--------------------------------------------------Hello,I saw your car the other day and thought you might be the person to talk to.I am a Canadian living here in West Vancouver. My wife is a US citizen. We have recently bought a house in the US Virgin Islands (US territory) and are thinking of purchasing a home on the US mainland. We have put our house up for sale here and I would like to move from Canada. My accountant at KPMG has told me I will face significant departure taxes if I leave Canada. I would like to minimize and or avoid paying these taxes. Can you be of help?Cheers,
david ingram replies:
I love it when someone calls from the car advertising. When I had my office in Park Royal, no one ever seemed to come in from the $7,500 sign out front but when I put signs on my beat up $3,000 Jeep Grand Wagoneer, someone would come in almost every day from the car. Now I have 5 Jeep Grand Wagoneers and 7 old Cadillacs with signs. Will have 8 Cadillacs with signs next week because I just brought an 87 Cadillac Hearse in from the US, It is down at BROCO for a new windshield and is then going to have a sign saying - "DON'T LET TAXES BE THE DEATH OF YOU" on it.
Back to your leaving the country question. That is what I do. My associates and I specialize on Canadians in the US and Americans in Canada. Because Americans in Canada (like your wife) have to file US returns every year no matter where their money comes from, we have many more Americans than Canadians as clients for this purpose. At any one time, we will have clients in 60 to 80 countries and 49 states. For instance, in the next month, I am doing seminars on retiring to Mexico in Vancouver Calgary and Toronto.
Back to your question
I am sure that I do more of these than anyone else in Canada but I do not know if I can help you any more than the help you are already getting from KPMG. The Vancouver and Halifax KPMG offices are some of the few places that I recommend for US / Canada Income tax help as you will see at the end.
If you are leaving the country, there may be significant departure taxes calculated on forms T1161, T1243 and T1244. However, you are not obligated to pay those taxes if you post security for them. The HSBC and other banks regularly provide letters of credit to the CRA for this purpose.
This LOC allows you to defer paying the tax to the CRA until you actually sell the article.
NO LOC IS REQUIRED for Real Estate, Company pension plans or RRSP accounts.
.
Usually, a LOC is only required if you are leaving behind an active stock trading account.
Now the problem is that there are very few people in Canada equipped to handle your cash stock trading account if you are living in the United States or its territories because of US securities Law which make it illegal for a Canadian Broker to even talk to you on the phone about your account if you are physically in the United States unless his Company and HE or SHE themselves have registered as well in the USA AND the STATE you are in.
Even Fred Snyder, the man I recommend most can only talk to those in Ontario and BC because of his licensing.
For someone like yourself, I usually recommend Darryl Thompson at Blackmont Securities in Toronto or Dan Walkow at Seabank Capital in White Rock. You are here so you should call Dan. If you go to www.Seabankcapital.com you will see what I mean because it starts off with a US / Canadian flag.
Dan does regular lectures in LA, San Diego, Palm Springs and Phoenix for the different Canadian Clubs there.
You can get hold of him at
Telephone: 604-541-9952 | Toll Free: 1-866-541-9952 | Fax: 604-542-5642
D.G.
(Dan) Walkow, CFA, CMT, Managing Director & Portfolio Manager:
[email protected]
Ajbinder (AJ) Sull, BBA,
MBA, CFA, Portfolio Manager: [email protected]
Paul Bains, BBA, MBA,
CFP, Associate Portfolio Manager: [email protected]
Seabank Capital Management
Inc.
Suite 301, 1959-152nd Street
White Rock, British
Columbia, Canada V4A 9E3
With regard to who to deal with, the people I recommend
for this kind of information (other than myself of course)
are:
Gary Gauvin is absolutely
qualified to deal with you. He is an old business partner of mine from
Ottawa. He now practices outside of Dallas Texas as a one or 1 1/2 person
office. If you deal with Gary, you will deal with Gary. He is a US
enrolled agent. You can find his website easily. Type - income Tax
Expert - into google. Gary will come up as number one or two.
