Determine Your Residency
What to Consider | Tax rules | How it effects | Who are they | Status |
a.Residential Ties | Physically present, have established residential ties | No effect. Regular filing. Required to disclose world income | Ordinary resident | Resident |
a. Residential ties b. Calendar year | Have not established residential ties or severed residential ties. Physically present in Canada for 183 days or more during the calendar year. However, Tax payers who become deemed residents after February 23, 1998, but who are residents of another country under a tax treaty, are treated as non-residents regardless of 183-day rule. | No effect. Regular filing. Required to disclose world income | Canadians working overseas (Canadian forces, diplomats) | Deemed resident |
a. Residential ties and b. Intention of taxpayer to maintain residential ties. | Not physically present. Live or study in another country for study or employment, but have intention to return after the temporary period of study or employment. | No effect. Regular filing. Required to disclose world income. | Students studying abroad, a person employed outside Canada | Factual resident |
a. Residential ties b. Calendar year | Not established residential ties. Not physically present in Canada for 183 days or more during a calendar year. | No non refundable tax credit, Transfer amounts, Education amount, Medical expenses are allowed. CPP, EI premium, Disability amount for self, Interest on student loan, Tuition fees, Donation and gifts, taxable portion of scholarships and bursaries are allowed if Canadian source of income is reported. They should not report income received prior to establishing residency (NR4 is issued in such cases). International students also may claim moving expenses for eligible studies in Canada as against the bursaries, scholarships or research grant. | International students, visitors, workers on temporary assignment | Non- Residents |
a. The date a taxpayer “landed” in Canada b. The date a taxpayer emigrated to another country c. Intention of the taxpayer to establish residential ties d. Calendar year | Physically present part of the year | Proration is required for (all the non-refundable tax credits) the part of the year in which a person was non resident (in the case of migration) or (resident in the case of emigration) Provincial credits are not subject to proration. CPP, EI premium, Disability amount for self, Interest on student loan, Tuition fees, Donation and gifts are allowed if Canadian source of income is reported for the part of the year a person is non-resident or ceased to be a resident. No moving expenses are allowed. Support payment made to non-residents are either deductible or non deductible under the usual rules governing support payments. This means supporting dependents are not usually means support payments for tax purpose. | Immigrant and Emigrant | Part year Resident |
Terms that are used in this chart and related topics
Residential ties means
- A home
- A spouse or dependents
- Have personal property, such as a car or even furniture
- Social ties (such as professional memberships, club memberships etc.)
- Driving license
- Bank accounts, credit cards, mortgage accounts, etc.
- Medical insurance
Temporary period
CRA presumes anything less than two years to be temporary
Permanent period
A period of two years or more is presumed to be permanent
Calendar year
From January 1 to December 31
Proration
No. of days/365 days x corresponding amount
Canada Child benefit
If you are a Canadian resident, a visitor or permit holder in Canada who was resided in Canada throughout the preceding 18-month period, a convention refugee whose refugee claim is approved by the eligible authority and you have a child under 18 years of age you may be eligible to receive Canada Child Benefit (CCB) .