Section 2

Subsection 2(1) - Tax payable by persons resident in Canada

Commentary

A person who is resident in Canada is subject to tax under Part I of the Act on its world-wide income (or, to be more precise, on its taxable...

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Cases

Landbouwbedrijf Backx B.V. v. Canada, 2019 FCA 310

When a Netherlands couple immigrated to Canada in 1998 to acquire a dairy farm here, they created a structure under which the farm was held in a...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 4 potential relief under Dutch Treaty needed to be addressed even for mooted dual resident who had not been agreed by competent authorities to be a Dutch resident 313
Tax Topics - Income Tax Act - Section 128.1 - Subsection 128.1(1) - Paragraph 128.1(1)(c) s. 128.1(1)(c) step-up turned upon becoming resident in Canada 368

Fundy Settlement v. Canada, 2012 DTC 5063 [at 6881], 2012 SCC 14, [2012] 1 S.C.R. 520, aff'g sub nom St. Michael Trust Corp. v. The Queen, 2010 DTC 5189 [at 7361], 2010 FCA 309, aff'g sub nom Garron v. The Queen, 2009 DTC 1568, 2009 TCC 450

The taxpayers were two Barbados trusts with Canadian beneficiaries. The trusts realized substantial capital gains on the sale of the shares of...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(1) trust residence that of Canadian beneficiaries 168

Nedelcu v. Canada, 2010 DTC 5102 [at 6942], 2010 FCA 156

The taxpayer, who had left Canada a number of years previously, was not resident in Canada and, therefore, was not eligible for child tax...

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Glow v. The Queen, 92 DTC 6467, [1992] 2 CTC 245 (FCTD)

A management consultant, who spent a year and a half in Nigeria before returning to work with his employer in Canada, was found to be resident in...

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Oceanspan Carriers Ltd. v. The Queen, 87 DTC 5102, [1987] 1 CTC 210 (FCA)

"When a non-resident corporation whose fiscal period has been the calendar year becomes a resident part way through that fiscal period, and does...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 111 - Subsection 111(1) - Paragraph 111(1)(a) 62
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Taxpayer "taxpayer" refers to a person who may become liable to tax 77

Capitol Life Insurance Co. v. The Queen, 84 DTC 6087, [1984] CTC 141 (FCTD), aff'd 86 DTC 6164, [1986] 1 CTC 388 (FCA)

"Both high level and immediate detailed control and management of the business [of the taxpayer insurance company] as well as all corporate...

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The Queen v. Sherwood, 78 DTC 6470, [1978] CTC 713 (FCTD)

The individual defendant, who spent much of the period from 1954-1958 in New York and, to a lesser extent, Europe, promoting stocks, was held to...

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Thibodeau Family Trust v. The Queen, 78 DTC 6376, [1978] CTC 539 (FCTD)

A trust whose deed of settlement permitted majority decisions, two of whose trustees were Bermuda residents, and whose res in the main was in...

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The Queen v. Reeder, 75 DTC 5160, [1975] CTC 256 (FCTD)

A Canadian employee of Michelin who was sent with his wife to France for six months for training was resident in Canada throughout that period....

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Thomson v. Minister of National Revenue, 2 DTC 812, [1946] S.C.R. 209

For a number of years the taxpayer spent between 81 and 159 days in Canada each year, with most of the balance spent in the United States. The...

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See Also

R & C Commrs v Development Securities plc & Ors, [2020] EWCA Civ 1705

A U.K. tax avoidance scheme entailed Jersey subsidiaries (formed only for the purpose of implementing the scheme) acquiring assets from their UK...

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Biya v. The Queen, 2020 TCC 113

The Appellant was born in Ethiopia in 1958, immigrated with his wife to Canada in 1981, became a Canadian citizen in 1985, obtained a B. Comm from...

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Sanctuary v. Agence du revenu du Québec, 2020 QCCQ 1903

The taxpayer, who was a full-time professor at McGill University in Montreal, purchased a home 90 km from Montreal in Lancaster, Ontario, which...

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Baril v. Agence du revenu du Québec, 2020 QCCQ 1466

In 2010, a corporation (“Garda”), which managed search points at several airports across the country, hired the taxpayer as the Vice President...

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Adou v. Agence du revenu du Québec, 2020 QCCQ 131

The taxpayer was assessed to deny credits that he had received for child care credits on the basis that he was not a resident of Quebec on...

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Holland v. Canada (Attorney General), 2019 FC 1433

The taxpayer, who left Canada in 2004 and returned in January 2010, filed a voluntary disclosure application in July 2015 covering the period from...

