Quote:
Originally posted by Timon
I am looking for a tax expert who could advice me on the process of leaving Canada, residency, final tax return, relocation etc. Can someone suggest one?
Thanks
T
Follow these links and read carefully and you will get all the answers.
http://www.cra-arc.gc.ca/tx/nnrsdnts/ndvdls/nnrs-eng.html
http://www.cra-arc.gc.ca/E/pub/tg/t4058/t4058-e.html
http://www.cra-arc.gc.ca/E/pub/tp/it221r3-consolid/it221r3-consolid-e.html
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Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada
Quote:
Originally posted by dimple2001
Quote:
Originally posted by Timon
When do I file my final tax return? For e.g, If I were to leave canada by March 31st of 2011, Do I need to wait till Jan 2012 to file my final tax return? Do companies provide T4's for such a short period? How about my CPP/EI? What would be the impact of my RRSP withdrowals?
Thanks for all the help.
RSP will always be taxed upon withdrawal and possibly penalized for early withdrawal.
I know that RSP withdrawal is taxed. Under what conditions it is penalized for early withdrawal if already paid tax on it? e.g. if I withdraw $30,000 from RSP it is considered as income for that year and I will pay tax on it. Do I have to pay any penalty on top of it?
Posts: 2873
Location: Western Hemisphere
Posted on: 18-11-10 11:27:37
Location: Western Hemisphere
Posted on: 18-11-10 11:27:37
Quote:
Originally posted by web2000
Quote:
Originally posted by dimple2001
Quote:
Originally posted by Timon
When do I file my final tax return? For e.g, If I were to leave canada by March 31st of 2011, Do I need to wait till Jan 2012 to file my final tax return? Do companies provide T4's for such a short period? How about my CPP/EI? What would be the impact of my RRSP withdrowals?
Thanks for all the help.
RSP will always be taxed upon withdrawal and possibly penalized for early withdrawal.
I know that RSP withdrawal is taxed. Under what conditions it is penalized for early withdrawal if already paid tax on it? e.g. if I withdraw $30,000 from RSP it is considered as income for that year and I will pay tax on it. Do I have to pay any penalty on top of it?
I guess I should have clarified the penalty. The penalty for early withdrawal comes in the form of lost contribution. I myself have difficulty understanding, but here is an excerpt from googling....
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"And, unfortunately, the withholding tax is not the only penalty your withdrawal will incur.
If you're still thinking about taking money out of an RRSP early, consider this: once you've taken money out of an RRSP through an early withdrawal, you'll never be able to recontribute that amount. For example, let's say that your lifetime contributions to your RRSP total $15,000. Because you have not always made the maximum allowable contribution, you have also accumulated $30,000 in additional contribution room. If you withdraw the $15,000, however, you are now left with only $15,000 worth of room to contribute. In other words, if you take money out of an RRSP before retirement and use it for something other than education costs or the purchase of a home, you will lose an equal amount of contribution room. "
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Dimple2001
Quote:
Originally posted by dimple2001
Quote:
Originally posted by web2000
Quote:
Originally posted by dimple2001
Quote:
Originally posted by Timon
When do I file my final tax return? For e.g, If I were to leave canada by March 31st of 2011, Do I need to wait till Jan 2012 to file my final tax return? Do companies provide T4's for such a short period? How about my CPP/EI? What would be the impact of my RRSP withdrowals?
Thanks for all the help.
RSP will always be taxed upon withdrawal and possibly penalized for early withdrawal.
I know that RSP withdrawal is taxed. Under what conditions it is penalized for early withdrawal if already paid tax on it? e.g. if I withdraw $30,000 from RSP it is considered as income for that year and I will pay tax on it. Do I have to pay any penalty on top of it?
I guess I should have clarified the penalty. The penalty for early withdrawal comes in the form of lost contribution. I myself have difficulty understanding, but here is an excerpt from googling....
----------------------------------
"And, unfortunately, the withholding tax is not the only penalty your withdrawal will incur.
