Frequently Asked Questions (FAQs)

Question 1- Do I need to file a U.S. tax return if I’m a U.S. citizen living abroad? 

Answer 1- Yes. U.S. citizens must file a federal tax return each year, even if they live abroad, because the U.S. taxes based on citizenship rather than residency. Many individuals do not end up owing U.S. tax once tools like the Foreign Earned Income Exclusion or Foreign Tax Credit are applied. Your actual filing position depends on income type, tax paid abroad, and whether you meet specific residency tests, so it’s best to review your situation directly. 

Question 2- Do I need to file a Canadian tax return if I’m a non-resident? 

Answer 2- Non-residents may need to file if they earn Canadian-source income, such as employment earnings, self-employment income, rental income, or certain investment types. Filing is often required to ensure proper withholding tax has been applied and to potentially recover overpayments. The filing rules can vary depending on the nature of your income and your residency status. A short consultation is usually enough to confirm your exact obligations. 

Question 3- What is the Foreign Earned Income Exclusion (FEIE)? 

Answer 3- The FEIE allows eligible U.S. taxpayers working abroad to exclude a portion of their foreign employment income from U.S. taxation. The exclusion amount adjusts annually and is available only if you meet specific residency or physical presence requirements. While it can significantly reduce U.S. tax, it doesn’t apply to all income types. Choosing between the FEIE and other tools like the Foreign Tax Credit requires a tailored assessment. 

Question 4- What is the Foreign Tax Credit (FTC)? 

Answer 4- The FTC provides relief by allowing U.S. taxpayers to claim a credit for foreign taxes paid on the same income. This is commonly used by U.S. citizens living in Canada, where Canadian tax rates often offset U.S. tax liability. The mechanics can become complex when multiple income types or tax treaties apply. A review of your overall tax picture helps determine the most efficient approach. 

Question 5- Do I need to report foreign bank accounts to the U.S. (FBAR)? 

Answer 5- You must file an FBAR if the combined value of your foreign financial accounts exceeds USD $10,000 at any point in the year. This requirement applies even if the accounts generate little or no income. Penalties for non-compliance can be significant, so timely reporting is important. Most individuals find this straightforward once their accounts are reviewed and organized. 

Question 6- What if I am not a U.S. citizen. Do I still need to file a U.S. tax return?

Answer 6- Non-U.S. citizens generally only need to file a U.S. tax return if they earn U.S.-source income or meet the substantial presence test. Common examples include U.S. employment income, rental properties, business activities, or certain types of investment income. The rules can be strict, and filing may be required even if no tax is ultimately owed. A quick review of your specific income and days spent in the U.S. is usually enough to determine your filing status. 

Question 7- How does the IRS determine whether I am a U.S. tax resident?

Answer 7- The IRS generally uses the substantial presence test to determine U.S. tax residency, which looks at the number of days you spend in the United States over a three-year period. If your calculated days exceed the threshold, you may be treated as a U.S. resident for tax purposes and required to report worldwide income. Certain exemptions are available for students, diplomats, commuters, and individuals with a closer connection to another country. Reviewing your travel history and ties to other jurisdictions helps confirm your residency status. 

Question 8- What is the difference between Form 1040 and 1040-NR? 

Answer 8- Form 1040 is used by U.S. citizens and U.S. tax residents to report their worldwide income, while Form 1040-NR is for non-resident individuals who only need to report U.S.-source income. The forms differ in available credits, deductions, and how certain types of income are taxed. Non-residents generally face different tax rates and fewer deductions compared to residents. Choosing the correct form depends on your residency status under IRS rules, which should be reviewed carefully. 

Question 9- Do I need to report my foreign bank accounts to the IRS? 

Answer 9- Yes. You must report your foreign financial accounts if the total value of all accounts exceeds USD $10,000 at any point during the year. This is done through the FBAR, and in some cases Form 8938, depending on your income level and filing status. The rules are strict, and penalties for missed filings can be significant, so it’s important to review your accounts each year to confirm whether reporting is required.

Question 10- What is FATCA Form 8938, and how is it different from the FBAR? 

Answer 10- Form 8938 is a tax form filed with your U.S. return to report foreign financial assets under FATCA, while the FBAR is a separate Treasury filing used to report foreign bank and financial accounts. The thresholds for Form 8938 are generally higher and depend on your residency and filing status, whereas the FBAR applies once your combined foreign accounts exceed USD $10,000. Although both forms address offshore reporting, they serve different purposes and often require different details. It’s important to determine whether one or both apply to your situation each year. 

