On this page…

• What if you need help?
• T.I.P.S.
• Internet access
• Publications
• Before you contact us
• Contacting us
• Getting personal tax information
• Representatives
• General information
  • Determining your residency status
  • Were you a non-resident in 2004?
  • What are residential ties?
  • Were you a non-resident in 2004 who wants to elect under section 217?
  • Were you a non-resident in 2004 who wants to elect under section 216.1?
  • Were you a deemed non-resident in 2004?
  • Were you a deemed resident in 2004?
  • Were you a member of the overseas Canadian Forces school staff who left Canada in 2004?
  • Did you live in Quebec just before you left Canada?
• Before you start
  • Do you have to file a return?
  • What date is your return for 2004 due?
  • Deceased persons
  • What penalties and interest do we charge?
  • Penalties
  • Interest
  • Social insurance number (SIN)
  • Canada Child Tax Benefit (CCTB) and Child Disability Benefit (CDB)
  • Is this tax and benefit package for you?
  • What if this tax and benefit package is not for you?
  • How can you get the tax and benefit package you need?
• Getting started
  • What do you include with your return and what records do you keep?
  • What if you are missing information?

What if you need help?

In this guide, we use plain language to explain the most common tax situations. If you need more help after reading this guide, you can contact us (see later on this page) or use our other services.

If you work in the film or video production industry and you need more information, you can visit our Web site at www.cra.gc.ca/fsu. You can find the telephone or fax numbers for the Film Services Unit on our Web site.

T.I.P.S.

For personal and general tax information by telephone, you can use T.I.P.S.

Internet access

Visit our Web site at www.cra.gc.ca. General information, forms, and publications are accessible by topic and by client group.

My Account (www.cra.gc.ca/myaccount) is a secure online service that gives you the convenience and flexibility of viewing your personalized information, such as: your identification, refund or balance owing, instalment account, RRSP, Home Buyers' Plan, Lifelong Learning Plan, Canada Child Tax Benefit, and GST/HST credit. You will also be able to file an objection online.

Publications

Throughout this guide, we mention forms, pamphlets, interpretation bulletins, information circulars, and other guides that give more details on specific tax topics.

You can get most of our publications, including the General guide and forms book, the return, and any of its schedules by themselves, by visiting Web site at www.cra.gc.ca/forms or by calling 1-800-959-2221 (from Canada or the U.S.) from 8:15 a.m. to 5:00 p.m. (Eastern time). If you are outside Canada and the U.S., call the International Tax Services Office.

You can also get the General Income Tax and Benefit Guide for Non-Residents and Deemed Residents of Canada from most Canadian embassies, high commissions, or consulates.

Before you contact us

We want to provide you with the best service possible. By being prepared in advance, you will help us serve you better. Before contacting us you should do all of the following:

• read the appropriate sections of this guide and other publications we mention in this guide;
• prepare all the details of your situation and question; and
• have on hand the working copy of your return, any related receipts, a pencil and paper, and your social insurance number (SIN) or temporary taxation number (TTN).

Contacting us

The address and telephone numbers of the International Tax Services Office are listed on the back cover of this guide and on our Web site at www.cra.gc.ca.

You may have difficulty reaching us during peak periods; however, our goal is to respond to your call within two minutes and to serve you in the official language of your choice.

By phone - You can call us at the International Tax Services Office Monday to Friday (except holidays) from 8:15 a.m. to 5:00 p.m. (Eastern Time) year-round. However, from mid-February to the end of April, these hours are extended to 9:00 p.m., Monday to Thursday.

By fax - You can send us correspondence by facsimile. However, because of the nature of facsimile services, we are not responsible for misdirected, incomplete, or illegible documents.

Getting personal tax information

The personal information that you provide on your income tax forms is collected under the authority of the federal, provincial and territorial income tax acts and will be used to administer and enforce these acts and their regulations. For more information, refer to Personal Information Bank Number CRA/P-PU-005 at http://infosource.gc.ca or in the Infosource book, or call the International Tax Services Office.

