Before you start

Do you have to file a return?

You have to file a 1999 return if any of the following applies:

• You have a balance owing for 1999.
• We sent you a request to file a return.
• You were a deemed resident of Canada at any time in 1999 and you have a taxable capital gain or disposed of capital property (such as real estate or shares) in 1999, or you claimed a capital gains reserve on your 1998 return.
• You were a non-resident of Canada throughout 1999 and you have a taxable capital gain or disposed of taxable Canadian property in 1999.
• You have to pay back any of your Old Age Security or Employment Insurance benefits. See line 235 for details. If you were a non-resident in 1999, you will use the 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 RRSP under the Home Buyers' Plan or the Lifelong Learning Plan. For details, see the guide called Home Buyers' Plan (HBP) or the guide called Lifelong Learning Plan (LLP).
• You have to contribute to the Canada Pension Plan (CPP). This can apply if the total of your 1999 net self-employment income and pensionable employment income is more than $3,500. See line 310 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 1999 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 1999. If this is your situation, you have to file a return electing under section 216 of the Income Tax Act.

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

• You want to claim a refund.
• You want to apply for the goods and services tax/harmonized sales tax (GST/HST) credit (see page 14).
• You or your spouse wants to continue receiving Canada Child Tax Benefit payments (see the section called "Canada Child Tax Benefit" on page 12).
• You want to carry forward the unused portion of your tuition and education amounts (see line 323).
• You received income for which you could contribute to a registered retirement savings plan (RRSP). To keep your RRSP deduction limit (see page 29) up to date, you would have to file a return.

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 (as defined on page 9) during 1999. For exceptions, see the following section "What if this tax and benefit package is not for you?"
• You were a non-resident for all of 1999 and you are filing a return to elect under section 217 of the Income Tax Act (as defined on page 9).
• You were a non-resident (as defined on page 9) for all of 1999, and you are reporting Canadian-source income other than from employment in Canada or from a business with a permanent establishment in Canada (and you are not electing under section 217).

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

• If you were a deemed resident in 1999 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 during 1999, use the package for the province or territory where you lived on December 31, 1999.
• If you were a non-resident for all of 1999 and you are reporting income from employment in Canada, or from a business with a permanent establishment in Canada (and you are not electing under section 217), use the package for the province or territory where you earned the income. You should also get the guide called Non-Residents and Income Tax for the special rules that apply.
• If you were a non-resident during 1999 and you received Canadian-source rental income or timber royalties, and you are filing a return only to pay tax on this income using an alternate taxing method, use the package called Income Tax Guide for Electing Under Section 216.
• If you lived outside Canada during 1999, but you maintained residential ties (as defined on page 9) 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 to a factual resident who became a resident of another county after February 24, 1998. For details, contact the International Tax Services Office.
• If you were a newcomer to Canada in 1999, use the package for the province or territory where you lived on December 31, 1999. You should also get the pamphlet Newcomers to Canada for the special rules that apply.
• If you emigrated from Canada during 1999, use the package for the province or territory where you lived on the day you left Canada. You should also get the pamphlet called Emigrants and Income Tax for the special rules that apply.

Where 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, you can get the one you need from the International Tax Services Office. You will find the address and telephone numbers of the International Tax Services Office on the back cover of this guide.

Regardless of which tax package you use, send your return to the International Tax Services Office. Use the envelope included in this guide.

Determining yo ur residency status

Were you a non-r es id e nt in 1999?

You were a non-resident of Canada for tax purposes in 1999 if you did not have residential ties (as defined below) in Canada in 1999, and:

• you lived outside Canada throughout 1999 (except if you were a deemed resident as defined on this page); or
• you stayed in Canada for less than 183 days in 1999.

Note
If you were a resident (including a deemed resident) of Canada in 1999 but, under a tax treaty, you were considered a resident of another country, we may consider you to have been a non-resident of Canada for tax purposes in 1999. If this is your situation, contact the International Tax Services Office for the special rules (including the way you complete your return) that may apply to you.

What income should you report? - Report your 1999 income from Canadian sources such as scholarships, fellowships, bursaries, net research grants, income from a business without a permanent establishment in Canada, and taxable capital gains from disposing of taxable Canadian property. Do not include any gain or loss from disposing of taxable Canadian property, if, under a tax treaty, the gain from that disposition would be exempt from tax in Canada. See line 127 for more information.

If you received Canadian-source employment income or income from a business with a permanent establishment in Canada, you should use the tax package for the province or territory where you earned the income.

What are residenti al ties?

Residential ties include a home in Canada, a spouse or dependants who stayed in Canada while you were living outside Canada, and personal property in Canada. Other ties that may be relevant include social ties in Canada, a Canadian driver's licence, Canadian bank accounts or credit cards, and provincial or territorial hospitalization insurance coverage. For more details, contact the International Tax Services Office.