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Locations of other summaries Wordcount
Tax Topics - Other Legislation/Constitution - Federal - Federal Courts Act - Section 18.5 taxpayer could not challenge a CRA residency determination that had not yet been assessed in the context of a VDP application that had not yet been accepted or declined 313

Addy v Commissioner of Taxation, [2019] FCA 1768, reinstated by [2021] HCA 34 after being rev'd by [2020] FCAFC 135

The taxpayer, who was a British citizen aged 23 and had been residing at her family home in Bexleyheath, Kent, came to Australia on a “working...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 25 the imposition of flat tax on UK working-holiday visa holders contravened the Austr.-UK Treaty non-discrimination clause 483

Stockton v Commissioner of Taxation, [2019] FCA 1679

The taxpayer was a US citizen who, in her “gap year” after high school, came to Australia for the nine months from 1 September 2016 to 23 June...

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Development Securities PLC and Others v The Commissioners for HM Revenue and Customs, [2019] UKUT 169 (Tax and Chancery Chamber), rev'd [2020] EWCA Civ 1705

A U.K. tax avoidance scheme, entailed Jersey subsidiaries acquiring assets from their UK parent (DS Plc) or its U.K. subsidiaries at prices...

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Sampson v British Columbia, 2018 BCSC 1503

The taxpayer, described (at para. 126) as “a wealthy CEO of an international energy company,” maintained a 600 square foot apartment within...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Regulations - Regulation 2607 Calgary executive with a large B.C. home had his “principal place of residence” in B.C. 319

Fono v. Agence du revenu du Québec, 2018 QCCQ 10534

The taxpayer, who had become a resident of Quebec in 1995, got a job as an auditor in Ottawa in September 2007 and rented an apartment there,...

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Rousseau v. Agence du revenu du Québec, 2018 QCCQ 7340

The taxpayer, who had worked in Quebec until 1988 operating heavy machinery, moved to new employment in Fort McMurry in Alberta in 1999 while his...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 162 - Subsection 162(1) taxpayer established that failure to file Quebec returns was based on good faith reliance on his accountant’s view of his Alberta residency 149
Tax Topics - Income Tax Act - Section 152 - Subsection 152(4.2) Quebec Minister advised to take steps under intergovernmental agreement to avoid double taxation 238

Landbouwbedrijf Backx B.V. v. The Queen, 2018 TCC 142, confirmed on s. 2(1) grounds, remitted for reconsideration on s. 128.1(1)(c) and Treaty grounds 2019 FCA 310

A Netherlands couple (the “Backxes”) incorporated the taxpayer as a Netherlands limited liability company, but prior to their immigration to...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 128.1 - Subsection 128.1(1) - Paragraph 128.1(1)(c) no application of s. 128.1(1)(c) as central management and control had been in Canada from the time of the investment 284
Tax Topics - Treaties - Income Tax Conventions - Article 4 Netherlands corporation with central management and control in Canada was not resident in the Netherlands for Treaty purposes 443

895410 Alberta Ltd., fiduciaire de la Fiducie Haifa v. Agence du revenu du Québec, 2018 QCCQ 2581

The Haifa Trust was settled in 2000 by a tax advisor (Mr. Marcinski) to Mr. Zaffir, a Quebec resident. Its sole trustee was an Alberta corporation...

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Boettger v. Agence du revenu du Québec, 2017 QCCA 1670

An Alberta trust was found by the Court of Quebec below to be resident in Quebec. The settlor and beneficiary (his wife) were unfamiliar with the...

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Development Securities (No. 9) Ltd & Ors v HMRC, [2017] UKFTT 565 (TC), rev'd [2019] UKUT 169 but FTT decision confirmed at [2020] EWCA Civ 1705

The appellants (the “Jersey companies”) were incorporated in Jersey as subsidiaries of a U.K.-resident property development and investment...

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Robinson v. Agence du Revenu du Québec, 2016 QCCQ 11066

The taxpayer was born in Québec and worked and studied there until 2007, when she left to work in Alberta in thermal insulation systems. The...

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Bywater Investments Ltd. v Commissioner of Taxation; Hua Wang Bank Berhad v Commissioner of Taxation, [2016] HCA 45

All but one of the directors of three appellants were resident in Switzerland, with all the directors’ meeting being held in Switzerland. The...

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Herman Grad 2000 Family Trust v. Minister of Revenue, 2016 ONSC 2402

The first taxpayer was a discretionary family trust (the “Family Trust”) whose beneficiaries were the three daughters of Mr. Grad (“Grad”...

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Bywater Investments Ltd. v. Commissioner of Taxation, [2015] FCAFC 176, aff’g sub nom. Hua Wang Bank Berhad v. Commissioner of Taxation [2014] FCA 1392, aff'd [2016] HCA [austlii.edu.au]

Although the board meetings of the taxpayers were held outside Australia (in London, Switzerland or Samoa), the Court accepted that each...