Why, because he is. If I am looking for a first or second opinion, I call
Gary. Disadvantage - Gary is a one and a half person office.
Advantage - You will always get to talk to Gary.
Gary likes
corporations. I and my four associates do not like them. I like
dealing with individuals who deal cross-border withOUT
corporations.
OR KPMG in Vancouver. The last
time I checked they had 22 people in their US/Canada department.
call (604) 691-3025. Advantage - Lots of Backup. Disadvantage - It
will be hard to get the same person to deal with you three times in a
row.
OR Steve Peters with KPMG in Halifax (902)
492-6011
OR Kevin Nightingale in Toronto (416)
733-9595
OR Mark
Serbinski in Toronto
(416)733-0300
OR Len
Vandenberg with BDO Dunwoody in Kelowna, BC. (250)
763-7600
OR Steve Katz in Vancouver
at (604) 732-1515
OR Brad Howland in
Victoria at (250) 598-6258
Whoever you choose, you would likely do well
to consult with me for one or two hours a year. If I have a suggestion, it
will be worth it. If I can't come up with anything, you will know that
what you are doing is likely the best track. I will compare it to my
dentist, Ed Clarke. When I went in the fall of 2005, I ended up with
$16,000 to $18,000 of dental bills, a root canal, a bunch of pain, and a lot of
nice new caps, etc.
When I went for an inspection on Jan 29, 2008,
he could not find anything wrong except that I was not flossing.
Which one did i appreciate more?
Well both - the first time was expensive
but dealt with years of neglect. The second said I am on the right
track.
Good luck.
Looking at the California Non-resident
Adjustment Form CA(NR) will give you another idea of how this leaving the
country stuff works for taxation after you have left and still have assets back
in Canada.
. http://www.ftb.ca.gov/forms/07_forms/07_540nrca.pdf
One other thing. Your wife will have to sponsor you for a green card for you to go and live with her in the US and that means doing the paperwork through Montreal. If you kept the house in Canada, you could visit her in the US for up to six months at a time. However, without a full blown home in Canada (or Itakly, or Australia, or even the British Virgin Islands, you can not be a visitor to the US. AND!!! Under the circulstances you have described, your BC medical will also be cancelled or ineffective 90 days after you leave. Make sure you have arranged for Medical BEFORE you go.
-----------------------------
US / Canada / Mexico tax, Immigration and working Visa Specialists
US / Canada Real Estate Specialists
My Home office is at:
North Vancouver, BC, CANADA, V7N 3L7
Cell (604) 657-8451 -
(604) 980-0321 Fax (604) 980-0325
Calls welcomed from 10 AM to 9 PM 7 days a week Vancouver (LA) time - (please do not fax or phone outside of those hours as this is a home office) expert US Canada Canadian American Mexican Income Tax service help.
$1,700 would be for two people with income from two countries
Catch - up returns for the US where we use the Canadian return as a guide for seven years at a time will be from $150 to $600.00 per year depending upon numbers of bank accounts, RRSP's, existence of rental houses, self employment, etc. Note that these returns tend to be informational rather than taxable. In fact, if there are children involved, we usually get refunds of $1,000 per child per year for 3 years. We have done several catch-ups where the client has received as much as $6,000 back for an $1,800 bill and one recently with 6 children is resulting in over $12,000 refund.
Email and Faxed information is convenient for the sender but very time consuming and hard to keep track of when they come in multiple files. As of May 1, 2008, we will charge or be charging a surcharge for information that comes in more than two files. It can take us a valuable hour or more to try and put together the file when someone sends 10 emails or 15 attachments, etc. We had one return with over 50 faxes and emails for instance.
--IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, please be advised that any U.S. tax advice contained in this communication (including any attachments) is not intended or written to be used or relied upon, and cannot be used or relied upon, for the purpose of (i) avoiding penalties under the Internal Revenue Code, or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.--
-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 for expert help, assistance, preparation, or consultation in connection with personal or business affairs such as at www.centa.com or www.garygauvin.com. If you forward this message, this disclaimer must be included." -