Question 11- Do I need to report foreign mutual funds or investments? 

Answer 11- Yes. Most foreign investments: including mutual funds, ETFs, and certain corporations, must be reported to the IRS and may fall under complex rules such as PFIC (Passive Foreign Investment Company) reporting. These investments often require additional forms and can result in different tax treatment than U.S.-based funds. Because reporting thresholds and tax implications vary, it’s important to review your investment holdings each year to determine the correct filings. 

Question 12- What if I have missed filings for previous years?

Answer 12- If you’ve missed U.S. tax filings or foreign account reports, the IRS offers programs that allow you to catch up while minimizing penalties, such as the Streamlined Filing Compliance Procedures. These options are designed for taxpayers who were non-wilful in their non-compliance and need to get back on track. The specific steps and disclosures required depend on how many years were missed and the type of filings involved. A short assessment is usually enough to determine which program applies and how to correct your situation efficiently. 

Question 13- I live in Canada. do I still need to file a U.S. tax return? 

Answer 13- Yes. U.S. citizens and U.S. tax residents must file a U.S. tax return each year even if they live in Canada, because the U.S. taxes based on citizenship rather than where you reside. Most Canadians with U.S. filing obligations don’t end up owing U.S. tax once the Foreign Tax Credit or other treaty provisions are applied. Your exact requirements depend on your income sources, residency status, and how much Canadian tax you pay, so it’s best to review your situation directly. 

Question 14- How does the Canada–U.S. tax treaty benefit me?

Answer 14- The Canada–U.S. tax treaty helps prevent double taxation by outlining which country has the primary right to tax different types of income. It also provides mechanisms such as foreign tax credits and tie-breaker rules to determine residency when both countries claim you as a tax resident. The treaty can reduce or eliminate certain U.S. taxes for Canadian residents, especially on pensions, employment income, and investments. How the treaty applies depends on your specific facts, so reviewing your income streams and residency position is essential. 

Question 15- Do I need to file a Canadian tax return if I’m a U.S. resident earning income from Canada? 

Answer 15- You may need to file a Canadian tax return if you earn certain types of Canadian-source income, such as employment income, business income, or rental income. Some income is taxed through withholding at the source, but in many cases filing a return allows you to confirm the correct tax was applied or recover any excess. The filing requirements depend heavily on the type of income and whether you have a permanent establishment in Canada. A quick review of your situation usually clarifies whether a return is required and how to minimize double taxation. 

Question 16- How are U.S. stock options, RSUs, and ESPPs taxed when I move between the U.S. and Canada?

Answer 16- Equity compensation such as stock options, RSUs, and ESPPs is generally taxed based on where you earned the related employment income, which means taxation can be split between the U.S. and Canada if you moved during the vesting or service period. Both countries may claim tax on the same benefit, but the Canada–U.S. tax treaty and foreign tax credits help reduce double taxation. Each plan type has different timing rules for when income is recognized, and cross-border moves make the calculations more technical. Reviewing your grant dates, vesting periods, and move dates is usually enough to determine the correct tax reporting in both countries. 

Question 17- Do I report my TFSA or RESP on my U.S. tax return? 

Answer 17- Yes. TFSAs and RESPs are not treated as tax-free plans for U.S. purposes, so the income inside these accounts is generally taxable to U.S. citizens and U.S. residents each year. In some cases, these accounts may also be considered foreign trusts, which can trigger additional reporting forms. The actual requirements depend on the type of investments and how the account is structured, so it’s important to review these accounts carefully to determine the right U.S. filings.

Question 18- How is CPP or OAS taxed in the U.S.? 

Answer 18- Under the Canada–U.S. tax treaty, Canada Pension Plan (CPP) and Old Age Security (OAS) benefits are treated as U.S. Social Security for tax purposes. This means the United States has the exclusive right to tax them, and depending on your income level, up to 85% of the benefit may be taxable on your U.S. return. Canada does not withhold tax on these payments for U.S. residents, so no foreign tax credit is available. Your actual taxable amount depends on your total income, so reviewing your full filing position is important. 