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Boettger, trustee of Nancy Smith Spousal Trust v. ARC, 2015 QCCQ 7517, aff'd 2017 QCCA 1670

A Quebec-resident individual ("Gibeault"), who was the sole shareholder of a Quebec corporation ("Cetco"), exchanged a portion of his common...

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Discovery Trust v. MNR, 2015 CanLII 34016 (NL SCTD)

Charles Dobbin, the founder of CHC Helicopter Corporation ("CHC"), settled a trust, whose trustees and beneficiaries were his children. The trust...

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Bower v. The Queen, 2013 DTC 1152 [at 854], 2013 TCC 183 (Informal Procedure)

Bocock J found that the taxpayer was ineligible for the Canada child tax benefits as he was no longer a Canadian resident. He only visited Canada...

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Dysert v. The Queen, 2013 DTC 1070 [at 373], 2013 TCC 57

The taxpayers were middle-aged "all American" certified cost estimate professionals, with no significant previous exposure to Canada, who came to...

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Edwards v. The Queen, 2013 DTC 1025 [at 124], 2012 TCC 430 (Informal Procedure)

VA Miller J found that the taxpayer, who spent an equal amount of time in Canada and the UK, was a Canadian resident based on her personal ties to...

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Mullen v. The Queen, 2012 DTC 1154 [at 3358], 2012 TCC 139 (Informal Procedure)

The taxpayer was reassessed in respect of income from stock options exercised in 1997, 1999, and in 2001. He argued that he was not a Canadian...

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Daruwala v. The Queen, 2012 TCC 257 (Informal Procedure)

Woods J. stated (at paras. 25-26):

The term "residence" has a flexible meaning which is dependant on the context in which it is used. ...

The term...

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Locations of other summaries Wordcount
Tax Topics - Excise Tax Act - Section 191 - Subsection 191(1) informal arrangement included 168

Vegh v. The Queen, 2012 DTC 1131 [at 3160], 2012 TCC 95 (Informal Procedure)

Boyle J. found that the taxpayer ceased to be a Canadian resident in 2000 when he moved to China to teach English - a stay in which he met and...

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Snow v. The Queen, 2012 DTC 1116 [at 3087], 2012 TCC 78 (Informal Procedure)

Woods J. found that the taxpayer's stay in New Zealand, which she intend to be only transitory while her husband completed his master's degree,...

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Fatima v. The Queen, 2012 DTC 1087 [at 2923], 2012 TCC 49 (Informal Procedure)

The taxpayer moved to Canada in August 2005, joining her husband who had moved from Pakistan to Canada in 1997. In February 2006 she moved back...

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R (Davies) v. Revenue and Customs Commissioners, [2012] 1 All ER 1048, [2011] UKSC 47

The first group of taxpayers (Davies and others) were successful English property developers who decided to extend their property development...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 152 - Subsection 152(1) concessions for non-collection with overall revenue enhancement objective 221

Hamel v. The Queen, 2012 DTC 1004 [at 2518], 2011 TCC 357

Tardif J. found that the taxpayer ceased to be resident in Canada following his departure from Canada for Qatar in 2007. His Qatar work permit...

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Perlman v. The Queen, 2011 DTC 1045 [at 199], 2010 TCC 658

In determining whether the taxpayer was eligible for a Canada child tax benefit, Boyle J. found that the taxpayer was resident in Canada for the...

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Charafeddine v. The Queen, 2010 DTC 1281 [at 3953], 2010 TCC 417 (Informal Procedure)

The taxpayer's children were abducted by her husband in Lebannon, and were being held there while the taxpayer tried to effect their return to...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 122.6 - Eligible Individual children's being abducted and held in foreign country by estranged spouse did not disrupt CCTB eligibility 225

Bensouilah v. The Queen, 2010 DTC 1018 [at 2624], 2009 TCC 440 (Informal Procedure)

The taxpayer, who had been a resident of Canada for six years, moved to a job in Saudi Arabia for the three taxation years in question, with most...

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1143132 Ontario Limited v. The Queen, 2009 DTC 1312, 2009 TCC 477

The central management and control of a Barbados corporation was in Barbados rather than Canada, notwithstanding that its directors in Barbados...

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Lingle v. The Queen, 2009 DTC 1705, 2009 TCC 435, aff'd 2010 DTC 5100 [at 6932], 2010 FCA 152

The taxpayer, who was a U.S. citizen, was found to have a centre of vital interest in Canada rather than the United States given that it was...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 4 241

Minin v. The Queen, 2008 DTC 4463, 2008 TCC 429

The taxpayer, who was working on a succession of small jobs in the United States and whose children continued to live with his mother and his...

