Non-residents are only taxed on Canadian-sourced income, such as earnings from businesses in Canada or rental income from Canadian properties. Canadian tax residents must report all global income, including wages, capital gains, and other income.
If you no longer live in Canada, you may be considered a 'former' Canadian (or non-resident), meaning you may no longer be considered a tax resident. In other words, you may no longer be required to file taxes in Canada.
A Canadian might not be required to file taxes in Canada if they:
- Permanently move to another country and sever residential ties with Canada.
- Establish significant residential ties in another country, such as purchasing a home or moving family members.
- Stay abroad continuously for a period typically over 183 days, showing intent to live outside Canada indefinitely.
If you tick one or more of the boxes above, you’re a non-resident and are only taxed on your Canadian-sourced income, such as earnings from businesses located in Canada or rental income from Canadian properties.
If you are a tax resident of Canada, you are obligated to report all global income, which includes not just wages earned, but also capital gains, and all other income from abroad.
For instance, if you earn CAD 75,000 working in Germany and another CAD 15,000 from investments in the USA, both amounts must be reported on your Canadian tax return.
However, the Canada Revenue Agency (CRA) sometimes provides relief through exclusions and credits. You should consult your accountant to get a detailed and precise list of the exclusions and credits you may qualify for.
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