Your personal information is confidential. However, you can authorize someone (such as your spouse or common-law partner) to represent you to discuss your file. See "Representatives" in the next section. In certain cases, we give some of your information to other government bodies to administer the law. In all cases, we follow strict procedures before giving your information to anyone.

If you visit us and ask for personal tax information, we will ask you to identify yourself. In addition, we will ask for one of the following:

• one piece of signed identification with your picture;
• two pieces of signed identification;
• your Notice of Assessment, Notice of Reassessment, or other tax documents; or
• information about the contents of your return.

If you call us and ask for personal tax information, we will ask you to identify yourself and give information about the contents of your return. If you call before May 1, use your return for 2003. After April 30, use your return for 2004.

Representatives

You can authorize a representative (such as your spouse or common law partner, tax preparer, or accountant) to get information on your tax matters. However, we will give information to your representative only after we are satisfied that you have authorized us in writing to do so. Your authorization will stay in effect until you cancel it.

Authorizations received between mid-March to mid-July will be processed within 4 weeks and any authorizations received mid-July to mid-March will be processed within 1 week.

Note
Authorizing a new representative does not cancel your existing authorizations. You can now cancel any authorization by telephone.

If your representative visits us and asks for your personal tax information, we will give this information only if we have received, from you or your representative, a completed Form T1013, Authorizing or Cancelling a Representative (or a letter containing the same information), that you have signed. After we confirm that we have your written permission, we also will ask your representative for either of the following:

• one piece of signed identification with his or her picture; or
• two pieces of signed identification.

In addition, we will ask for either of the following:

• your Notice of Assessment, Notice of Reassessment, or other tax documents; or
• information about the contents of your return.

If your representative calls us and asks for your personal tax information, we will give this information only if we have received a completed Form T1013 or letter that you have signed. After we confirm that we have your written permission, we also will ask your representative for information about the contents of your return. A representative who calls before May 1, should use your return for 2003. A representative who calls after April 30, should use your return for 2004.

If you are the representative for a deceased person, get guide T4011, Preparing Returns for Deceased Persons , to know what documents are required.

General information

Determining your residency status

Were you a non-resident in 2004?

You are a non-resident of Canada for tax purposes throughout any period in which you do not have significant residential ties in Canada and you are not a deemed resident of Canada.

What income should you report? - Report your 2004 income from Canadian sources such as the taxable part of your scholarships, fellowships, bursaries, net research grants, income from a business, and taxable capital gains from disposing of taxable Canadian property, as indicated under the income lines applicable to non-residents in the guide.

What are residential ties?

Significant residential ties almost always include a home in Canada, a spouse or common-law partner, and dependants who stayed in Canada while you were living outside Canada. Other ties that may be considered significant include a Canadian driver's licence, Canadian bank accounts or credit cards, provincial or territorial hospitalization insurance coverage, personal property, and social ties in Canada. For details on residential ties, see Interpretation Bulletin IT-221, Determination of an Individual's Residence Status , or contact the International Tax Services Office.

Were you a non-resident in 2004 who wants to elect under section 217?

Under section 217 of the Income Tax Act, you can choose to report certain types of Canadian-source income on a Canadian return and pay tax on that income using an alternate taxing method. Choosing to do this is called "electing under section 217." For detailed information on electing under section 217, including the types of income to which section 217 applies, see "What is a section 217 election?"

Were you a non-resident in 2004 who wants to elect under section 216.1?

Under section 216.1 of the Income Tax Act, if you are a non-resident actor, you can choose to report amounts paid, credited, or provided as a benefit to you for film and video acting services rendered in Canada on a Canadian return and pay tax on that income using an alternate taxing method. Choosing to do this is called "electing under section 216.1." For detailed information on electing under section 216.1, see "What is a section 216.1 election?"

Were you a deemed non-resident in 2004?

You may be a deemed non-resident of Canada in 2004 if you were a resident of Canada in 2004, and, under a tax treaty, you were considered to be a resident of another country. If this is the case, the same rules apply to you as to a non-resident (including the way you complete your return).

Were you a deemed resident in 2004?

You were a deemed resident of Canada for tax purposes if you did not have residential ties in Canada, but you stayed here for 183 days or more in 2004 and, under a tax treaty, you were not considered a resident of another country.