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Filipek v. The Queen, 2008 DTC 4139, 2008 TCC 351

The taxpayer, an Air Canada pilot who spent approximately two months a year in the Turks and Caicos primarily on recreation, and approximately 100...

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Mullen v. The Queen, 2008 DTC 3892, 2008 TCC 294 (Informal Procedure)

The taxpayer, who spent most of the taxation years in question in the Far East, was found nonetheless to be ordinarily resident in Canada in light...

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Johnson v. The Queen, 2007 DTC 1022, 2007 TCC 288

The taxpayer was ordinarily resident in Canada in the year within the meaning of s. 250(3) given that his Canadian employer was obligated to...

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Barton v. The Queen, 2007 DTC 712, 2007 TCC 222

The taxpayer was found to be resident in Canada for a four-year period during which he was working in the United States given that the evidence...

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Laurin v. The Queen, 2007 DTC 236, 2006 TCC 634

An Air Canada pilot who had shared accommodation with other pilots, and had financial investments in the Turks and Caicos Islands and a mailing...

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Hauser v. The Queen, 2005 DTC 1151, 2005 TCC 492, aff'd 2006 DTC 6447, 2006 FCA 216

An Air Canada pilot who took up residence in the Bahamas continued to be resident in Canada given that his work routine (which was centred on...

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Yoon v. The Queen, 2005 DTC 1109, 2005 TCC 366

The taxpayer was resident in South Korea rather than Canada in her 2001 taxation year. Although she had a residence in British Columbia available...

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Wood v. Holden (2005), 7 ITLR 725, [2005] EWHC 547 (Ch. D)

A corporation was found to be resident in the Netherlands, under the central management and control test, given that the only acts of management...

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Bujnowski v. The Queen, 2005 DTC 247, 2005 TCC 90 (Informal Procedure)

The taxpayer, who was a Canadian citizen with a Canadian passport, began working in the United States as a computer systems analyst on January 1,...

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Gaudreau v. The Queen, 2005 DTC 66, 2004 TCC 840, aff'd 2005 DTC 5702, 2005 FCA 388

The taxpayer, who left with his wife to work in Egypt for 48 months, while maintaining various ties including their home in Ontario while in...

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Snow v. The Queen, 2004 DTC 2784, 2004 TCC 381 (Informal Procedure)

After the taxpayer took an assignment (initially scheduled for two years) to work in Belize she maintained her home in Vancouver where her son and...

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Revah v. The Queen, 2004 DTC 2735, 2004 TCC 312

The taxpayer, who had moved with his wife to Florida in September 1992, had thereupon ceased to be a resident of Canada notwithstanding that he...

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Nicholson v. The Queen, 2004 DTC 2013, 2003 TCC 862

When the taxpayer moved from Canada to the United Kingdom following a promotion, the settled nature of his life was now there, notwithstanding...

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Allchin v. The Queen, 2003 DTC 935 (TCC)

The taxpayer, a registered nurse who previously had been a resident of Canada and who was employed in the taxation years in question in the U.S.,...

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Kadrie v. The Queen, 2001 DTC 967 (TCC)

The taxpayer was not ordinarily resident in Canada in the taxation years in question given that his family was in Canada only because his wife was...

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Bell v. Canada, 2000 DTC 6365, 2008 FCA 51 (FCA)

The central management and control of a company, for purposes of assessing the degree of connection of employment income and dividends generated...

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Shih v. The Queen, 2000 DTC 2072 (TCC)

The taxpayer, who was a pharmacist permanently employed in Taiwan, was found not to have become a resident of Canada notwithstanding that he had...

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Boston v. The Queen, 98 DTC 1124, [1998] 1 CTC 2217 (TCC)

The taxpayer, who was transferred by Exxon from Canada to Malaysia in 1988, and served (and lived in a rented house) there until his retirement in...

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Endres v. The Queen, 98 DTC 1101, [1998] 1 CTC 2259 (TCC)

In the summer of 1985, the taxpayer started spending significant time at Elizabeth City in North Carolina in order to manage one of his businesses...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 4 145

Fisher v. The Queen, 95 DTC 841 (TCC)

The taxpayer, who was actively involved in selling European art to Japanese clients and spent much of his time travelling between Europe and...

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Wassick v. MNR, 95 DTC 19, [1994] 2 CTC 2235 (TCC)

The taxpayer, who worked abroad (primarily in Scotland) as a deep-sea diver but who frequently returned to Canada where he had friends and...

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Re Koo, [1993] 1 F.C. 286, 1992 CanLII 2417 (T.D.)

In finding that the appellant, who was physically present in Canada for 232 days during the four-year period preceding his application for...

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Padmore v. IRC, [1989] BTC 221 (C.A.)

The taxpayer, who was resident in the U.K., was one of over 100 U.K. resident individuals (primarily members of firms of patent agents) who were...

