but it loses its tax-free status and you have to do additional reporting in the U.S. which is a net cost. you may as well close it, save some dough on tax reporting and reopen when you’re a resident again. in my experience, the additional cost of report on your tfsa in the U.S. is about $250 per year if done professionally.
the tfsa is unique in that it isn’t recognized as being tax-free by any other country. canada recognizes roths as being tax-free and thus roths can be held while in canada and the benefits of the roth are maintained, just that no new money can be added to the roth. if you’re a u.s. citizen living in canada, you shouldn’t use a tfsa as you will be taxed on your tfsa earnings on your u.s. return anyway and there is additional reporting necessary and you don’t accrue any roth contribution room as you’re not a u.s. resident. u.s. citizens in a canada have a pretty crappy situation in this regard. retail banks that allow you to open these accounts have no knowledge of the cross-border tax implications. i currently have three clients who have made mistake wrt to tfsas mostly due to lack of guidance from and likely negligence or outright fraud by employees at canadian bank branches. tfsas are a mess if you have any association with the u.s.
Ya TFSAs lose their tax-free status for a Canadian residing in the US. (no tax implications on a CDN tax return though). TFSAs aren’t considered foreign pensions under the CAD/US tax treaty and you would have to complete a couple forms each year and include when filing a US tax return.
^ Makes sense.
This is part of the reason I closed out my TFSA when I moved south of the border. It would have had no tax savings, since technically I’d have to report the earnings to the IRS, probably could have not bothered but that’s tax evasion. I no longer have any financial accounts in Canada so I don’t have to have anything to do with CRA anymore! yay!
^PA, why did you meet with the Investment Adviser?
Just networking and learning what’s up here, not for paid investment advice.
That assumes PA moves to the U.S. If he moves back to Korea, that’s a different game entirely.
Yes. I faced a CRA audit. They said I owed them $8K in back taxes. I told them to pound sand and won because they are idiots who lost the donation receipts that I had sent them. Not to mention other idiot mistakes that they constantly make for my parents’ tax returns relating for foreign pension income which are tax deductible under a tax treaty… which for some reason… they don’t understand year after year.
What you fail to understand is that the money that these people are brining over are “bribe money” or other corrupt form of money… do you honestly think they claim their bribe money on their Chinese tax return let alone claim them in Canada given that they try to avoid leaving an audit trail at all cost? There is a difference between what CRA suspects and what they can prove… and they can’t prove much with money coming in from overseas. You give the CRA way to much credit.
if you want to nit pick… fine its 50K for the first year, but that was implied in my initial post.
By your logic, anyone coming over to Canada with a PR should receive the support of Canadian people and government then? Why is it that non-Syrian refugees do not get their PR immediately and do not receive a welcome cheque? Why is it that people that apply for PR and come to Canada not receive a welcome cheque for $25K in year 1? Why not the people that come over on student visas, pay double the price for education that try to find jobs in Canada? Maybe you need to read more into it and realize this refugee crisis is a scam to generate liberal voters and for Justin to get some good global publicity
So… if they live in poverty, it gives them justification to bomb out of distress? Plenty of people living in poverty that do not resort of violence. Living in poverty to me means I should work harder, live frugally and hope to get myself out of poverty instead of waiting for more social assistance off the backs of other tax payers / government debt.
Honestly, at the end of the day, we can debate al day but you are left wing biased and I am right wing biased. If you truly believe that this is good for the economy… there is no convincing you and there is no convincing me because I can point out failed left-wing based economies and you can point out failed right-wing based economies. What I will say is that statistics show that even prior to the new tax structure, the top earners in Canada paid more than their fair share of the taxes and in my opinion, additional involvement by the government to “help the middle class” will have other consequences such as legal tax avoidance (ie. Murray Edwards), less trickle down effect and less innovation / growth.
Oh no, these guys sound as bad as the IRS!