Question 19- What happens to my Canadian residency when I move to the U.S.? 

Answer 19- Your Canadian tax residency ends once you sever significant residential ties such as your home, spouse or dependents in Canada, and establish a permanent home in the U.S. When you leave, Canada generally considers you a non-resident for tax purposes and may require a departure return, which can trigger tax on certain assets. Some secondary ties—like bank accounts or memberships—don’t prevent you from becoming a non-resident, but the CRA reviews all facts together. Because residency is fact-specific, it’s important to assess your ties carefully to confirm the exact date you become a non-resident. 

Question 20- If I leave Canada mid-year, do I file a special return? 

Answer 20- Yes. When you leave Canada partway through the year, you file a departure return, which reports your income up to the date you became a non-resident. This return may also require reporting certain assets for departure tax purposes, depending on your holdings. Your residency date drives the filing requirements, so it’s best to review your ties and move date carefully to ensure the return is completed correctly.

Question 21- How does Canada determine tax residency? 

Answer 21- Canada determines tax residency based on your residential ties, such as a home, spouse or dependants, and the general permanence of your presence in the country. Secondary ties like bank accounts, driver's licenses, or memberships also factor into the analysis but carry less weight. If your overall ties suggest that Canada remains your primary place of residence, the CRA will generally consider you a resident for tax purposes. Because the test is based on all facts and circumstances, reviewing your ties carefully is the best way to confirm your residency status. 

Question 22- If I am a non-resident of Canada, what income is taxable? 

Answer 22- As a non-resident, you are generally taxed only on Canadian-source income, such as employment earnings, business income carried on in Canada, rental income, and certain types of investment income. Some income is subject to withholding tax at source, while other types require you to file a Canadian non-resident return to report the income properly. The withholding rules and filing requirements depend on the nature of the income and any treaty protections that may apply. Reviewing your income streams is the best way to confirm what needs to be reported and how to minimize double taxation. 

Question 23- How are capital gains taxed in Canada?

Answer 23- In Canada, 50% of a capital gain is taxable, meaning only half of the gain is included in your income for tax purposes. The federal government had proposed increasing the inclusion rate starting in 2024, but the change was ultimately deferred and never implemented, so the 50% rule remains in place. The actual tax you pay depends on your marginal rate and whether any exemptions apply, such as the principal residence exemption. Reviewing the nature of the asset and your residency status helps determine the correct reporting and tax impact. 

Question 24- Do I need to report foreign assets to the CRA?

Answer 24- Yes. If you are a Canadian tax resident and the total cost of your foreign property exceeds CAD $100,000, you must file Form T1135 to report those assets. This includes items such as foreign bank accounts, investments, rental properties, and certain shares held outside Canada. The form is strictly informational, but penalties for late or missed filings are significant, so it’s important to review your holdings each year to confirm whether reporting is required. 

Question 25- What happens if I sell a rental property in Canada after moving abroad? 

Answer 25- If you sell a Canadian rental property as a non-resident, the buyer is generally required to withhold 25% of the gross sale price and remit it to the CRA. You can reduce this withholding by filing Form T2062, which allows the CRA to base the tax on your estimated gain instead of the full sale amount. After the sale, you must file a Canadian non-resident return to report the actual capital gain and recover any excess withholding. Because the process is time-sensitive and document-heavy, reviewing the transaction in advance helps avoid delays and unnecessary tax. 

Question 26- What documents do you need to prepare my return? 

Answer 26- The documents we need depend on whether we’re preparing a Canadian, U.S., or cross-border return, but generally include income slips, investment statements, foreign income details, and any tax slips from employers or financial institutions. For cross-border clients, we also review residency information, foreign account summaries, and any equity compensation or rental property records. Copies of prior-year returns are helpful to ensure consistency and catch carryforwards. A short intake call or checklist usually clarifies exactly what applies to your situation. 

Question 27- Do you work with clients outside the U.S. and Canada? 

Answer 27- Yes. We regularly assist clients living in other countries who have U.S. or Canadian tax filing obligations, such as citizens abroad, cross-border investors, or individuals with rental properties or financial ties in either country. Most work can be completed remotely through secure digital tools, making it easy to support clients regardless of location. If you’re unsure whether your situation qualifies, a brief consultation is usually enough to determine how we can help.

Question 28- What is the typical turnaround time?