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Dawson v. C.I.R., [1989] BTC 200, [1989] UKHL TC_62_301 (HL)

A trust, of which two of the three trustees were non-residents of the United Kingdom, was held not to be subject to tax under s. 108 of the Income...

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Reed v. Clark, [1985] BTC 224 (HC)

An English musician, who was advised to protract his intended visit to the U.S.A. to cover an entire fiscal year in order to avoid U.K. tax, and...

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Levene v. IRC, [1928] AC 217, [1928] All ER 746

Relying on the Oxford Dictionary's definition of "reside," Lord Chancellor Cave found that the taxpayer's place of residence is the place of the...

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Administrative Policy

17 May 2022 IFA Roundtable, Q.1

Before responding to a question as to how it applied the test of an in individual’s “habitual mode” under the “tie breaker” rules in...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 4 habitual abode determined in context based inter alia on relative stays and nature of activities 137

Guidance on international income tax issues raised by the COVID-19 crisis, CRA Webpage 31 March 2021

CRA referred to the travel restrictions imposed by governments or businesses in response to the COVID-19 crisis as a safety measure for their...

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28 September 2020 External T.I. 2019-0800551E5 - Provincial Residency of a TFSA Trust

The Alberta-resident holder of a TFSA is responsible for making investment decisions and determining contributions and withdrawals, and its...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Regulations - Regulation 2600 - Subsection 2600(2) office of investment manager of TFSA treated as a PE of the TFSA 343
Tax Topics - Income Tax Regulations - Regulation 2601 - Subsection 2601(2) office of investment manager was PE to which securities trading income of TFSA was allocated 202

2020 IFA-YIN Seminar on COVID-19 Guidelines, Q.9

The Guidance on international income tax issues raised by the COVID-19 crisis indicates that CRA will consider administrative relief for...

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2020 IFA-YIN Seminar on COVID-19 Guidelines, Q.1 and Q.2

In the context CRA's Guidance on international income tax issues raised by the COVID-19 crisis would recommendations without legal restrictions...

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11 October 2019 APFF Financial Strategies and Instruments Roundtable Q. 11, 2019-0812971C6 F

Some pension plans provide that after two years of non-residence of the annuitant, the funds in a locked-in retirement account, locked-in RRSP or...

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7 October 2011 Roundtable, 2011-0412221C6 F - Résidence fiducie - Cause St. Michael (Garron)

What mechanism is followed for determining the residence of a trust if two Canadian provinces are each of the opinion that the central management...

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22 March 2018 Internal T.I. 2018-0738201I7 - Residency of TFSA trust

A non-resident holder of a self-directed TFSA trust argued that as she made all the investment decisions, the trust was not resident in Canada. ...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 146.2 - Subsection 146.2(6) investment trading decisions by non-resident holder did not make the TFSA trust a non-resident 108

18 October 2016 External T.I. 2015-0608051E5 F - Emigration of a trust

CRA confirmed that s. 220(4.5) applies to a trust which has ceased to be resident in Canada. Before so concluding, it stated:

Recall that the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 220 - Subsection 220(4.5) emigrating trust can elect to defer payment of the exit tax 199

24 November 2015 CTF Annual Roundtable, Q.3

CRA's views regarding the application of the "central management and control" test in determining the residency of a trust for provincial tax...

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26 January 2015 External T.I. 2014-0547501E5 - Certificates of residency and partnerships

After noting its earlier position at 3 December 2013 TEI Roundtable Q. 9, 2013-0510851C6 that a certificate of residency was not available for a...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 102 - Subsection 102(1) certification of Canadian partnership at request of authorized representative 91

15 December 2014 Internal T.I. 2012-0445361I7 F - Remboursement de frais de déménagement

Before indicating that the question of whether the reimbursement of expenses of selling a residence at Location 1 in Canada, which had continued...

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Words and Phrases
ordinarily reside
Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) reimbursement of moving expenses not a taxable benefit if such moving expenses otherwise deductible under s. 62 which, in the case of multiple moves, can turn on whether there is ordinary residence at each location 436
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Eligible Relocation expenses re selling a Canadian home after a 2nd relocation abroad are non-deductible if no ordinary residence at 1st location abroad 263

S6-F1-C1 - Residence of a Trust or Estate

1.2 ...Fundy Settlement…clarified that residence of a trust will be determined by … where its real business is carried on, which is where the...

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3 December 2013 TEI Roundtable, 2013-0510851C6 - 2013 TEI – Question 9: Tax residency certificates.

Would CRA be willing to issue Canadian tax residency certificates in the name of a Canadian partnership on the basis of the Canadian residency of...

