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| *Ostroff, Fair and Company>>>Canada Taxes |
If you work in Canada, are you required to pay Canadian taxes, I am a US citizen.? |
I worked in Canada for one year(2003). I did not file Canadian taxes even though they withheld over 9,000 dollars. Last week I got a notice that I owed more taxes. If you are resident in Canada and have Canadian-source income, you will owe taxes in Canada. That's the bad news. The good news is that the taxes you pay in Canada are deductible in the US. As a US citizen working abroad the tax situation can be *very complicated*. I highly recommend that you get professional tax advice since you could end up saving a lot of money. According to this website, the answer is yes, income earned in Canada is taxed there. Check with an accountant; you may be able to deduct those taxes from your US taxes. http://www.escapeartist.com/passports/pa... If you lived and worked in Canada, then yes, you have to pay taxes. If CRA says you owe them money, you should deal with it quickly as they charge 10% interest on late payments. I was in the reverse of this situation (Canadian living in US). Canadian income taxes are based on residency only. If you are deemed to be a Canadian resident, then you owe income taxes. Period, end of story. The question is whether or not you are deemed to be a resident. There is a rule, called the 183-day rule, that specifies that if you resided in Canada for more than 183 days in the calendar year, then you are deemed to be a resident, and so you have to pay taxes. Count up how long you were in Canada, and see if it was more than 183 days. If not, write to Canada Revenue Agency, with a description of when you entered and left the country and include photocopied documentation to help your case. If you are over 183 days, then you have to figure out how much you owe, if any. Remember that as a Canadian resident, you owe income taxes on your WORLDWIDE income, not just Canadian income. Include it all, but make certain that you claim the foreign tax credit if you filed a US return and paid tax - that may help out some. If you have any questions, start with either a Canadian H&R Block office, or an accountant that deals with Canadian returns. I wish you the best of luck. |
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