Were you a non-resident in 1999 and you want to elect un der 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 page 56.

Were you a d eeme d re sident in 1999?

You were a deemed resident of Canada for tax purposes in 1999 if you did not have residential ties in Canada, but you stayed here for 183 days or more in 1999 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 1999, you did not have residential ties in Canada, and you were:

• a member of the Canadian Forces at any time in 1999;
• 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 1999, see "Were you a member of the overseas Canadian Forces school staff who left Canada in 1999?" on page 10);
• a federal or provincial government employee and you either lived in Canada just before being posted abroad or you received a representation allowance for 1999;
• 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, is exempt from tax 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 1999 was, under proposed changes, less than $7,294.

Note
If you lived with and were the spouse of one of the first four persons described above at any time during 1999, 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 1999 world income. World income is income from all sources both inside and outside Canada.

Were you a member of the overseas Canadian Forces school s taff who left Canada in 1999?

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

However, if you wish, you can file as a deemed resident of Canada while you are serving abroad. If you make this choice, you should use the 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?

If so, 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 (federal non-resident and deemed resident surtax 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 federal non-resident and deemed resident surtax.

Filing your return

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 prepare 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.

Mail or deliver your return in the envelope included in this guide. Use your mail-in label if you have one. If you are preparing other people's returns, mail or deliver each person's return in a separate envelope.

Note
If you have a farming business and you are participating in the net income stabilization account (NISA) program, use the envelope contained in the guide called Farming Income and NISA.

What date is your 1999 return due?

Generally, your 1999 return has to be filed on or before April 30, 2000.

Note
If you file your return after April 30, 2000, your goods and services tax/harmonized sales tax (GST/HST) credit and Canada Child Tax Benefit payments may be delayed.

Self-employed persons - If you or your spouse carried on a business in 1999 (other than a business whose expenditures are primarily in connection with a tax shelter) your 1999 return has to be filed on or before June 15, 2000. However, if you have a balance owing for 1999, you still have to pay it on or before April 30, 2000. Send your payment to the International Tax Services Office with a note explaining how the payment is to be applied. Do not attach a copy of your return to your payment, unless you are filing that return.

Non-residents electing under section 217 - Your 1999 section 217 return is due on or before June 30, 2000. However, if you have a balance owing, you have to pay it by April 30, 2000.

Deceased persons - As the legal representative (executor or administrator) of the estate of an individual who died in 1999 or before May 1, 2000 (June 16, 2000, for a self-employed individual or that individual's spouse) you may have to file a 1999 return for that individual (see "Do you have to file a return?" on page 7). If so, the 1999 return for the deceased individual (and for the individual's spouse) has to be filed on or before whichever of the following two dates is later:

• April 30, 2000, for most individuals (June 15, 2000, for a self-employed individual or the individual's spouse); or
• six months after the individual's date of death.

For details about your filing requirements and options, get the guide called Preparing Returns for Deceased Persons.

Note
If you received income in 1999 for a person who died in 1998 or earlier, do not file a 1999 return 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 1999, and do not file your 1999 return within the dates we specify under "What date is your 1999 return due?" on this page, we will charge you a late-filing penalty. The penalty is 5% of your balance owing for 1999, 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, 2000, 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, as discussed in the next section) if you file your return late because of circumstances beyond your control. If this happens, include a letter with your return 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.

If you fail to report an amount on your return, you may have to pay a penalty. If you do this more than once within a four-year period, you may have to pay another penalty.

Non-residents electing under section 217 - If you file your 1999 section 217 return after June 30, 2000, your election is not valid.

Interest

If you have a balance owing for 1999, we charge compound daily interest starting May 1, 2000, on any unpaid taxes owing for 1999. This includes any balance owing if we reassess your return. In addition, we will charge you interest on any penalty you have to pay, starting the day after your return is due.

When will we pay interest?

We will pay you compound daily interest on your 1999 tax refund, starting on whichever of the following three dates is latest:

• June 15, 2000;
• the 46th day after you file your return; or
• the day after you overpaid your taxes.

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

Include one copy of each of your information slips. Your return, the guide explanations, the forms, or the schedules will tell you when to attach other supporting documents, such as certificates, forms, schedules, or official receipts.

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. Generally, you should keep your supporting documents for six years.

You should also keep a copy of your 1999 return, the related Notice of Assessment, and any Notice of Reassessment. These can help you complete your 2000 return. For example, your notice for 1999 will tell you:

• your 2000 RRSP deduction limit;
• your unused RRSP contributions for 2000;
• your non-capital loss carry-forward balance; and
• your tuition and education amounts carry-forward balance. For details, 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. You will find Schedule A in the centre of this guide.