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11 July 2013 External T.I. 2013-0490591E5 F - Montant pour une personne à charge

A Taxpayer living in France (initially described as non-resident) frequently sees another person (the "Other Person") who lives the year half and...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 118 - Subsection 118(1) - Paragraph 118(1)(b) - Subparagraph 118(1)(b)(ii) conditions not satisfied where children did not live with non-supporting husband following separation 142
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Common-Law Partner can be in a conjugal relationship even if live in the same home for only half of each year 148

Certificate of residency

An individual, a corporation, a trust, a non-profit organization, or a charity can get a certificate of residency, as long as they are resident...

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17 October 2012 External T.I. 2012-0437691E5 - Factual Resident - Missionary

As stated in Pamphlet T4131 Canadian Residents Abroad, where an individual is a missionary in another country and meets certain requirements, the...

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5 October 2012 Roundtable, 2012-0451271C6 F - Residence of a trust

Following Fundy Settlement, what weight should be assigned to the following criteria in determining the residence of a trust that holds portfolio...

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S5-F1-C1 - Determining an Individual’s Residence Status

1.10 The most important factor to be considered in determining whether an individual leaving Canada remains resident in Canada for tax purposes...

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30 October 2012 Ontario CTF Roundtable Q. 8, 2012-0462841C6 - Ontario CTF – Q8 Residency of a Trust

In response to a query on the Fundy Settlement case, CRA stated:

Normally, residence of a trust is dependent upon residence of the trustee or...

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4 January 2013 External T.I. 2012-0448681E5 - s. 116 req. of NR-estates per draft NRT legis.

CRA, when asked whether a s. 116 certificate was required when an estate with American resident executors disposed of taxable Canadian property to...

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25 June 2012 External T.I. 2012-0446361E5 - Determination of residency Status

A residency determination for an individual should be obtained by sending a completed NR73 to the International Tax Services Office, 2204 Walkley...

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8 December 2011 External T.I. 2011-0427451E5 F - Statut de résidence fiscale

The taxpayer who had already left Canada wished the Rulings Directorate to intervene to determine her tax residence status. The Directorate noted...

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8 June 2010 STEP National Roundtable Q. 15, 2010-0363111C6 - Residency of a Trust

In response to a question respecting the scope of the Garron case, CRA stated that it continues to be its view that the residence of a trust or...

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20 April 2010 External T.I. 2010-0355071E5 F - Ligne directrice 4

In discussing whether an organization had its central management and control on a reserve, CRA stated:

The term "employer is resident on a...

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Locations of other summaries Wordcount
Tax Topics - Other Legislation/Constitution - Federal - Indian Act - Section 87 Indian organization did not qualify under Guideline 4 where 20% of clientele lived off reserve 83

18 September 2008 External T.I. 2008-0264381E5 F - Résidence d'une fiducie

Non-resident individuals entrusted the custody of certain funds to the Quebec office of a Canadian financial institution, which held the funds in...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(1) securities depositary and custodian did not hold assets under a trust 133

2004 Ruling 2004-0099651R3 - Migration to Canada / PUC Reduction

Opinion that a non-resident corporation would become resident in Canada upon replacing its board with a new board a majority of whom resided in...

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2004 Ruling 2004-0103111R3 - Foreign affiliates; indirect payment

Description in the statement of facts of the factual basis for the representation by the taxpayer that a U.S. LLC would be resident in the United...

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2004 Ruling 2004-0099651R3 - Migration to Canada / PUC Reduction

Opinion that a non-resident corporation would become resident in Canada upon replacing its board with a new board a majority of whom resided in...

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19 June 1994 Internal T.I. 9413156 - CANADIAN RESIDENT STATUS OF U.S. VISA HOLDERS (7576-1)

RC is in agreement that it may be possible for an individual to sever his residential ties with Canada and not become a resident of the United...

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19 June 1992 Hong Kong Seminar, Q. A.1-A.3 (May 1993 Access Letter, p. 225)

An individual is resident in Canada if that is where the individual, in a settled routine of life, regularly, normally or customarily lives.

Tax Professionals Mini Round Table - Vancouver - Q. 16 (March 1993 Access Letter, p. 105)

RC recognizes that an individual who is resident both in Canada and the U.S. under the Income Tax Act and the Internal Revenue Code but who is a...

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8 July 1992 T.I. 9210362 (January - February 1993 Access Letter, p. 5, ¶C2-017)

Discussion of whether an individual becomes resident at the time when he establishes permanent residence for immigration purposes.

27 September 1991 Memorandum (Tax Window, No. 10, p. 15, ¶1489)

Discussion of factors bearing on whether an individual who has left Canada for more than two years continues to be a resident.

September 1991 Memorandum (Tax Window, No. 9, p. 23, ¶1457)

A trust generally will be considered to reside on an Indian reserve if the trustee or the majority of the trustees who manage or control the...

