QUESTION: I am temporarily living in Malaysia but CCRA has determined that I remain a "factual resident" of Canada. Based on my 2004 tax assessment I have room in my 2005 RRSP. However, I have been told by my bank (BOM) that I cannot make further contributions to my already existing RRSP mutual fund account unless I return to BC. Is that correct? They would open a non-mutual fund RRSP account for me. Your comments please. =========================================================== david ingram replies: The CRA has not told you that A factual resident in a treaty country is not necessarily taxable in his foreign income. You do not need deep research by a team of lawyers and accountants to find this out. For instance in the T1-General Guide, Page 9, Part D, it clearly states that if you are under a treaty, this may not apply to you. You should not likely buy an RRSP and, in truth, you may not qualify for tax exclusion under Article IV of the Canada Malaysia Income Tax Convention. However, you "do" need to sit down or consult by phone with someone who does understand the treaty and non-resident rules. I charge $375.00 an hour for that kind of consultation by phone. If it is determined that you are a "taxable" factual resident as opposed to a non-taxable factual resident and you do need a RRSP, use your Canadian Address and buy the plan you want from someone who does NOT know you are living in Malaysia. Although technically illegal for the securities or mutual fund people to sell it to you if you are not living in BC (A B C mutual fund sales person can not sell you mutual funds if you move to Alberta either), there are 69,000 (just a guess) people in similar situations to yours, buying their RRSP's by using their brother's, sister's, parents', friend's or even in a couple of cases I have dealt with lately, the actual address of their mutual fund salesman. I have to tell you that the latter action is just plain stupid. In both of the cases, I have dealt with this year the problem came to light when the mutual fund person (in one case) and the life insurance salesman (in the other) died. The following is the actual wording from the treaty: Article IV Fiscal Domicile 1. For the purposes of this Agreement, the term "resident of a Contracting State" means any person who, under the law of that State, is liable to taxation therein by reason of his domicile, residence, place of management, place of incorporation or any other criterion of a similar nature. 2. Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his status shall be determined as follows: a) he shall be deemed to be a resident of the Contracting State in which he has a permanent home available to him. If he has a permanent home available to him in both Contracting States, he shall be deemed to be a resident of the Contracting State with which his personal and economic relations are closest (hereinafter referred to as his "centre of vital interests"); b) if the Contracting State in which he has his centre of vital interests cannot be determined, or if he has not a permanent home available to him in either Contracting State, he shall be deemed to be a resident of the Contracting State in which he has an habitual abode; c) if he has an habitual abode in both Contracting States or in neither of them, he shall be deemed to be a resident of the Contracting State of which he is a national; d) if he is a national of both Contracting States or of neither of them, the competent authorities of the Contracting States shall settle the question by mutual agreement. 3. Where by reason of the provisions of paragraph 1 a person other than an individual is a resident of both Contracting States, the competent authorities of the Contracting States shall be mutual agreement endeavour to settle the question and to determine the mode of application of the Agreement to such person. ================================ Answers to this and other similar questions can be obtained free on Air every Sunday morning. Every Sunday at 9:00 AM on 600AM in Vancouver, I, david ingram am a permanent guest on Fred Snyder of Dundee Wealth Managers' LIVE talk show called "ITS YOUR MONEY" Those outside of the Lower Mainland will be able to listen on the internet at www.600AM.com <http://www.600am.com/> Call (604) 280-0600 to have your question answered. BC listeners can also call 1-866-778-0600. Callers to the show and questioners on this board can also attend the Thursday Night seminars on finance and making your Canadian Mortgage Interest deductible. David Ingram's US/Canada Services US / Canada / Mexico tax, Immigration and working Visa Specialists US / Canada Real Estate Specialists Home office at: 4466 Prospect Road North Vancouver, BC, CANADA, V7N 3L7 Cell (604) 657-8451 - (604) 980-0321 Fax (604) 980-0325 Calls welcomed from 9 AM to 9 PM 7 days a week (please do not fax or phone outside of those hours as this is a home office) email to taxman at centa.com <mailto:taxman at centa.com> www.centa.com <http://www.centa.com/> www.david-ingram.com <http://www.david-ingram.com/> Disclaimer: This question has been answered without detailed information or consultation and is to be regarded only as general comment. Nothing in this message is or should be construed as advice in any particular circumstances. No contract exists between the reader and the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent and appropriately qualified legal practitioner or tax specialist in connection with personal or business affairs such as at www.centa.com <http://www.centa.com> . If you forward this message, this disclaimer must be included." Be ALERT, the world needs more "lerts" This from "ask an income tax and immigration expert" from www.centa.com <http://www.centa.com/> or www.jurock.com <http://www.jurock.com/> or www.featureweb.com <http://www.featureweb.com/> . 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