Canada has a unique taxation system that is not anchored on citizenship. Rather, your obligations are pegged on worldwide income. Your decision to move into Canada should also including considerations on minimizing your tax burden to the bare minimum. Here are tax issues for investors and Canadian immigrants to consider according to experts.
The thought of getting better income in Canada lures many people into the country. Many are disappointed when they realize that this is not the case. They opt to leave spouses and families behind to work abroad. This does not minimize your obligations and may even increase the fraction demanded both locally and abroad. The status your family or spouse is left determines your obligations.
Taking up tax residence exposes you to greater obligations that might be difficult or strenuous to meet. You will have to declare all the income you earn regardless of your country of residence. Many people will hide what is earned away from Canada. You will still be exposed because revenue authorities allover the world are sharing information widely. You will therefore be traced which places you in a compromising situation. This might jeopardize your permanent residency.
It is illegal to fail to declare income obtained while abroad if you are considered a resident. With stringent rules governing immigration and acquisition of permanent residence, you risk losing that status. Many people have in fact lost this status on the basis of undeclared income. The revenue authority further commences audit issues that will result into criminal proceedings. This can be avoided by understanding the issues affecting your unique status.
The best point to start is to establish your tax residence status. Since this comes with immense responsibilities, you can legally escape them by retaining minimum links with Canada. Find the most favorable taxation regime and align your obligations to it. You might be worried that such arrangements will affect your permanent status? This is not the case. The two issues are handled differently meaning that none will affect the other.
The fact that residency and taxation are mutually exclusive issues means that you can take one and not the other. However, you will still need to minimize your exposure to taxation. The solution is to register an Immigration Trust. This guarantees a taxation holiday running for five years. Your obligations and benefits with the trust will be determined by the interaction between the laws governing the two countries.
Is it necessary to chase residency? This question is best answered by looking at the clause that grants special status to a person working for a Canadian company or one who spends 730 days in five years touring with a Canadian citizen or living in Canada. These are two ways to hack into permanent residency.
The introduction of the super visa and the multiple entry visa made it easy for spouses and families of immigrants or Canadian citizens to visit easily and reside in Canada for up to two straight years. This enables a person to have a family and easily visit them and still explore the option of settling there after making money elsewhere. This makes it easy to navigate taxation laws without losing permanent residency for you or your family.
When you are searching for information about tax issues for investors and Canadian immigrants, pay a visit to our web pages online here today. More details are available at http://www.taxca.com now.