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IT-447 "Residence of a Trust or Estate

IT-221R2 "Determination of an Individual's Residence Status"

Certificate of residency "CRA cannot certify the residency of a partnership because partnerships are not considered resident; however, the individual partners of a partnership can ask for a certificate."

Articles

Brian Kearl, Carl Deeprose, "Leaving Canada's New High Tax Rate Regime: Considerations, Tips and Traps", 2016 Conference Report (Canadian Tax Foundation),32:1-24

Significance of residential ties (p. 32:7)

[E]migrating Canadians should not leave an available residence behind, and should emigrate with their...

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Joel A. Nitikman, "Central Management and Control and the Rule in Esquire Nominees: Where are we after Hua Wang Bank Berhad?", International Tax Planning, Federated Press, Vol. XX, No. 1, 2015, p. 1368.

Residence test for SPV (p. 1371)

[A] corporate taxpayer, resident in one country, establishes a special purposes vehicle ("SPV") in another...

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H. Michael Dolson, "Trust Residence After Garron: Provincial Considerations", Canadian Tax Journal, (2014) 62:3, 671-99.

Application of corporate central management and control test (pp. 694-5)

[O]nce the elements of control in respect of the trust property have been...

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Kevyn Nightingale, "New Canadian Citizenship Rules (Bill C-24) and Tax", CCH Tax Topics, No. 2190, February 27, 2014, p. 1

Old citizenship rule (p.1)

As Citizenship and Immigration Canada ("CIC") says:

"According to the current Citizenship Act, applicants must have...

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P. Bourgeois, L. Blanchette, "Income_Taxes.ca.com: The Internet, Electronic Commerce, and Taxes - Some Reflections, Part 2", 1997 Canadian Tax Journal, Vol. 45, No. 6, p. 1378.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 253 0

P. Bourgeois, L. Blanchette, "Income_Taxes.ca.com: The Internet, Electronic Commerce, and Taxes - Some Reflections, Part 1", 1997 Canadian Tax Journal, Vol. 45, No. 5, p. 1127.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 253 0

Oliver, "Company Residence - Four Cases", 1996 British Tax Review, No. 5, p. 505: Discussion of the clockwork residence theory.

Bowman, "Sophisticated Estate-Planning Techniques: Cross-Border Dimensions", 1993 Conference Report, c. 38: Discussion (at pp.16-17) of whether a Canadian-resident "protector" may cause a trust established outside Canada to be considered to be resident in Canada; and of the weight to be given to the jurisdiction of the governing law of the trust in determining the residence question.

Monteith, "The Problem of Foreseeable Return", Taxation of Executive Compensation and Retirement, December/January 1994, p. 851.

Kroft, "Jurisdiction to Tax: An Update", 1993 Corporate Management Tax Conference Report, c. 1.

Sheridan, "The Residence of Companies for Taxation Purposes", British Tax Review, 1990, No. 3, p. 78: Review of the U.K. case law on residence.

Green, "The Residence of Trusts for Income Tax Purposes", 21 Canadian Tax Journal, May-June 1983, p. 217.

Wosner, "Ordinary Residence, the Law and Practice", 1983 British Tax Review, p. 347.

Subsection 2(3) - Tax payable by non-resident persons

Forms

Paragraph 2(3)(a)

See Also

Hewitt v. MNR, 89 DTC 451, [1989] 2 CTC 2278 (TCC)

The taxpayer left Canada to work in Libya for an oil company, and entered into a "thrift plan" offered by the oil company under which he agreed to...

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Administrative Policy

IT-168R3 "Athletes and Players Employed by Football, Hockey and Similar Clubs" under "Non-Residents"

Paragraph 2(3)(b)

Commentary

A non-resident of Canada who carries on business in Canada will be subject pursuant to s. 115(1)(a)(ii) to Part I tax on its income from carrying...

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Cases

Randall v. The Queen, 85 DTC 5208, [1985] CTC 268, [1985] 1 CTC 268 (FCTD)

A Mexican resident who was a "silent" or inactive partner in a B.C. partnership was found to have been carrying on business in Canada...

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Capitol Life Insurance Co. v. The Queen, 84 DTC 6087, [1984] CTC 141 (FCTD), aff'd 86 DTC 6164, [1986] 1 CTC 388 (FCA)

The mere fact that an American insurance company does business, and enters into insurance contracts as an underwriter, with a Canadian corporation...

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Pullman v. The Queen, 83 DTC 5080, [1983] CTC 52 (FCTD)

Where the basic administrative decisions in a money-lending business - the acceptance or rejection of financing opportunities made available to...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 253 - Paragraph 253(b) 41

Loeck v. The Queen, 82 DTC 6071, [1983] CTC 64, [1982] CTC 64 (FCA)

The purchase and sale, within a 4-year period, of 4 separate properties in the Toronto and St. Catharines area by a German resident in conjunction...