Years ago I got aggressive letters out of nowhere, saying I owed some mysterious amount?? For what? It went on for a year, no answers, and escalating threats that they were going to “seize property”. For what? Nobody at their office could even tell me why they were asking for more money. Finally I figured it out – the idiots were asking for an amount I already paid years ago, plus interest. I sent them copy of the cashed check, and they STFU, but no apology.
Think of how much time/money is lost due to these institution’s incompetence? We are paying for that with our tax money. They should have paid me for my time spent fixing their crap record keeping.
These are our questions!
I swear the tuition is even more than double for foreign students. Was shocked. And I didn’t even know people were getting free $25K checks until this thread. We were discussing yesterday with some people; their system actually disincentives the good people they say they want, from coming. Desperate people with few options will keep trying, or break the law, to get in. People with options, will just get fed up and walk away. It’s a really cumbersome system.
so every chinese person in canada is corrupt. okay.
where the money comes from isn’t important. if the cra sees funds coming from out of country, they will investigate what the husband does and how much he makes on paper in China. some of what he makes could be off-the-record but he likely has a legit job of some sort that should have been reported to the cra. finding out this information is not difficult. the reason your experience with the cra was the way it was is because the sum in question is $8k and there was no intentional large scale tax fraud. if you’re talking about a federal crime, and potentially hundreds of thousands or millions in damages, the rcmp would be involved and the cra’s top people would be involved. it’s like saying goldman is crap because the guy i talked to one the phone in india about my $3k savings account there was an idiot. cra is a massive organization and obviously there are some very intelligent people there to work on the more pressing cases.
maybe the odd chinese family who has no earned income and somehow no investment income could get away with this but if we’re talking about the vast majority of landed chinese immigrants in canada who have plenty of earned or investment income, they wouldn’t be able to get away with this scheme for long.
current tax rates, even after the liberals moves, are still near all-time lows at the high end. the top marginal tax rate was well above 50% for much of Canadian history and the quantity of transfer payments is much higher now. all in all, we live in one of the lowest tax points in modern history, except for maybe the early 2000s. you’re saying that the “fair share of taxes” is the lowest tax rate in modern history. you don’t even know how good you (and I) have it right now.
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Maybe MLA can explain to me that how, in Nardia, increasing a truckers income tax from 30% to 50% will affect only, or even mostly just, the trucker? In Nardia, the median income is 50k. A trucker makes 250k. Very high barrier of entry for truckers in Nardia. Much like the artificial barriers for doctors in the States. A progressive tax system is just an illusion to please the masses and get elected. Surprised MLA can’t move beyond the bias of his upbringing. My guess anyway.
nardia? like narnia? or is nardia code for an actual place?
why are you targeting the truckers income in particular? why do truckers make 5x the median? are we now discussing regulatory barriers that inflate incomes? if so, that is an entirely different discussion.
a progressive tax system is effective if the tax on all sources of income are progressive, which they are in canada. a progressive system is only an illusion in the u.s. where tax on investment income is flat and is meaningfully lower than the higher brackets of earned income, which is backwards.
Oops. Narnia works. I think nardia has something to do with plant classication. So, in Narnia, what happens to the trucker’s gross income and the costs of goods, if the trucker’s income tax goes up? I think you’re having trouble with concept.
if its redistributed, the savings rate will likely go down and consumption rate likely go up. this could have an impact on near-term price levels, but virtually no effect on long-term price levels, and the net benefit to society is positive if the trucker’s utility for that cash is low, which it should be considering tax rates are near the lows of the past 8 decades. this is why income inequality is bad. savings rate at the top is too high given the current environment, restricting consumption and near-term inflation.
Might take is much different. There is no free lunch. The trucker’s gross income would increase so their net is close to what it was prior, long term of course. The cost of goods for everyone goes up. The drag on the economy is greater and the only group that benefits would be the special interest that gets a boast from the extra revenue at the expense of everyone else, if there is any extra revenue at all. There is never a free lunch.
Friedman blows away the myth of a free lunch.
Milton Friedman was also an advocate for free trade. I guess “Milton Friedman blows it away” only works when convenient. Seems to be the case for conservatives in general.