Answer 28- Turnaround time depends on the complexity of your return and how quickly we receive all required documents, but most engagements are completed within two to four weeks. Cross-border files or returns with multiple countries, investments, or equity compensation may take a bit longer. We always provide an estimated timeline once your documents are reviewed so you know what to expect. If you have a deadline or pending filing requirement, we can usually accommodate it with advance notice. 

Question 29- How are fees structured? 

Answer 29- We work on a fixed-fee basis so you know the cost upfront before any work begins. Once we review your documents and understand the scope of your filing, we provide a clear fee quote with no surprises. Cross-border or more complex situations may require additional review, but the fee is always confirmed in advance. This approach ensures transparency and helps you plan without uncertainty. 

Question 30- Do I need to file both a U.S. and Canadian tax return in the same year?

Answer 30- Yes. Many individuals moving between the U.S. and Canada must file in both countries for the year of the move, depending on residency status and income sources. Each country taxes differently, and the Canada–U.S. tax treaty helps prevent double taxation through foreign tax credits. Reviewing your income flows and move dates is the best way to confirm exactly what’s required.

Question 31- How do foreign tax credits work between the U.S. and Canada? 

Answer 31- Foreign tax credits allow you to claim tax paid in one country to offset tax owed in the other, reducing or eliminating double taxation. The rules differ between the IRS and CRA, especially regarding timing and carryforward rules. Proper coordination is key, as claiming a credit incorrectly can lead to unnecessary tax or missed benefits. Reviewing both returns together ensures the credits are applied efficiently. 

Question 32- What happens if my residency status changes mid-year? 

Answer 32- A mid-year residency change often means you file a return in each country, reporting income based on where you lived during the year. Canada requires a departure return, while the U.S. may require full-year or part-year reporting depending on residency tests. The treaty may also apply if both countries consider you a resident. Determining the exact residency date is essential for accurate filing. 

Question 33- Do I pay tax twice if I work in one country and live in the other? 

Answer 33- No, not typically. While both countries may claim the same income, tax treaties and foreign tax credits ensure you don’t pay tax twice. The country where you physically perform the work generally has the first taxing right. Coordinating filings prevents double taxation and ensures proper credit claims. 

Question 34- How do tax treaties affect my return? 

Answer 34- Tax treaties allocate taxing rights between countries and help prevent double taxation on income such as employment, pensions, and investments. They can override domestic tax rules in certain cases, especially when determining residency or avoiding withholding tax. Applying treaty articles properly can significantly reduce your tax burden. Each situation is fact-specific, so reviewing income by type helps confirm your treaty position. 

Question 35- What happens if I receive income in both countries? 

Answer 35- You report the income to each country based on your residency status and where the income was earned. Foreign tax credits help reduce overlap where both countries tax the same income. Different reporting rules apply to investments, rentals, and self-employment, which can affect the final result. Reviewing each income type ensures proper treatment. 

Question 36- How are foreign pensions and retirement plans taxed? 

Answer 36- Foreign pensions are often taxable in both countries, but tax treaties determine which country has primary taxing rights. Some plans receive favourable treatment, while others may trigger annual reporting. The timing of withdrawals and local tax paid can affect credits and your overall tax position. Reviewing each plan individually is the best approach. 

Question 37- What if my employer is in another country but I work remotely? 

Answer 37- Taxation depends on where you physically perform the work, not where your employer is located. If you work from Canada for a U.S. employer (or vice versa), you may still create tax obligations in your country of residence. Some situations can also trigger payroll or withholding complications. A quick review usually clarifies what needs to be filed. 

Question 38- How are cryptocurrency or digital assets taxed when held abroad? 

Answer 38- Cryptocurrency is taxed similarly to other investments, meaning gains are generally taxable in your country of residence. If the assets are held on foreign exchanges, additional reporting may apply, such as Form T1135 or U.S. foreign asset disclosures. Each country treats staking, mining, and trading differently. Tracking transactions carefully helps ensure proper reporting. 

Question 39- What should I consider before moving to the U.S. or returning to Canada? 

Answer 39- A move across the border impacts residency, tax filing requirements, and how your investments and retirement plans are taxed. Pre-departure planning can reduce exit tax exposure in Canada and ensure proper U.S. onboarding for tax and immigration purposes. Reviewing equity compensation, rental properties, and investments ahead of time is often beneficial. A pre-move consultation helps avoid surprises. 

