Taxes back home in Canada on earnings in KSA?

Hello puckbunny.

Welcome to Expat.com!

Hope you'll be helped by other members soon.

Thank you,
Aurélie

In case u haven't got answered, spoke to a Canadian today on this...
As per him there are tax implications on your international earnings if you still have significant interests in Canada while working abroad... these 'significant interests' are :-
1. House in Canada
2. Owned Car
3. Spouse & Kids
4. Secondary interests are bank account etc.

Though as per him since Canada doesn't have any tax treaty with KSA unlike UAE, they would take your income as whatever you declare...

Thank you for the response

what about canadians with no significant interests in Canada? is there a person I can contact in riyadh?

On your annual T1-General, whether you reside in Canada or elsewhere, you MUST declare your "World Income", if you are a non-resident for income tax purposes there is a special T1 General for Non-Residents and it, in fact, has an entire separate page devoted solely to "World Income" - Schedule A and you are required to report foreign income from any source.

In order to be exempt from filing an annual T1-General you must file a NR-5 which essentially states that you are no longer a resident of Canada for income tax purposes every 5 years. This declares that you have no substantial ties to Canada (as noted in the previous posting) and from the point that it is accepted and non-resident status is granted if you do have any Canadian sourced income such as rental income, bank interest, capital gains on sale of property, anything at all you will pay a 25% withholding tax which is deducted at the source. This quits ANY tax liability that you have on that income, you are NOT required to file a T1-General return and you do not get any income tax refund on what has been withheld.

This will create problems should you start receiving CPP/QPP, DVA Pension, private pensions, annuities, etc., because the withholding tax is much greater than you'd probably pay if you filed a return annually. At that point you want to start to file again under Part 217, since you can then obtain a refund should one be due. You may also file a new NR-5 if you have no foreign income at that point and this would request a reduction in the withholding tax. For example mine was dropped from 25% down to 10.

Regardless of the existence of any bilateral Tax Treaties, you still will declare foreign income and that is NOT TO SAY you'll necessarily pay Canadian Income Taxes on that income, but you may be required to. It may also have the overall effect of bumping you up into a higher income tax bracket, which will mean you owe a proportionately higher tax on all your Canadian income.

Don't forget that the deadline for filing is April 30th each year (which has passed for the 2013 tax year), and if you OWE income taxes this late filing will generate a fine. If you are entitled to a refund, there is no fine that applies to late filing.

Cheers,
William James Woodward, EB Experts Team

This is too complicated for me :S I filed my tax return somewhere in mid March. I filled the n73 form declaring that I don't reside in Canada anymore and consulted with a tax specialist who guaranteed that there is nothing left for me to do. I hope next year I will find someone who helps me with my taxes here in KSA or maybe I'll buy one of those programs that ask questions and simultaneously fill my tax form. Hopefully I'm tax stress free for a year

Ooh I forgot to say THANK YOU!! You really know a lot about tax have a great day

Like the old saying goes... "The only two things you can't avoid are death and taxes".

Income taxes and tax implications are just things that are part of the considerations that should make up part of anyone's decision making process when thinking about living and working abroad.

On the brighter side, things could always be worse! You could be a US citizen, a country that taxes based on citizenship, not on residency. Americans have to file an annual 1040 return every single year, report their foreign sourced income and now under the new FATCA laws foreign banks must also report balances of their American account holders to the IRS. The only way around this is when one renounces their US citizenship, in which case they will pay an astronomical Exit Tax, which is calculated as if you sold or liquidated every single asset you ever had, home, car, bank accounts, investments, businesses, you name it on the day before you renounced. YIKES! They really have no protection from double taxation in countries that do not have a Tax Treaty with the USA.

Hi All,

I know this is an old thread. I am planning to send my wife to live in Canada as a PR and I will stay working in Saudi Arabia. My wife will be considered as a significant ties to Canada and hence I will have tax obligations.

Looking for anybody to share his experience with such situation. I want to know what expenses I can claim, what supporting documents the CRA agent my request while filing for income tax, ….etc. More details will be great to have so that I can take a decision.

Regards

Amin