Chapter 20 – Introduction / Residency
a. Peter
· Peter is a non-resident for income tax purposes and will pay Canadian tax on his Canadian source employment income. The 183-day sojourner rule would not apply because he does not stay overnight.
b. John
· Part time resident with a clean break occurring on July 30, the later of three dates:
· Date of departure (May 1)
· Date of spouse and children’s departure (July 30)
· Date of household being set up (July 30)
From January 1 – July 30 he is a resident. He will pay Canadian tax on his Canadian income until April 30. From May 1-July 30 he will be dually taxed and pay Canadian tax on his World Wide Income (WWI) and from August 1-December 31 he is a non-resident and will pay US tax on his US income.
c. Stacey
· Considered a Canadian resident as she is primarily a resident of Canada. The fact that she is a U.S. citizen is irrelevant in determining her residential status. Her position in Colorado is temporary in nature. She will be dually taxed during her summer months (i.e. pay Canadian tax on her WWI and US tax on her US income).
d. Susan
· Considered a deemed resident as she is a dependent child of an individual stationed in the armed forces. Her father is a deemed resident of Canada for income tax purposes as well.
e. Dennis
· Appears to primarily reside in US (duration of stay and nature of employment are indicative of a permanent residence), therefore he should be considered a non-resident.
Chapter 20 – Residency question
The following is a list of factors that could be used to determine the residency for tax purposes of an individual. Determine whether the factor determines the person is a resident or non-resident of Canada for tax purposes. Consider each factor independently.
Factor
Resident
Non-resident
1. Mr. A moves from Canada to another country. He puts all...