Question 40- Do you file extensions for U.S. or Canadian returns? 

Answer 40- Yes. We can file extensions for U.S. and Canadian returns when needed, as long as the request is made before the deadline. An extension gives you more time to file, but not more time to pay, so estimated payments may still be required. We help you determine whether an extension makes sense based on your situation. 

Question 41- Can you work directly with the CRA or IRS on my behalf?  

Answer 41- Yes. With your authorization, we can communicate directly with the CRA or IRS to address notices, resolve issues, or obtain account information. This often speeds up the process and reduces stress for clients. We regularly assist with audits, reviews, and account matters for both countries. 

Question 42- Do you assist with audit support or tax notices? 

Answer 42- Absolutely. We review the notice, determine the issue, and respond directly to the CRA or IRS on your behalf once authorized. Many notices are routine and easily resolved with the right documentation. Prompt review prevents penalties and ensures the agencies receive accurate information. 

Question 43- How do I send you my documents securely? 

Answer 43- We provide a secure client portal where you can upload documents safely and efficiently. The portal encrypts your information and keeps everything organized in one place. If needed, we can also accept documents through other secure methods. We’ll guide you through the process to make it straightforward. 

Question 44- How do virtual meetings or remote engagements work? 

Answer 44- Most of our work is completed remotely, allowing us to assist clients across Canada, the U.S., and internationally. Meetings are held by video or phone, and all documents are exchanged securely through our portal. This approach keeps the process efficient and flexible. We tailor communication to your preferences so everything runs smoothly.  

Question 45- Hi, how are you? I’m a non-resident now, do I still need to file a Canadian tax return? 

Answer 45- Great question. In many cases, yes. Even if tax was withheld at source, non-residents may still benefit from filing a Canadian tax return under specific provisions like Section 216 or Section 217. Whether filing is required or advantageous depends on the type of Canadian income you receive.

👉 Read more: Section 216 vs Section 217 – Which return applies to you?

Question 46- Hi there.....what’s the difference between a Section 216 and a Section 217 return? 

Answer 46- Section 216 generally applies to rental income earned from Canadian real estate by non-residents, while Section 217 applies to certain pension and retirement income such as CPP, OAS, or RRIF withdrawals. Each election applies to different income and is filed separately.

👉 Learn more about how these two returns work and when to file each one.

Question 47- Hello, I already had tax withheld on my Canadian rental income. Is that tax final? 

Answer 47- Not always. While non-resident withholding is often treated as final, filing a Section 216 return may allow you to report net rental income after expenses. In many cases, this results in a lower tax bill and a potential refund. 

👉See when filing a Section 216 return can reduce your tax.

Question 48- Hi, I receive CPP and RRIF income from Canada but live abroad. Am I overpaying tax?

Answer 48- Possibly. Non-resident withholding on pension and retirement income can exceed the tax payable under resident tax rates. Filing a Section 217 return may allow you to use personal credits and graduated rates, potentially resulting in a refund. 

👉Find out whether a Section 217 election makes sense for you.

Question 49- Hi, can I file more than one non-resident tax return in the same year?

Answer 49- Yes. If you have different types of qualifying income—such as rental income and pension income—you may be able to file both a Section 216 return and a Section 217 return in the same year. Each return applies only to the specific income it covers. 

👉Learn how multiple non-resident returns can apply in one tax year.

Question 50- Hello, what happens if I don’t file a Section 216 or 217 return at all? 

Answer 50- If no election is filed, the tax withheld at source is generally treated as final. This can mean paying more tax than necessary and losing the ability to claim a refund. Missing filing deadlines may permanently eliminate refund opportunities. 

👉Read about common non-resident tax mistakes and how to avoid them.

Question 51- Hi, does the Canada–U.S. tax treaty mean I don’t need to file anything in Canada? 

Answer 51- Not necessarily. While tax treaties can reduce withholding rates, they do not automatically eliminate the benefit of filing a Canadian return. In many cases, filing under Section 216 or 217 can still reduce overall Canadian tax. 

👉See how tax treaties interact with non-resident filings.

Question 52- Hi there- should I speak with a tax professional before filing as a non-resident? 

Answer 52- Yes. Non-resident filings involve strict deadlines, elections, and coordination with foreign tax returns. A professional review can help determine whether filing is beneficial and ensure everything is done correctly. 