If you're still thinking about taking money out of an RRSP early, consider this: once you've taken money out of an RRSP through an early withdrawal, you'll never be able to recontribute that amount. For example, let's say that your lifetime contributions to your RRSP total $15,000. Because you have not always made the maximum allowable contribution, you have also accumulated $30,000 in additional contribution room. If you withdraw the $15,000, however, you are now left with only $15,000 worth of room to contribute. In other words, if you take money out of an RRSP before retirement and use it for something other than education costs or the purchase of a home, you will lose an equal amount of contribution room. "
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Thanks to clarify.
I am not too concerned about the RRSP room since I maynot come back to Canada to live permanently. My issue was related to the withholding tax and the impact of net taxation for the year in which I am departing. Also I was wondering whether there is any use in spreading my RRSP withdrowals over two years or leave it to next year where my income will be close to nil
Thanks
T
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"The grass is not, in fact, always greener on the other side of the fence. Fences have nothing to do with it. The grass is greenest where it is watered. When crossing over fences, carry water with you and tend the grass wherever you may be"
Posts: 5775
Location: God's own country
Posted on: 18-11-10 12:56:43
Location: God's own country
Posted on: 18-11-10 12:56:43
Quote:
Originally posted by Timon I am not too concerned about the RRSP room since I maynot come back to Canada to live permanently. My issue was related to the withholding tax and the impact of net taxation for the year in which I am departing. Also I was wondering whether there is any use in spreading my RRSP withdrowals over two years or leave it to next year where my income will be close to nil
Thanks
T
Every day you can withdraw $ 5000 or less from your RRSP and your withholding tax would be just 10 % of the amount meaning that you will get your $4500. If you withdraw more than $ 5000 in a single day then the withholding rate is 20%. This withholding tax will be adjusted in your income tax return of that year and the excess amount will be refunded to you. Try to withdraw after Jan 01/2011 (assuming that you will leave the country in March 2011) and your tax implication for RRSP will be nil.
Note that you will have to intimate to the CRA when you will be leaving the country and try to do all the disposing before the day of departure or you may come under their scanner.
You can give your indian address to the CRA and all communication will be sent to India incl. refund (if any).
If you have to sell a house, then there will be more tax implication/complication that I am not aware.
As I said before, once you leave canada with no dependants here, you will actually receive nada ($ 0) hence forth from the govt.. meaning that the Govt. of Canada will not be giving any handouts / benefits for you to settle in India (like CCTB, UCCB, HST credits, Welfare cheques, Food bank vouchers, one time settlement allowance to settle in India etc..) The only benefit is that you will be allowed to keep your Canadian passport in India and use it whenever you want to come to Canada.
All the best in reality.
PEace
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I am a Gents and not a Ladies.
Quote:
Originally posted by tamilkuravan
Quote:
Originally posted by Timon I am not too concerned about the RRSP room since I maynot come back to Canada to live permanently. My issue was related to the withholding tax and the impact of net taxation for the year in which I am departing. Also I was wondering whether there is any use in spreading my RRSP withdrowals over two years or leave it to next year where my income will be close to nil
Thanks
T
Every day you can withdraw $ 5000 or less from your RRSP and your withholding tax would be just 10 % of the amount meaning that you will get your $4500. If you withdraw more than $ 5000 in a single day then the withholding rate is 20%. This withholding tax will be adjusted in your income tax return of that year and the excess amount will be refunded to you. Try to withdraw after Jan 01/2011 (assuming that you will leave the country in March 2011) and your tax implication for RRSP will be nil.
Note that you will have to intimate to the CRA when you will be leaving the country and try to do all the disposing before the day of departure or you may come under their scanner.
You can give your indian address to the CRA and all communication will be sent to India incl. refund (if any).
If you have to sell a house, then there will be more tax implication/complication that I am not aware.
As I said before, once you leave canada with no dependants here, you will actually receive nada ($ 0) hence forth from the govt.. meaning that the Govt. of Canada will not be giving any handouts / benefits for you to settle in India (like CCTB, UCCB, HST credits, Welfare cheques, Food bank vouchers, one time settlement allowance to settle in India etc..) The only benefit is that you will be allowed to keep your Canadian passport in India and use it whenever you want to come to Canada.
All the best in reality.
PEace
correct.
