Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
September 20, 1973
National Revenue, Customs & Excise has forwarded a copy of your letter of July 31 to us in order that we may reply directly to you in respect of your questions concerning your status for Canadian income tax purposes for the period that you are teaching in Australia.
As you know, Canada and Australia have entered into a tax treaty, the "Canada - Australia Income Tax Agreement", the purpose of which is to prevent double taxation of the same income of persons who may become subject to income taxes under the laws of both countries. Article XI of the Agreement deals, with the status for tax purposes of persons from one state who are temporarily present in the other state for the purpose of teaching. The import of this Article is that a resident of Canada will be exempt from Australian income taxes on his teaching income if he is present in Australia for the purpose of teaching for a period not exceeding two years. The question of whether a person is a resident of Canada is one of fact that must be decided by giving consideration to the particular circumstances of each case. Generally, a person will be considered to be resident in Canada if he maintains a place of residence during this temporary absence, such as an apartment, house or other living accommodation and this residence is, kept available for immediate occupancy or occupancy at abort notice.
Although you do not give sufficient detail in your letter to determine for certain your residential status for Canadian income tax purposes, from the information you do give it would appear that you would probably not be considered to be a resident of Canada during the period you are teaching in Australia. Accordingly, you would not be subject to Canadian income taxes regardless of the date you decide to return to Canada. You will, however, become subject to Ca.adian income tax on any earnings or remuneration that you receive from the date of becoming a resident of Canada upon your return.
Since you do not apparently qualify as a resident of Canada (and if you did, you would be subject to Canadian income taxes on your teaching income in Australia and accordingly exempt from Australian income taxes) your decision to stop teaching in Australia will have no bearing on your liability for Canadian income taxes. If you return to Canada in September, 1974 you Mill be subject to Canadian income taxes from that date forward.
We trust this answers your questions in this regards however, if we can be of any further assistance, please do not hesitate to write.
Yours sincerely,
Original Signed by
C.W. Mavor Director Provincial and International Relations Division
WSH/mls AIRMAIL
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