👉Learn when professional advice can save tax and prevent issues.

Question 53- Hi, hope you’re well. What is Canadian departure tax and should I be worried about it? 

Answer 53- Canadian departure tax can apply when you leave Canada and become a non-resident. In some cases, Canada treats certain assets as if they were sold, which may trigger tax even though no sale occurred. Whether it applies depends on your residency status and the assets you own.

👉 Learn more: What Is Canadian Departure Tax and Who Has to Pay It?

Question 54- Hello, I’m planning to move abroad. When does Canada consider me a non-resident for tax purposes? 

Answer 54- Canada determines residency based on your residential ties, not citizenship. Factors such as your home, family, employment, and personal ties all matter. Becoming a non-resident can trigger departure tax, so timing and planning are important. 

👉 Read about how residency affects departure tax

Question 55- Hi there- does departure tax apply only to Canadian assets? 

Answer 55- No. Departure tax can apply to certain worldwide assets, including foreign investments and private company shares. Canadian real estate and registered plans are generally excluded, but they have their own tax rules later on. 

👉 See which assets are subject to Canadian departure tax.

Question 56- Hello, I’m moving to the U.S. Does the tax treaty protect me from departure tax?

Answer 56- Not automatically. The Canada–U.S. tax treaty can help prevent double taxation in the future, but it does not eliminate Canada’s ability to impose departure tax when you leave. Planning is still required. 

👉 Learn how treaties interact with departure tax.

Question 57- Hi, when do I have to report departure tax to the CRA?

Answer 57- Departure tax is reported on your final Canadian tax return for the year you become a non-resident. Additional disclosure forms may also be required. Missing these filings can create problems later.  

👉 Read about departure tax filing requirements.

Question 58- Hello- can I defer Canadian departure tax instead of paying it right away? 

Answer 58- In many cases, yes. The CRA may allow you to defer payment until the asset is actually sold, subject to elections and possible security. Deferral helps with cash flow but does not eliminate the tax. 

👉 Find out when departure tax can be deferred.

Question 59- Hi there...are RRSPs and TFSAs subject to departure tax when I leave Canada? 

Answer 59- No. Registered plans like RRSPs, RRIFs, and TFSAs are generally excluded from departure tax. However, withdrawals after you become a non-resident are usually subject to non-resident withholding tax. 

👉 Learn how registered plans are treated after leaving Canada.

Question 60- Hello, what happens if I don’t deal with departure tax properly?

Answer 60- Failing to report departure tax or disclose assets can lead to penalties, interest, and complications when assets are sold later. These issues are often difficult to fix after the fact. 

👉 Read about common departure tax mistakes.

Question 60- Hello, what happens if I don’t deal with departure tax properly?

Answer 60- Failing to report departure tax or disclose assets can lead to penalties, interest, and complications when assets are sold later. These issues are often difficult to fix after the fact. 

👉 Read about common departure tax mistakes.

Question 61- Hi, hope you’re doing well. What happens to my RRSP if I leave Canada? 

Answer 61- Leaving Canada does not automatically affect your RRSP. In most cases, you can keep the account open after becoming a non-resident, but withdrawals and future tax treatment change. Planning ahead is important to avoid unexpected withholding tax. 

👉 Read more: What Happens to Your RRSP When You Leave Canada?

Question 62- Hello, do I have to close my RRSP when I move abroad? 

Answer 62- No. You are not required to close your RRSP when you leave Canada. Many non-residents keep their RRSPs in place and continue to hold investments inside the account.  

👉 Learn how RRSPs are treated after leaving Canada.

Question 63- Hi there...does Canada tax my RRSP when I become a non-resident? 

Answer 63- No. RRSPs are not subject to Canadian departure tax. However, withdrawals made after you become a non-resident are usually subject to non-resident withholding tax. 

👉 See how RRSPs are taxed after emigration.

Question 64- Hello, can I keep contributing to my RRSP after leaving Canada? 

Answer 64- Generally, no. Once you become a non-resident, you typically cannot make new RRSP contributions, even if you still have unused contribution room. 

👉 Find out why RRSP contributions usually stop after departure.

Question 65- Hi, how much tax is withheld if I withdraw my RRSP as a non-resident?