You were also a deemed resident if you lived outside Canada during 2004, you did not have residential ties in Canada, and you were:

• a member of the Canadian Forces at any time in 2004;
• a member of the Canadian Forces overseas school staff and you choose to file a return as a deemed resident (if you left Canada during 2004, see "Were you a member of the overseas Canadian Forces school staff who left Canada in 2004?" on this page);
• a federal or provincial government employee and you were either resident of Canada just before being posted abroad or you received a representation allowance for 2004;
• a person working under a Canadian International Development Agency (CIDA) assistance program, if you were a resident of Canada at any time during the three-month period just before you began your duties abroad;
• a person who, under a tax treaty or another agreement or convention, is exempt from tax on 90% or more of your income from all sources in your new country of residence because of your relationship to a resident (including a deemed resident) of Canada; or
• a dependent child of one of the first four persons described above and your net income in 2004 was not more than $8,012.

Note
If you lived with and were the spouse or common-law partner of one of the first four persons described above at any time during 2004, and you ceased to be a resident of Canada before February 24, 1998, you are a deemed resident unless you choose not to be. For details, contact the International Tax Services Office.

What income should you report? - Report your 2004 world income. World income is income from all sources both inside and outside Canada.

Were you a member of the overseas Canadian Forces school staff who left Canada in 2004?

If so, and you severed your residential ties, you became a non-resident of Canada. If this is your situation, you should use the 2004 tax package for the province or territory where you lived just before you left Canada. You should also get the guide T4056, Emigrants and Income Tax , for the special rules that apply to you.

However, you can file as a deemed resident of Canada while you are serving abroad. If you make this choice, you should use the 2004 tax package for the province or territory where you lived just before you left Canada. In future years, you will use the tax package for non-residents and deemed residents of Canada.

Did you live in Quebec just before you left Canada?

Even though we may consider you to be a deemed resident of Canada, under Quebec law you may also be considered a deemed resident of that province. If this is the case, you may have to pay Quebec income tax while you are serving abroad.

To avoid double taxation (surtax for non-residents and deemed residents of Canada plus Quebec income tax), attach a note to your return telling us that you are filing a Quebec provincial return, and that you are asking for relief from the non-resident and deemed resident surtax.

Before you start

Do you have to file a return?

You have to file a return for 2004 if any of the following applies:

• You have to pay tax for 2004.
• We sent you a request to file a return.
• You were a deemed resident of Canada at any time in the year and you disposed of property in 2004 (for example, if you sold real estate or shares) or you realized a taxable capital gain (for example, if a mutual fund or trust attributed amounts to you, or you are reporting a capital gains reserve you claimed on your 2003 return).
• You were a non-resident of Canada throughout 2004 and you disposed of taxable Canadian property in 2004.
• You have to repay any of your Old Age Security or Employment Insurance benefits. See line 235 for details. If you were a non-resident in 2004, you will use the T1136, Old Age Security Return of Income, to pay back all or part of your Old Age Security.
• You have not repaid all of the amounts you withdrew from your registered retirement savings plan (RRSP) under the Home Buyers' Plan or the Lifelong Learning Plan. For details, see guide RC4135, Home Buyers' Plan (HBP) , or guide RC4112, Lifelong Learning Plan (LLP) .
• You have to contribute to the Canada Pension Plan (CPP). This can apply if, for 2004, the total of your net self-employment income and pensionable employment income is more than $3,500. See line 222 for details.
• You filed Form NR5, Application by a Non-Resident of Canada for a Reduction in the Amount of Non-Resident Tax Required to Be Withheld , for 2004 and we approved it. If this is your situation, you have to file a return electing under section 217 of the Income Tax Act.
• You filed Form NR6, Undertaking to File an Income Tax Return by a Non-Resident Receiving Rent From Real Property or Receiving a Timber Royalty , for 2004 and we approved it. If this is your situation, you have to file a return electing under section 216 of the Income Tax Act.
• You filed the Application by a non-resident of Canada (individual) for a reduction in the amount of non-resident tax required to be withheld on income earned from acting in a film or video production for 2004 and we approved it. If this is your situation, you have to file a return electing under section 216.1 of the Income Tax Act.

