Back Tax, New Canadian Resident / Non-Resident Tax
For income tax return purposes, you are considered a newcomer for the first tax year that you become a new resident of Canada. As a newcomer to Canada, there are certain rules and regulations that must be adhered to when filing your tax return. Often, newcomers to Canada are unaware of their tax filing obligations and don’t file a tax return; consequently, resulting in back tax issues.
As a resident of Canada, you must file an income tax return if your owe tax or if you want to claim a tax refund. Even if you do not have any income to report or tax to pay, you must file an income tax return to remain eligible for certain tax payments or tax credits. These tax payments include HST credits, Canada child tax benefits and tax payments from select provincial programs.
General Income Tax and Benefit Package
When filing your income tax return, be sure to use the 'General Income Tax and Benefit Package' for the province or territory you reside in as of December 31st of the tax year. This is important because tax rates and tax credits vary in each province and territory. It should be noted that if you live in the province of Quebec, you may need to file a separate provincial income tax return.
Income Tax Filing Deadline
Income tax returns must be filed on or before April 30th of the following year. If you conducted business in Canada, your return must be filed on or before June 15th of the following year. Any outstanding back tax balances have to be paid on or before April 30th, regardless of the due dates above. If you have back taxes, you may incur penalties as a result of the late filing.
When reporting income, you must pay Canadian income tax on Canadian source income for the part of the tax year that you were NOT a resident of Canada. You must report income from employment/business in Canada, taxable capital gains from disposing taxable Canadian property and taxable portions of scholarships and grants received from Canadian sources.
For the part of the tax year that you WERE a resident of Canada, you must report your total world income earned after becoming a Canadian resident on your Canadian tax return. Canada has tax treaties with certain countries which means pension income from outside of Canada may be exempt from tax. This income must still however be reported on your income tax return.
As a newcomer to Canada, don’t wait to file your back taxes; reduce the tax penalties and interest and file on time. Attempting to handle your own tax issues can be hazardous to your tax health. As a new Canadian resident, you want to start off on the right foot. The tax accountants at Tax Doctors Canada will make sure you have the best in income tax services - whatever your Canadian resident / Non-resident tax requirements - and maximize your tax savings.
Tax Doctors Canada offers a stress free Initial No Obligation Phone Consultation with one of our professionally certified tax accountants. We Welcome Your Business!
Tax Doctors Canada has 3 office locations (by appointment only) in Toronto, Markham and Mississauga to serve you. You can also have one of our certified tax accountants assist you with your personal tax return requirements remotely from the comfort of your home utilizing Tax Doctors Canada's secure document transfer portal. We accept clients from Canada and worldwide.