Answer 65-The standard non-resident withholding rate on RRSP withdrawals is 25%. This rate may be reduced under an applicable tax treaty, such as the Canada–U.S. tax treaty. 

👉 Learn how RRSP withholding tax works for non-residents.

Question 66- Hello, is RRSP withholding tax final, or do I have to file a Canadian tax return?

Answer 66-In most cases, the withholding tax on RRSP withdrawals is considered final Canadian tax, and no Canadian tax return is required. The income may still need to be reported in your country of residence. 

👉 Read more about RRSP reporting after leaving Canada.

Question 67- Hi there- should I withdraw my RRSP before leaving Canada or wait?

Answer 67-There is no single correct answer. The decision depends on your income level, future country of residence, treaty protection, and retirement plans. Timing withdrawals incorrectly can lead to higher overall tax. 

👉 See when withdrawing an RRSP before departure makes sense.

Question 68- Hello, how are RRSPs treated in the U.S. or other countries? 

Answer 68-Treatment depends on the tax rules of your new country and any applicable tax treaty. Some countries recognize RRSPs as tax-deferred plans, while others may tax income differently. 

👉 Learn how foreign tax rules affect RRSPs.

Question 68- Hello, how are RRSPs treated in the U.S. or other countries? 

Answer 68-Treatment depends on the tax rules of your new country and any applicable tax treaty. Some countries recognize RRSPs as tax-deferred plans, while others may tax income differently. 

👉 Learn how foreign tax rules affect RRSPs.

Question 69- Hi, hope you’re doing well. Is Canadian non-resident withholding tax always final? 

Answer 69-Not always. In some cases, withholding tax is final, but in others it acts as a prepayment and can be recalculated by filing a Canadian return or election. The outcome depends on the type of income you receive. 

👉 Read more: Non-Resident Withholding Tax in Canada: What’s Final and What Isn’t

Question 70- Hello, I had tax withheld on my Canadian income—does that mean I’m done with CRA? 

Answer 70-Not necessarily. While some withholding is considered final, other types of income allow non-residents to file a return to reduce tax or claim a refund. It’s important to review the nature of the income before assuming compliance is complete. 

👉 Learn when withholding tax is final and when it isn’t.

Question 71- Hi there- what types of Canadian income are subject to non-resident withholding tax?  

Answer 71-Non-resident withholding commonly applies to rental income, pensions, RRSP or RRIF withdrawals, dividends, and certain other passive income. The rules vary depending on the income type and whether elections are available. 

👉 See which types of income are covered by withholding tax.

Question 72- Hello, I earn rental income from Canada. Is the 25% withholding really my final tax? 

Answer 72- Often, no. Non-residents earning Canadian rental income can usually file a Section 216 return to be taxed on net income rather than gross rent. This frequently results in a lower tax bill and a refund. 

👉 Read how rental income withholding can be reduced.

Question 73- Hi, I receive CPP or RRIF income from Canada. Can I get some of the tax back?

Answer 73- Possibly. Certain pension and retirement income may qualify for a Section 217 election, which allows graduated tax rates and personal credits. This can reduce tax compared to flat withholding. 

👉 Learn when a Section 217 return may apply.

Question 74- Hello, does a tax treaty mean withholding tax is always correct? 

Answer 74- No. While tax treaties can reduce withholding rates, treaty-reduced withholding may still be higher than the tax payable under a net or graduated-rate calculation. Filing may still be beneficial. 

👉 See how tax treaties interact with withholding tax.

Question 75- Hi there- do I need to file a Canadian tax return as a non-resident?  

Answer 75- It depends. In some cases, withholding tax is final and no return is required. In others, filing a return or election is necessary to calculate the correct tax or claim a refund. 

👉 Read when non-residents should file Canadian returns.

Question 76- Hello, what happens if I don’t review my withholding tax situation?   

Answer 76- Failing to review withholding can lead to years of overpaid tax or missed refund opportunities. In some cases, missing filing deadlines can permanently eliminate the ability to recover excess tax. 

👉 Learn about common non-resident withholding mistakes.

Question 77- Hi, hope you’re doing well. Do non-residents have to pay tax when selling Canadian property?  

Answer 77- Yes. Canada taxes non-residents on capital gains from Canadian real estate, even if the seller lives abroad. Special reporting and withholding rules apply at the time of sale. 