Even if none of these requirements applies, you still may want to file a return if any of the following applies:

• You want to claim a refund.
• You want to apply for the GST/HST credit. For example, you may be eligible if you turn 19 before April 2006.
• You or your spouse or common-law partner wants to begin or continue receiving Canada Child Tax Benefit payments.
• You have incurred a non-capital loss (see line 236) in 2004 that you want to be able to apply in other years.
• You want to carry forward the unused portion of your tuition and education amounts (see line 323).
• You want to report income for which you could contribute to an RRSP, in order to keep your RRSP deduction limit for future years up to date.

What date is your return for 2004 due?

Generally, your return for 2004 has to be filed on or before April 30, 2005.

Note
If you file your return after April 30, 2005, your GST/HST credit, Canada Child Tax Benefit (including those from certain related provincial or territorial programs), and Old Age Security benefit payments may be delayed.

Self-employed persons - If you or your spouse or common-law partner carried on a business in 2004 (other than a business whose expenditures are primarily in connection with a tax shelter), your return for 2004 has to be filed on or before June 15, 2005. However, if you have a balance owing for 2004, you still have to pay it on or before April 30, 2005. For details of how to make your payment, see line 485.

Non-residents electing under section 217 - For information on when your section 217 return for 2004 is due, see "When is your section 217 return due?"

Non-residents electing under section 216.1 - For information on when your section 216.1 return for 2004 is due, see "When is your section 216.1 return due?"

Deceased persons

If you are the legal representative (the executor, administrator, or liquidator) of the estate of an individual who died in 2004, you may have to file a return for 2004 for that individual. Get guide T4011, Preparing Returns for Deceased Persons , for details about your filing requirements and options.

Note
If you received income in 2004 for a person who died in 2003 or earlier, do not file a return for 2004 for that income on behalf of that person. However, you may have to file a T3 Trust Income Tax and Information Return for the estate.

What penalties and interest do we charge?

Penalties

If you owe tax for 2004, and do not file your return for 2004 within the dates we specify under "What date is your return for 2004 due?" in the previous section, we will charge you a late-filing penalty. The penalty is 5% of your 2004 balance owing, plus 1% of your balance owing for each full month that your return is late, to a maximum of 12 months. Your late-filing penalty may be higher if we charged you a late-filing penalty on a return for any of the three previous years.

Tax Tip
Even if you cannot pay the full amount you owe on or before April 30, 2005, you can avoid the late-filing penalty by filing your return on time.

We may waive this penalty (as well as any interest that may apply; see the next section) if you file your return late because of circumstances beyond your control. If this happens, include a letter with your return (or send one to us separately) giving the reasons why you filed your return late. For details, get Information Circular 92-2, Guidelines for the Cancellation and Waiver of Interest and Penalties .

Previously you could request to cancel or waive penalties for 1985 and subsequent tax years. Under proposed legislation, this period will be changed after December 31, 2004. Any request you make after that date will only be considered if it relates to any of the 10 years before the year in which you make it. For example, in 2005, you can make a request for any year back to 1995.

You may have to pay a penalty for any amounts you fail to report on your return for 2004. If you also failed to report an amount on your return for 2001, 2002, or 2003, you may have to pay another penalty. However, if you tell us about an amount you failed to report, we may waive these penalties. See "What is a voluntary disclosure?"

Non-residents electing under section 217 - If you file your 2004 section 217 return after June 30, 2005, your election is not valid. If the correct amount of non-resident tax was not withheld, we will send you a non-resident tax assessment.

Non-residents electing under section 216.1 - If you file your 2004 section 216.1 return after the due date, your election is not valid. The 23% non-resident withholding tax will be considered the final tax liability.

Interest

If you have a balance owing for 2004, we charge compound daily interest starting May 1, 2005, on any unpaid amounts owing for 2004. This includes any balance owing if we reassess your return. In addition, we will charge you interest on the penalties indicated in the previous section, starting the day after your return is due.