What if you are missing information?

If you have to file a 1999 return, as explained on page 7, be sure to file it on time (see page 10) 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 which slips are missing, the payer's name and address, and what you are doing to get the slips. 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.

Canada Child Tax Benef it (CCTB)

If you are a deemed resident or if you are the spouse 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 schedules and documents required, as soon as possible after the child is born or begins to live with you.

The CCTB is based on the income shown on your return and your spouse's return. Therefore, to qualify for the benefit, 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 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 Canada Child Tax Benefit.

Once you have applied for the CCTB, 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 be interrupted);
• your marital status changes;
• you have your payments deposited directly into your account at a financial institution (see "Direct deposit" on page 55) and your banking information changes; or
• you or your spouse is no longer a deemed resident of Canada.

For more information about the CCTB, get the pamphlet called Your Canada Child Tax Benefit, or call us at 1-800-387-1193.

After you file

When can you expect your refund?

We usually process returns in four to six weeks. However, we start to process returns in mid-February, so do not call before March 1, even if you filed your return in January. If you filed your return on or before April 15, wait four weeks before you call. If you filed your return after April 15, wait six weeks before you call.

What happens to your return after we receive it?

When we receive your return, we usually review it based on the information you provided, and send you a Notice of Assessment based on that review. However, we may select your return for a more detailed review before we assess it. If so, and we ask you to give us documents to verify the deductions or credits you claimed, your assessment may be delayed. We also review some returns after we have assessed them, to verify the income reported, or the deductions or credits claimed.

How do you change a return?

If you need to make a change to any return you have sent us, do not file another return for that year. Instead, send both of the following to the International Tax Services Office:

• a completed Form T1-ADJ, T1 Adjustment Request, or a signed letter providing the details of your request (including the years of the returns you want us to change), your social insurance number or temporary taxation number, your address, and a telephone number where we can reach you during the day; and
• supporting documents for the changes you want to make and, if you have not sent them to us before, supporting documents for your original claim.

Note
Send your Form T1-ADJ or letter separately from your 1999 return.

You can ask for a refund for years as far back as 1985. It usually takes eight weeks before we complete the adjustment and mail you a Notice of Reassessment.

Can you file a return to claim a refund for a previous year?

If you have not already filed one, you can file a return (other than to make an election under section 217) to claim a refund for 1985 or any year after that. If you are filing a return for a year before 1999, make sure you attach receipts for all the deductions or credits you are claiming.

What is a voluntary disclosure?

If you have never filed a return, stopped filing returns for two or more years, or sent us a return that was incomplete, we encourage you to voluntarily file or correct your return. We will then assess or reassess your return without applying a penalty. You will only have to pay the tax you owe, with interest. Information Circular 85-1, Voluntary Disclosures, has more details.

What should you do if you disagree?

If you disagree with your assessment or reassessment, contact the International Tax Services Office for more information. If you still disagree, you can make a formal objection by sending us a completed Form T400A, Objection, or a letter on or before whichever of the following two dates is later:

• one year after the due date for the return; or
• 90 days after the date of the Notice of Assessment or Notice of Reassessment.

What should you do if you move?

If you move, let us know your new address as soon as possible. This will ensure that you keep getting any goods and services tax/harmonized sales tax (GST/HST) credit or Canada Child Tax Benefit (and similar provincial or territorial program) payments to which you may be entitled. If you use direct deposit, and your account at your financial institution has changed, be sure to advise us of your new account. We also need to know your new address to mail you your return package for next year.

You can change your address by calling, writing, or visiting us. If you are writing, send your letter to the International Tax Services Office. Make sure you sign the letter, and include your social insurance number (SIN) or temporary taxation number (TTN), your new address, and the date of your move. If you are writing for other people, include their SINs or TTNs, and have each of them sign the letter authorizing the change to his or her records.

Note
Because an individual's personal information is confidential, generally we will not provide a change of address to other government departments or Crown corporations, such as Human Resources Development Canada or Canada Post. Similarly, they do not provide such information to us.

Should you be paying your taxes by instalments?

You may have to pay your taxes by instalments if there is not enough income tax withheld from your income. To find out if you have to pay your taxes for 2000 by instalments, estimate your taxes and credits for 2000 using your 1999 return. Enter those amounts in the chart on the Worksheet you will find in the centre of this guide. The chart contains the most common factors to consider. To find out all of the factors, or to calculate your payments, get Form T1033-WS, Worksheet for Calculating 2000 Instalment Payments.

If our records show that you may have to pay your taxes by instalments, we will send you an Instalment Reminder in advance, showing the amount we suggest you pay and the date the payment is due. For more information about instalment payments, or instalment interest charges, get the pamphlet called Paying Your Income Tax by Instalments.