👉 Read more: Selling Canadian Real Estate as a Non-Resident: Tax Rules Explained

Question 78- Hello, I’m selling my Canadian home from abroad. Why is so much tax being withheld at closing? 

Answer 78- When a non-resident sells Canadian property, the buyer is generally required to withhold a portion of the sale price unless a Certificate of Compliance is obtained. This withholding is meant to secure the CRA’s tax claim. 

👉 Learn how withholding works for non-resident property sales.

Question 79- Hi there...what is a Certificate of Compliance and why do I need one? 

Answer 79- A Certificate of Compliance confirms that the CRA has been notified of the sale and that estimated Canadian tax has been paid or secured. Without it, the buyer must withhold a large portion of the sale proceeds. 

👉 See how a Certificate of Compliance can reduce withholding.

Question 80- Hello, do I still need to file a Canadian tax return after selling my property?

Answer 80- Yes. Non-residents must usually file a Canadian tax return to report the sale and calculate the actual capital gains tax. Any tax withheld at closing is credited on that return.

👉 Read about post-sale filing obligations for non-residents.

Question 81- Hi, does the Canada–U.S. tax treaty exempt me from Canadian tax on my property sale? 

Answer 81- No. While tax treaties help prevent double taxation, they generally do not remove Canada’s right to tax gains on Canadian real estate. Planning is still required. 

👉 Learn how tax treaties affect Canadian property sales.

Question 82- Hello, can non-residents claim the principal residence exemption? 

Answer 82- In limited cases, yes. However, the exemption is much more restricted for non-residents, and years of non-residency typically do not qualify. Incorrect claims are a common issue. 

👉 See when the principal residence exemption may apply.

Question 83- Hi Alf....what happens if I don’t apply for a Certificate of Compliance on time? 

Answer 83- If no certificate is obtained, the buyer must withhold and remit the full statutory amount. Recovering excess withholding usually requires filing a Canadian tax return and can take time. 

👉 Read about common non-resident property sale mistakes.

Question 84- Hi, hope you’re doing well. What’s the difference between NR6 and Section 216 for rental income? 

Answer 84- NR6 is used to reduce withholding during the year by estimating net rental income, while Section 216 is a tax return filed after year-end to calculate the actual tax payable. They serve different purposes but are often used together. 

👉 Read more: NR6 vs. Section 216 – Which Is Better for Rental Income?

Question 85- Hello, do I need to file NR6 to submit a Section 216 return? 

Answer 85- No. A Section 216 return can be filed without NR6. However, if NR6 is approved, filing a Section 216 return becomes mandatory. 

👉 Learn how NR6 and Section 216 interact.

Question 86- Hi there...does filing NR6 mean I don’t need to file a tax return anymore? 

Answer 86- No. NR6 only reduces withholding during the year. A Section 216 return must still be filed after year-end, usually by June 30, to report the rental income. 

👉 See why NR6 does not replace a tax return.

Question 87- Hello, when should NR6 be filed for Canadian rental income? 

Answer 87- NR6 should generally be filed before the rental year begins or before the first rental payment of the year. Late filings may not be accepted by the CRA. 

👉 Read about NR6 timing and deadlines.

Question 88- Hi, what happens if I file NR6 but forget to file Section 216? 

Answer 88- Failing to file a Section 216 return after NR6 approval can lead to penalties, denial of the withholding reduction, and reassessment on gross rent. 

👉 Learn about common NR6 and Section 216 mistakes.

Question 89- Hello, is Section 216 beneficial if my rental expenses are high?

Answer 89- Yes. Section 216 allows non-residents to deduct rental expenses and be taxed on net income instead of gross rent, which often reduces overall tax. 

👉 See when Section 216 makes sense.

Question 90- Hi there...can tax treaties eliminate the need for NR6 or Section 216? 

Answer 90- No. While tax treaties may reduce withholding rates, they do not remove the option to be taxed on net rental income. NR6 and Section 216 are still relevant. 

👉 Learn how tax treaties affect rental income.

Question 91- Hello, should I talk to a tax professional before filing NR6 or Section 216? 

Answer 91- Yes. NR6 creates strict filing obligations, and incorrect estimates or missed deadlines can be costly. Professional advice helps ensure compliance and proper tax planning. 

👉 Learn why planning matters for non-resident landlords.