Determining your residency status in Canada

Determining your residency status

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·???????? Under Canada's tax system, your income tax obligations to Canada are based on your residency status.

·???????? ?You?need to?know your residency status before you can know what your tax?responsibilities and filing?requirements to Canada are.

·???????? To determine your residency status, all of the relevant facts in your case must be considered, including residential ties with Canada and the length of time, purpose, intent, and continuity of the stay while living inside and outside Canada.

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The following steps can help you determine your residency status for income tax purposes and your tax obligations?to Canada.

Step 1: Determine?if you?have residential ties with Canada

The most important?thing to consider when determining your residency status?in Canada for income tax purposes is whether or not?you maintain or establish significant?residential ties with Canada.

Significant residential ties to Canada include:

• a home in Canada
• a?spouse or?common-law?partner?in Canada
• dependents in Canada

Secondary residential ties that may be relevant include:

• personal property in Canada, such as a car or furniture
• social ties in Canada, such as memberships in Canadian recreational or religious organizations
• economic ties in Canada, such as Canadian bank accounts or credit cards
• a Canadian driving license
• a Canadian passport
• health insurance with a Canadian province or territory

The information above is general in nature.

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Step 2: Determine your residency status and its tax implications

Your residency status if you?left Canada

You may be considered a?factual resident of Canada?if you maintain residential ties?with Canada and are:

• working temporarily outside Canada
• vacationing outside Canada
• commuting (going back and forth daily or weekly) from Canada to your place of work in the?United States
• attending school?in another country?

You may be considered an?emigrant?if you left Canada and established a permanent home in another country and you severed your residential ties?with Canada ceasing to be?a resident of Canada in the?tax year.?

You may be considered a deemed?non-resident?of Canada if you established residential?ties in a country that?Canada has a tax treaty with and you are considered a resident of that country, but you are otherwise a factual resident of Canada, meaning you maintain significant residential ties with Canada. The same rules apply to deemed?non-residents?as?non-residents?of Canada.

You are usually considered a factual resident or a deemed resident of Canada if you left Canada and you are a government employee outside Canada, which includes members of the?Canadian Forces?posted abroad.

Your residency status if you?entered Canada

You may be considered?an?immigrant?if you left another country to settle in Canada and established significant residential ties?with Canada and became a resident of Canada in the?tax year.

You may be considered a deemed?non-resident?of Canada if you have residential?ties in a country that Canada has a tax treaty with and you are considered to be a resident of that country, but you are also a factual resident of Canada because you established significant residential ties?with Canada. The same rules apply to deemed?non-residents?as?non-residents?of Canada.

You may be considered a?deemed resident of Canada?if you have?not?established significant residential ties with Canada to be considered a factual resident, but you stayed in Canada for?183 or more days?in the year.

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Your residency status if you normally, customarily, or routinely live in another country

You?may be?considered a?NRI?if you did?not?have significant residential ties with Canada and:

• You lived outside Canada throughout the year (except?if you were a deemed resident of Canada)
• You?stayed in Canada for?less than 183 days?in the tax year.

If you want?the CRA's?opinion on your residency status, complete?Form NR74, Determination of Residency Status (Entering Canada), or?Form NR73, Determination of Residency Status (Leaving Canada), whichever applies.

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