Iden tification

Follow the instructions on the return to complete each item in this area. Providing incomplete or incorrect information may delay the processing of your return, and any refund, credit, or benefit, such as any Goods and services tax/harmonized sales tax (GST/HST) credit and Canada Child Tax Benefit payments to which you may be entitled.

Non-residents electing under section 217 - At the top of page 1 of your return, write "Section 217."

Personal label

If you have a personal label, attach it to your return. If your name, your address, your social insurance number (SIN) or temporary taxation number (TTN), or your spouse's SIN or TTN is incorrect, put a line through the wrong information, and print your changes clearly on the label.

We may modify part of your address to meet Canada Post's requirements. Therefore, the address on your package, your Notice of Assessment, or other correspondence we send you may be different from the one you indicate on your return.

Marital status

Check the box that applies to your status for income tax purposes on December 31, 1999. Check either "Married" or "Living common law" (whichever applies) if you had a spouse who meets the definition below. Check one of the other boxes only if the first two categories do not apply.

Spouse

For tax purposes, you have a spouse when you are legally married, or living common law with someone (see below). You still have a spouse if you are living apart for reasons other than a breakdown in your relationship.

Living common law - This applies when you live and have a relationship with a person of the opposite sex to whom any of the following applies. He or she:

• is the natural or adoptive parent (legal or in fact) of your child;
• has been living common law with you for at least 12 continuous months; or
• lived with you previously as your spouse for at least 12 continuous months.

The above includes any period that you were separated for less than 90 days because of a breakdown in the relationship.

Province or territory of residence

Enter "other" on this line.

Self-employed

If you were either a deemed resident of Canada or a non-resident electing under section 217, and you were self-employed in 1999, enter the province or territory where you had a permanent business establishment.

Elections Canada

If you are a deemed resident of Canada, please answer the question, on page 1 of your return, about providing certain information to Elections Canada. For more information, see page 4 of this guide.

Goods and s ervices tax/harmonized sales tax (GST/HST) credit application

You can receive the GST/HST credit only if you apply for it each year, even if you received it in the previous year. To apply, you have to complete this area on page 1 of your 1999 return. Your credit is based on the information provided on your return and, if applicable, your spouse's return (see the definition of "spouse" on this page).

If you qualify, you will receive payments in July and October of 2000, and January and April of 2001. However, if your total credit for the year is less than $100, we will pay all of it in July of 2000. If you apply, we will let you know in July of 2000 the amount to which you are entitled, if any, and how we calculated your credit. If you move, tell us, or your payments may be interrupted.

Note
If you have a spouse, only one of you can receive the credit. No matter which one of you applies, the credit will be the same.

Who can apply?

You can apply for the GST/HST credit if, at the end of 1999, you were a deemed resident of Canada and any of the following applies. You:

• were 19 years of age or older;
• had a spouse; or
• were a parent.

You cannot apply if, at the end of 1999, you:

• were a non-resident of Canada;
• were confined to a prison or a similar institution, and had been there for more than six months during 1999; or
• did not have to pay tax in Canada because you were an officer or servant of another country, such as a diplomat, or a family member or employee of such a person.

Note
You cannot claim the credit for your spouse or child who met either of the last two conditions at the end of 1999.

Number of children

You can claim a GST/HST credit for each of your children to whom all of the following apply. At the end of 1999, he or she:

• was under 19 years of age;
• did not have a spouse;
• was not a parent; and
• either lived with you, or was claimed as a dependant by either you or your spouse.

Only one person can claim a GST/HST credit for a particular child.

Net income of spouse

Your spouse's net income is the amount on line 236 of your spouse's return, or the amount that it would be if your spouse filed a return.

Income limit

In the following chart, look up the number of children you have. If your net family income is equal to, or less than, the amount shown across from the number of your children, you may be entitled to receive the credit. Your net family income is the total of your net income and, if applicable, your spouse's net income.

Number of children	Maximum family income
0	$33,880
1	$35,980
2	$38,080
3	$40,180
4	$42,280
5 or more	apply

Note
These income limits are only guidelines to help you decide if you should apply for the credit. If you apply, we will send you a notice by the end of July 2000 to let you know the amount to which you are entitled, if any.

Calculating your GST/HST credit

To find out how to calculate your GST/HST credit, call the International Tax Services Office. We may apply your GST/HST credit against certain outstanding federal, provincial, or territorial government debts, such as student loans, Employment Insurance and social assistance benefit overpayments, Immigration loans, and training allowance overpayments. We also may apply it to satisfy a garnishment order under the Family Orders and Agreements Enforcement Assistance Act.