Cross Border Tax Consultants

Are you confused about Canadian Income Tax Rules? Should you be reporting your foreign rental income in Canada? Well, let us find out. Regarding reporting rental income for Canadian income tax purposes, foreign and domestic rental income are regarded equally. A Canadian taxpayer must therefore reveal all of their worldwide income. What if the cost of foreign properties is more than $100,000 CAD? Then you must fill out the T1135 form, which is also known as the foreign income verification statement. Continue reading to learn more.     How to Report Foreign Rental Income? • To report your foreign rental income while filing income tax returns in Canada, fill out the T776 Form, also known as the Statement of Real Estate Rentals. • Keep in mind that your international rental income must be reported in Canadian dollars • To avoid double taxation, income taxes paid to the foreign jurisdiction on rental income can be claimed as a foreign tax credit on the taxpayer's Canadian incom...

When paying your taxes annually, you need to include all of your foreign income on your return – including details of your foreign properties. And this goes to any taxpayer who is required to pay taxes in Canada - whether you reside in the country or are a Canadian resident who lives abroad. But how exactly does the Canada Revenue Agency (CRA) know about your foreign properties? Let us find out. T1135 Form and its Significance If you live in Canada, your income from all sources is subject to tax. There are severe penalties for failing to disclose your worldwide income in Canada accurately. The country's voluntary tax system depends on individuals accurately and honestly declaring their income and paying their income taxes. It's why criminal sanctions may occasionally be part of the penalties. If you own foreign property with a value of more than $100,000, you are required to submit a Form T1135 Form once a year. This is done to ensure that all Canadian residents accurately ...

  Are you confused about whether to hire a lawyer or accountant to complete your Voluntary Disclosure Program? What if we tell you that you don't need them? But before getting into that, we need to learn more about the CRA's Voluntary Disclosure Program. Read on to know more. What is the Voluntary Disclosure Program? Many people make errors, intentional omissions, or misreporting regarding taxes. If you happen to be one of those people, there's a way around it. There is a chance that you will be treated fairly by the Canadian tax system. Through the Voluntary Disclosure Program (VDP), run by the CRA, you get a second chance to fix any inaccurate or late tax files. The voluntary disclosure program allows taxpayers to make changes to their tax affairs. VDP lets you correct your mistakes of the ten prior taxation years. Additionally, VDP aids in shielding non-compliant taxpayers from legal action. If you need to file pending tax returns with the CRA or correct prior tax file...

Worried about filing your income tax returns? Did you forget to consider your foreign rental income? Now you are worried about the penalties. What if we tell you that there is a way around it? So, can you really avoid penalties on T1135 late filing? Read on to learn more. What is the T1135 Form? The CRA, short for the Canada Revenue Agency uses the T1135 form to obtain information on the number and income generated through foreign assets that are held by the residents of Canada. Form T1135 is also known as Foreign Income Verification Statement. Who should Fill it? You must file the T1135 form, also known as the Foreign Income Verification Statement if you own foreign property worth more than 100,000 Canadian Dollars at any time during the year. This is applicable to all individuals, trusts, and partnerships. When completing the foreign income verification statement, you must consider the property's cost rather than its current value. An individual need not complete the T1135 f...

If you have intentionally misreported, consider the Voluntary Disclosure Program (VDP). You will still have to pay the taxes owing and the interest generated due to the corrections but if your application is accepted by the CRA you could receive penalty relief or prosecution relief and some of your interest generated could also be waived off.   To apply for VDP, certain criteria need to be met: i) The disclosure must be made before the CRA finds out about it and contacts you. ii) You should provide complete information. iii) The information must be older than a year iv) You must be facing penalties or tax charges. It is always advisable to seek professional advice from a qualified accountant as it is difficult to keep track of all the rules and changes made in tax filing. You are also more prone to making mistakes that could cost you a lot if you do not have the proper knowledge. If you are looking for expert advice and assistance regarding your individual income tax return,...

Did you claim the wrong deduction on your taxes? Or, did you forget to state a job income that you had a T4 for? Mistakes can cost you a lot, especially when making mistakes in filing tax returns.   Here are some common mistakes you need to look out for a while filing your personal tax return. 1. Failing to report Principal Residence Exemption The Principal Residence Exemption provides an exemption from tax on any profit gained from the sale of property that is designated as your principal residence. The sale must be reported on your tax return along with the designation on the second page of Schedule 3. You should also fill sections related to the principal residence in Form T2091. 2. Not Reporting Foreign Properties and Income If you owned any foreign property with a total cost exceeding $100,000 at any time of the year, you are required to submit Form T1135 along with your tax return by the due date. Failure to do so will result in a hefty penalty of $25 per day, which is ...