it over if it recovers, we then pay tax on it. Same with assets?

Or have I got this wrong.

This emigrating is a sure way to go broke isnt it

PaulandNikki

Not quite right
AFAIK you can bring your money in at any time and pay no tax on it.
As for your goods, you can bring anything that is on your Goods to Follow list at any point in the future and pay no tax on it. If you miss it off the list then you will pay tax when you import it so make sure you list *everything* even if you don't think you'll bring it over.

Judy in Calgary

I think jad n rich is referring to the fact that, if you leave behind a pot of money in the UK or Australia or wherever on the day that you become a tax resident of Canada and later transfer that money to yourself in Canada, the gain or loss that you incur on foreign exchange between the two dates is considered to be a capital gain or a capital loss.

If you incur a capital gain, it is subject to capital gains tax. However, capital gains tax is on 50% of the capital gain.

Conversely, if you incur a capital loss on the transfer of your money, you can enter a loss on your income tax return.

This is briefly explained in the Wiki article called Currency Exchange Gains and Losses-Canada.
x

Judy in Calgary

I hear you.

This is the kind of thing I was referring to when I said in the Another complicaton - help? thread that migrating in middle age (or thereabouts) was not the same thing as backpacking around the world in one's early twenties.
x

jad n rich

Exactly

In our most probable situation, partner would go first on a TWP, I would be stuck downunder trying to sell the house. Therefor assets would certainly be transferred later. So does the TWP date count as date of arrival, and therefor the date you get taxed from, or does the day you get PR count. I mean seriously who would transfer worldly assets lock stock and smoking barrel on a TWP anyway.

Probably another complication here is my open work visa if I dont arrive till X amount of months later, would I even get one. Great start deported on arrival

Remind me why did I start this

Judy in Calgary

If you still owned a house in Australia and you were living there, I think the tax authorities would consider you to be tax residents of Australia, even if your partner had started working in Canada. I think they would consider you to be tax residents of Canada from the time that you joined your partner in Canada.

The general idea is that, in order to be tax residents of Canada, you have to have severed your residential ties with the other country. If the couple owns a house in the other country, and if one partner still is living in that house, the couple usually is not deemed to have relinquished residential ties with that country.

There is some more info in the Wiki article called Tax Residency-Canada.

But I'm not a tax expert, and on all questions related to this topic I will defer to JonboyE, who is an accountant.

If you follow your partner to Canada later, even months later, you can apply for a spousal open work permit (SOWP) at your Canadian port of entry (POE). When you land at your POE, you should have the following with you:

• passport (which would be necessary even if you were a tourist)
• two photos
• means of paying the fee ($150 last time I checked)
• copy of your partner's valid work permit
• copy of your partner's employer's Labour Market Opinion (not required but nice to have)
• evidence that your partner works in Canada (letter from employer and a few pay slips)

Several members of this forum have done it that way.
x

JonboyE

This is an interesting one, which will also apply to Brits going direct to Canada.

I'll assume jad n rich are a couple and not just business partners. They could become tax resident in Canada from the moment the first arrives here on their TWP, or the moment the second arrives, or somewhere in between. The Canada - Australia tax treaty says:

. Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his status shall be determined in accordance with the following rules:

a) he shall be deemed to be a resident solely of the Contracting State in which he has a permanent home available to him;

b) if he has a permanent home available to him in both Contracting States, or if he does not have a permanent home available to him in either of them, he shall be deemed to be a resident solely of the Contracting State with which his personal and economic relations are the closer.


If the first partner sets up home on arrival in Canada then someone has got to make the determination of when the couple's personal and economic relations are the closer to Canada than Australia. Good luck to whoever has that task.

Anyway, that's the theory. In practice the first partner will become tax resident in Canada the moment they arrive on their TWP, and the following partner will become so when they arrive later. If the house sells in a reasonable time (say less than six months) then I don't think anyone is going to be all that bothered. You could certainly make a good argument that, as a couple, they did not become tax resident in Canada until their permanent home (and home of the second partner) in OZ was sold.

MB-Realtor

In Canada (& Manitoba) a Husband & Wife (or same sex partners) can have separate principle residences for tax purposes.

JonboyE

Under Federal tax law a family can only have one principle residence. I would be surprised if Manitoba had different rules.

¶ 6. For a property to be a taxpayer's principal residence for a particular year, he or she must designate it as such for the year and no other property may have been so designated by the taxpayer for the year. Furthermore, no other property may have been designated as the principal residence of any member of the taxpayer's family unit for the year.

http://www.cra-arc.gc.ca/E/pub/tp/it...html#P80_10811

MB-Realtor

I had been told (not long ago) by an accountant that Individuals could designate a property as their residence for tax purposes.

Tax law is stupidly complicated, I will dig around and see if I can get more information.

johnh009

Just to complicate things even further, prior to 1981, each family member could claim a capital gain exemption on the sale of a property but this rule has now been abolished. This obviously applies to second properties.

That is where your information may originate. Otherwise current federal tax law states one principal residence per family unit.