Social insurance number (SIN)

Your SIN is used under certain federal programs. You have to give it to anyone who prepares an information slip (such as a T3, T4, or T5 slip) for you. Each time you do not give it when you are supposed to, you may have to pay a $100 penalty. You also have to give it to us when you ask us for personal tax information. Check your slips. If your SIN is missing or is incorrect, advise the slip preparer.

If you have requested, but not yet received a SIN or cannot get a SIN, and the filing deadline is near, file your return without your SIN to avoid the late-filing penalty and interest charges. Attach a note to your return to let us know. We will assign you a temporary taxation number. Please keep a record of that number in case we need to contact you.

Your SIN card is not a piece of identification, and it should be kept in a safe place. For more information, or to get an application for a SIN, contact Social Development Canada or visit their Website at www.sdc.gc.ca. You can also contact Human Resources and Skills Development or visit their Website at www.hrsdc.gc.ca. You will find the addresses and telephone numbers of their offices on the Web pages mentioned above or in the government section of your telephone book.

If you are outside Canada, you can write to: Social Insurance Registration, P.O. Box 7000, Bathurst NB E2A 4T1, CANADA, or call (506) 548-7961.

Canada Child Tax Benefit (CCTB) and Child Disability Benefit (CDB)

If you are a deemed resident or if you are the spouse or common-law partner of a deemed resident, and you are responsible for the care of a child who is under 18, you can apply for the CCTB for that child. To do so, submit a completed Form RC66, Canada Child Tax Benefit Application , along with any other documents required, as soon as possible after the child is born or begins to live with you. If you are a permanent resident, temporary resident, or protected person (refugee) as defined in the Immigration and Refugee Protection Act, you should apply as soon as possible after you and your child arrive in Canada.

In addition to the CCTB, you can also receive a CDB if your child meets the criteria for the disability amount and we have approved Form T2201, Disability Tax Credit Certificate for the child.

The CCTB and CDB are based on the net income (line 236) shown on your return and, if applicable, your spouse or common-law partner's return. Therefore, to qualify for these benefits, you both have to file a return every year, even if there is no income to report.

However, if you are the non-resident spouse or common-law partner of a deemed resident, you will have to file Form CTB9, Canada Child Tax Benefit - Statement of Income , instead of filing a return for purposes of the CCTB.

Once you have applied for these benefits, you have to advise us immediately of any of the following changes (as well as the date it happened or will happen):

• the child is no longer in your care, stops living with you, or dies;
• you move (or your payments may stop, whether you receive them by direct deposit or by cheque);
• your marital status changes (but if you separate due to a breakdown in your relationship, wait until you are separated for at least 90 days before submitting Form RC65, Marital Status Change );
• you receive your payments by direct deposit and your banking information changes; or
• your or your spouse or common-law partner's immigration or residency status changes.

For more information, get pamphlet T4114, Your Canada Child Tax Benefit , or call us at 1-800-387-1193. If you are outside of Canada, call the International Tax Services Office.

Is this tax and benefit package for you?

Use this package if any of the following applies to you:

• You were a deemed resident of Canada on December 31, 2004. For exceptions, see the following section "What if this tax and benefit package is not for you?"
• You were a non-resident of Canada throughout 2004 and you are filing a return to elect under section 217.
• You were a non-resident of Canada throughout 2004 and you are reporting Canadian-source income other than from employment in Canada, from a business with a permanent establishment in Canada, from rental income from real property located in Canada, or from timber royalties on a timber resource property or a timber limit in Canada.

What if this tax and benefit package is not for you?

• If you were a deemed resident on December 31, 2004, and you are reporting only income from a business with a permanent establishment in a province or territory of Canada, use the package for that province or territory.
• If you were a deemed resident and you returned to Canada to live in 2004, use the package for the province or territory where you lived on December 31, 2004.
• If you were a non-resident throughout 2004 and you are reporting only income from employment in Canada, or from a business with a permanent establishment in Canada, use the package for the province or territory where you earned the income. You should also get guide T4058, Non-Residents and Income Tax , for the special rules that apply.

