Canadian taxes

I have a friend here who is a non-resident for Canadian tax purposes.
Need recommendations for someone familiar with Mexican/Canadian tax treaties
and preparation of appropriate returns.


Thanks in advance.

Canuck wrote:I have a friend here who is a non-resident for Canadian tax purposes.
Need recommendations for someone familiar with Mexican/Canadian tax treaties
and preparation of appropriate returns.


Thanks in advance.

Retired tax preparer from Canada. PM me

Non-residents can choose to file a Section 217 tax return if they have had excessive tax withheld. Tax returns are not required and probably not worth the trouble unless you have significant income. Be prepared for incompetent review by CRA. My experience--they could not even deal with tax withheld on interest income and did not learn after two successful appeals. So if you go that route, a good idea to have an expert on non-resident tax. When CRA screws you, it is very difficult to fight them.

Gatosigi is correct. Our tax (15%) is witheld and paid on interest and dividends...we do not file and do not have to.
CRA screwed my mother and helped themselves to her bank account. After she went into a residence for those with Alzheimer's, I had an accountant fix the mess. He wrote a very nice letter to them explaining the circumstances of her chaotic tax returns and they returned all the penalties that they had charged her. Someone there has a heart.

ferret wrote:Gatosigi is correct. Our tax (15%) is witheld and paid on interest and dividends...we do not file and do not have to.
CRA screwed my mother and helped themselves to her bank account. After she went into a residence for those with Alzheimer's, I had an accountant fix the mess. He wrote a very nice letter to them explaining the circumstances of her chaotic tax returns and they returned all the penalties that they had charged her. Someone there has a heart.

Well to be truthful, not many of them have a heart, but yes according to the tax treaty signed between Mexico and Canada, 15% is it. No need whatsoever to send in a return.

Isn't it funny those letters they send out every year, advising you that it MAY be in your interest to file a return.....Oddly we have never considered that option, since it is pretty clearly in their interest to know all the details of every single thing we own, here, or elsewhere.

It may well be to your advantage to file a section 217 return.
15% generates quite a lot of tax.

A person over 65 would pay approximately $5400 tax on $50000. At 15% CRA will have about $7500 of your money so you should be getting about $2000 back.

Similarly the tax for a spouse getting $30000 would be about $2450 leaving about $3000 of the $4500 deducted to be refunded

If you wish to gift CRA thousands of dollars each year go ahead but at least have your tax position reviewed to find out if 15% is right for you

BTW the Canada/Mexico Tax Treaty does not enter in the formula very much. The max withholding for Canada should be 15% however a few letters that clients have been getting from their pension payers would lead me to believe they may have to withhold 25% starting Jan 1, 2013.

You should check with your pension payer to see if they will be doing that. This is new from CRA and effectively they are making Canadians claim the Tax Treaty benefits they entitled to living in Mexico or any other Country with which Canada has a Tax Treaty. Of course there are forms to fill out.

Living in Niagara Falls, Ontario I had many fights with both IRS and CRA over Treaty Benefits and Social Security Benefits. Most of the knuckleheads that work for either have no idea what a Tax Treaty is and it is hard to explain over the phone but their supervisors are easier to deal with.

It is NOT to OUR advantage...and, since we have already paid Capital Gains on a deemed disposition of assets, we will just leave it alone. The 15% is ONLY on interest, dividends and pensions...it's a pittance.