Going down South?

December 13th, 2012

It is the time of season when a number of people do what Canadians do best. ¬†Travel south for the winter. ¬†Since I’m stuck in my office for the entire winter, I will at least bid you a fond farewell and remember to come home in the spring.

I’m also going to take it one step further and remind you of your potential tax requirements. ¬†I hate to ruin a winter vacation for anyone, but if you don’t want a nasty tax surprise it might be wise to plan ahead.

First, take a look at the Canada Revenue Agency’s P151, Canadian Residents Going Down South. ¬†It’s written in good plain English. ¬†Here’s a quick snapshot of some of the points covered.

1.  Foreign property.  Do you own property (land, properties, investments, cash accounts, etc) with a total value of more than $100,000?  If yes, you may be required to file the T1135 form with your tax return.  Some exceptions apply; for example, a property used primarily for personal use.

2. ¬†Income. ¬†If you earn or receive income while outside Canada, you will almost certainly need to declare this as income on your Canadian tax return…….. Canadian residents are taxed on their world income.+

3.  Certain tax credits.  Medical costs in the US, donations to US charities, etc. are discussed in the P151.

4.  US Taxes.  Are you Resident Alien?  A Non-Resident Alien?  The P151 does a good job of introducing the subject, but this is another tax maze where only the brave will enter.  If you are concerned you may be required to file a US tax return, consider talking it over with a US tax professional.


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2012 mileage rates

December 29th, 2011

The 2012 mileage rates are increasing by 1 cent per kilometre.  The new maximum non-taxable rate that an employer can pay is rising to $0.53 / kilometre on the first 5,000 kms per year, and $0.47 for each additional kilometre.

Different rates apply if you live in a northern territory.  Read the full release here: http://www.fin.gc.ca/n11/11-146-eng.asp

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Looking for paper Record of Employment (ROE) forms?  Service Canada has (again) updated the ordering process.  It looks like there is now one telephone number for all of Canada.  As of the date of this posting, that phone number is 1-800-367-5693.


Remember, you can now prepare ROE forms online. ¬†Yes, there is a bit of work involved in getting this set up, but once you’re in the system, it works great! ¬†Read more about that service here:


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Got a letter from the taxman?

November 2nd, 2011

Canada Revenue Agency has, in both 2010 and 2011, sent out mass mailings advising taxpayers that their tax return may be selected for further review. This is part of their Letters Campaign.

You can read more about it here. http://www.cra-arc.gc.ca/tx/bsnss/tpcs/lf-vnts/dt/lttrs/menu-eng.html

They sent out 37,000 letters in 2010 and another 29,000 in 2011. If you receive one of these letters, you don’t want to panic. You received one only because you happened to be in what they call a high-risk area.

The CRA has indicated that they may continue this campaign in future years. Contact us if you wish to discuss this further.

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