For important information on working with a realtor please visit Working With a Real Estate Agent.
Non-residents may move permanently to Canada and may operate a business after obtaining legal status by qualifying for immigration. New Canadian immigration rules have been in effect since June 2002. There are five main categories under which individuals may apply for permanent residence to Canada under a point system. For more information about immigrating to Canada, go to http://www.doakshirreff.com or http://www.ccra-adrc.gc.ca/tax or contact an Immigration office close to you.
Part Timers
Non-residents may stay in Canada for less than 180 consecutive or cumulative days in a calendar year. For this reason, many international buyers have bought second homes in Kelowna and the Okanagan and have adopted a '6 months here and 6 months there' lifestyle.
Tax Consequences
Non-residents who overstay in Canada can be deemed to be Canadian residents
for Canadian income tax purposes and be taxed in Canada on their world income,
even if they have paid taxes in another country.
Non-residents who rent out a property must, by law, remit 25% of their monthly
revenue to Revenue Canada in anticipation of filing a Canadian Income Tax Return
on their rental 'business' by the end of the next tax year. Timely filing of the
required form confirming a net loss on the rental investment may preclude the
requirement for the 25% remittance.
When a non-resident owner sells Canadian property, Canadian law requires a
25% holdback of the proceeds of the sale pending filing of a Canadian Income Tax
return by the end of the next tax year calculating Canadian tax owed on any
Capital Gain. Alternatively, the owner may obtain a 'Clearance Certificate' that
may be applied for in advance of the sale. This Certificate may reduce the
holdback to a percentage of the capital gain instead.
There is a tax treaty in effect between Canada and many countries, including the
U.S., which allows a credit against the tax owed in Canada in the amount of what
tax has been paid in the treaty country on any capital gain. Numerous countries
have signed tax conventions with Canada. For details on how this may affect your
status with regards to income taxation, please consult with your tax accountant.
Caution: Regulations change and exchange rates fluctuate on a regular basis. This information is provided as a guideline only. For details on how any of this information may affect your taxation or legal status, please consult with your tax adviser or nearest immigration center.
2008-05-01 (c) Christine Wolter