If you are also reporting other types of Canadian-source income (such as scholarships, fellowships, bursaries, research grants, or capital gains from disposing of taxable Canadian property), you will need Form T2203, Provincial and Territorial Taxes for 2004 - Multiple Jurisdictions , to calculate your tax payable.

• If you were a non-resident during 2004 and you received rental income from real property located in Canada or timber royalties on a timber resource property or a timber limit in Canada, and you are filing a return only to pay tax on this income using an alternative taxing method, use guide T4144, Income Tax Guide for Electing Under Section 216 .
• If you resided outside Canada on December 31, 2004, but you maintained residential ties in Canada, generally we consider you to be a factual resident of Canada. Use the package for the province or territory where you kept your residential ties. However, this may not apply if you were a factual resident who, under a tax treaty, is considered to be a resident of another country. For details, see the section called "Were you a deemed non-resident in 2004?"
• If you were a newcomer to Canada in 2004, use the package for the province or territory where you resided on December 31, 2004. You should also get pamphlet T4055, Newcomers to Canada , for the special rules that apply.
• If you emigrated from Canada during 2004, use the package for the province or territory where you resided on the day you left Canada. You should also get guide T4056, Emigrants and Income Tax , for the special rules that apply.

How can you get the tax and benefit package you need?

You should have received the package you need based on our records. However, if, after reading the above information, you cannot use this package, see "Publications" to find out how you can get the one you need.

Regardless of which tax package you use, send your return to the International Tax Services Office. Use the envelope included in this guide. If you provide services in the film and television industry, send your income tax return to the Film Services Unit that serves the province or territory where the services were rendered.

Getting started

Gather all the documents needed to complete your return. This includes your information slips (such as T3, T4, T4A, and T5 slips) and receipts for any deductions or credits you plan to claim. As you complete your return, when you come to a line that applies to you, you can look it up in this guide, or see the back of your information slips for more instructions. For more information, see "What do you include with your return and what records do you keep?"

Mail or deliver your return in the envelope included in this guide. Use your mail-in label if you have one, and make note of the address for future reference. If you are preparing other people's returns, mail or deliver each person's return in a separate envelope. However, if you are filing returns for more than one year for the same person, put them all in one envelope.

Note
If you have a farming business and you are participating in the Canadian Agricultural Income Stabilization Program (CAIS Program), use the envelope contained in guide RC4060, Farming Income and CAIS Program .

What do you include with your return and what records do you keep?

If you are filing a return, include one copy of each of your information slips. Make sure you attach to your return your Schedule 1. The explanations in the guide and the return, schedules, or forms will tell you when to attach other supporting documents, such as certificates, forms, schedules, or official receipts.

If a tax professional will be preparing or sending us your return, show him or her your label sheet and all of your supporting documents, such as your information slips, receipts, Notice of Assessment from last year, and instalment payments summary (on Form INNS1 or Form INNS2).

If you make a claim without the required receipt, certificate, schedule, or form, we may disallow your claim. It could also delay the processing of your return.

Even if you do not have to attach certain supporting documents to your return, keep them in case we select your return for review. You should keep your supporting documents for six years.

You should also keep a copy of your return for 2004, the related Notice of Assessment, and any Notice of Reassessment. These can help you complete your return for 2005. For example, your notice for 2004 will tell you:

• your RRSP deduction limit for 2005;
• your unused RRSP contributions for 2005;
• your capital and non-capital loss balances; and
• your tuition and education amounts carry-forward balance (see line 323).

Non-residents and non-residents electing under section 217 - You also need to include a completed Schedule A, Statement of World Income and Schedule B, Allowable Amount of Non-Refundable Tax Credits. If you are filing under section 217, you also need to include Schedule C, Electing Under Section 217 of the Income Tax Act. You will find these schedules in the centre of this guide.

What if you are missing information?

If you have to file a return for 2004, as explained in the section "Do you have to file a return?", make sure you file it on time even if some slips or receipts are missing. If you know that you will not be able to get a slip by the due date, attach to your return a note stating the payer's name and address, the type of income involved, and what you are doing to get the slip. To calculate the income to report, and any related deductions and credits you can claim, use any stubs you may have and attach them to your return.

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