Am I a tax resident of Canada?
Being a permanent resident or a citizen of Canada is not the same as being a tax resident of Canada. This is because you may not be domiciled for a few years in Canada and still you may be considered a tax resident of Canada.
How do I become a tax resident of Canada?
To become a tax resident of Canada, you need to be domiciled in Canada and work and earn a living in Canada. However, under exceptional circumstances, you may be deemed tax resident of Canada if you have significant and/or secondary ties to Canada, even though you no longer live or work in Canada.
Significant residential ties to Canada include:
- a home in Canada
- a spouse or common-law partner in Canada
- dependants in Canada
Secondary residential ties that may be relevant include:
- personal property in Canada, such as a car or furniture
- social ties in Canada, such as memberships in Canadian recreational or religious organizations
- economic ties in Canada, such as Canadian bank accounts or credit cards
- a Canadian driver's license
- a Canadian passport
- health insurance with a Canadian province or territory
- To determine residence status, all of the relevant facts in each case must be considered, including residential ties with Canada and length of time, object, intent, and continuity while living inside and outside Canada.
Are Soft Landers liable to pay taxes in Canada?
Soft landers are not tax residents of Canada and are not liable to taxes unless they meet the significant ties test. For example, if you soft-land in Canada and then return to your home country but however if you leave behind your spouse in Canada, you will meet the significant ties to Canada test and would be deemed a tax resident of Canada.
May 19th, 2020