How Can Canadian Save Taxes While Working In The US?
Many Canadian cross border to work in the US. The better job opportunity in the US comes with a big concern: Double Taxation.
When a Canadian Citizen come and work in the US, both countries can technically tax her on her income. If you try to do your taxes by yourself, or retain a CPA who is not specialized in international taxation, you are most likely paying more taxes that you are supposed to.
One of the main factor in avoiding the double taxation is determining your residency status according to the tax law. In general, since the US tax rate is lower than that of Canada, it is more beneficial for you to be a US resident and file as a non-resident in Canada. One problem our client could run into is that CRA presumes that an individual maintains Canadian tax residency if they leave Canada for less than two years. In this case the individual will be treated as both US and Canada tax resident and thus subject to double taxation, but this is where the expertise in international taxation and US/Canada tax treaty comes handy and the fun begins!
By using the US/Canada tax treaty, we can determine your residency in a way that is advantageous to you. That is why it is crucial that you consult with us before moving to the US or as soon as possible, so that we can advise you on things you need to do in order to be a resident of one country or another.
Tax treaty is more complicated and out of the scope of this article, but a in general, if you are a tax resident of both countries, if you have a "permanent home" available to you at all time, you will be considered the resident of that country. Every word in the tax treaty is a term of art and must not be confused with its generally accepted meaning. That why it is very important for you to let an international tax expert handle your tax planing and preparation.
When a Canadian Citizen come and work in the US, both countries can technically tax her on her income. If you try to do your taxes by yourself, or retain a CPA who is not specialized in international taxation, you are most likely paying more taxes that you are supposed to.
One of the main factor in avoiding the double taxation is determining your residency status according to the tax law. In general, since the US tax rate is lower than that of Canada, it is more beneficial for you to be a US resident and file as a non-resident in Canada. One problem our client could run into is that CRA presumes that an individual maintains Canadian tax residency if they leave Canada for less than two years. In this case the individual will be treated as both US and Canada tax resident and thus subject to double taxation, but this is where the expertise in international taxation and US/Canada tax treaty comes handy and the fun begins!
By using the US/Canada tax treaty, we can determine your residency in a way that is advantageous to you. That is why it is crucial that you consult with us before moving to the US or as soon as possible, so that we can advise you on things you need to do in order to be a resident of one country or another.
Tax treaty is more complicated and out of the scope of this article, but a in general, if you are a tax resident of both countries, if you have a "permanent home" available to you at all time, you will be considered the resident of that country. Every word in the tax treaty is a term of art and must not be confused with its generally accepted meaning. That why it is very important for you to let an international tax expert handle your tax planing and preparation.
Contact us
Email: Info@Qtaxservices.com
Phone: (424) 888-3878
rental income on primary residence, self rental recharacterization rules, sale of rental property that was primary residence, stonefield josephson, s corp rental income, state tax incentives for business, sale of personal residence converted to rental property, converting personal residence to rental property, marcum new york, turning home into rental, turning your home into a rental,
Phone: (424) 888-3878
rental income on primary residence, self rental recharacterization rules, sale of rental property that was primary residence, stonefield josephson, s corp rental income, state tax incentives for business, sale of personal residence converted to rental property, converting personal residence to rental property, marcum new york, turning home into rental, turning your home into a rental,