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Sudden Valley Inc. v. The Queen, 76 DTC 6178, [1976] CTC 775 (FCTD), aff'd 76 DTC 6448, [1976] CTC 775 (FCA)

The taxpayer, which was a U.S. corporation engaged in selling lots in a recreational home development in Sudden Valley in the State of Washington...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 253 - Paragraph 253(b) 162

Sandhu v. The Queen, 80 DTC 6097, [1980] CTC 158 (FCTD)

A non-resident partner of a Canadian partnership is ipso facto carrying on business in Canada.

See Also

Gulf Offshore N.S. Limited v. The Queen, 2006 DTC 2705, 2006 TCC 246

The taxpayer, who provided a fully-crewed vessel under a charter party to a Canadian company for use during an 88 day period in the transporting...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 5 184

AAi. FosterGrant of Canada Co. v. Canada (Commissioner of the Canada Customs and Revenue Agency), [2004] 3021 ETC, 2004 FCA 259

The taxpayer, which was a wholly-owned subsidiary of its U.S. parent, and which took title to goods upon their delivery to a warehouse facility...

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Munich Reinsurance Co. (Canada Branch) v. The Queen, 2000 DTC 2009 (TCC)

Bowman A.C.J. found (at p. 2015) that although refund interest was not referable to property held in the course of carrying on a business in...

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Arbutus Gardens Apartments Corp. v. The Queen, 98 DTC 1795, [1998] 3 CTC 2972 (TCC)

A limited partnership having non-resident limited partners was found to be carrying on business for purposes of s. 2(3) of the Act and Regulation...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Regulations - Regulation 805 apartment complex requiring significant property management generated business income 134

Valec S.A. v. The Queen, 98 DTC 1266 (TCC)

In finding that non-resident corporations that owned undivided shares in a Montreal office building that was rented primarily to one tenant...

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GLS Leasco Inc. v. MNR, 86 DTC 1484, [1986] 2 CTC 2034 (TCC)

A wholly-owned U.S. subsidiary ("GLS") of another U.S. corporation ("Centra") was denied the recognition of non-capital losses on the basis that...

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Hull v. Wilson (1995), 128 DLR (4th) 403 (Alta. C.A.)

The only connection of the appellant with the State of Idaho was as a purchaser of goods there and as a party to an agreement with an Idaho...

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Grocott v. The Queen, 95 DTC 0 (TCC)

Bowman TCJ. found that the taxpayer was carrying on business in Canada by virtue of being a limited partner in a limited partnership that financed...

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T.D.I. Hospitality Management Consultants Inc. v. Browne (1994), 117 DLR (4th) 289 (Man. C.A.)

The appellant, who resided and had an office in Alberta, made arrangements by telephone for a musical group to perform at the respondent's inn in...

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Étoile Immobililière S.A. v. MNR, 92 DTC 1984, [1992] 2 CTC 2367 (TCC)

A large rental complex consisting of 158 townhouses and related facilities such as playgrounds, a large outdoor pool and a large underground...

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Lainiere de Roubaix F.A. v. Craftsman Distributors Inc., [1991] 5 WWR 217 (BCCA)

A French company which shipped yarn from France to fill orders placed in Canadian dollars by the B.C. defendant, drew several payments on a B.C....

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The Queen v. London Life Insurance Co., 90 DTC 6001, [1990] 1 CTC 43 (F.C.A)

Stone J.A. rejected a submission that the determination of whether a business was carried on in a country other than Canada "should depend solely...

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Hafton Properties Ltd. v. McHugh, [1987] BTC 18 (HCJ)

Although a business can be carried on directly in the U.K. by an overseas person without having a branch or agency in the U.K., the lending of...

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Geigy (Canada) Ltd. v. Social Services Tax Commissioner, [1969] CTC 79 (BCSC)

The appellant manufactured drugs in Montreal and sold them to wholesalers and institutional customers across Canada pursuant to orders that were...

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Firestone Tyre & Rubber Co. Ltd. v. Lewellin (1957), 37 TC 111 (HL)

tThe taxpayer ("Brentford"), which was a U.K. subsidiary of a U.S. corporation ("Akron") manufactured tires for sale, as agent for Akron, to...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Agency - Agency 36

Belfour v. Mace (1925), 13 TC 539 (CA)

A firm of Italian silk manufacturers and merchants was found to be exercising a trade in the U.K. in light of its practice of having its...

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Weiss, Biheller & Brooks, Ltd. v. Farmer (1922), 8 TC 381 (CA)

The taxpayer, which was an English company carrying on business as an importer and merchant, and which was the exclusive distributor of gas...

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F.L. Smidth & Co. v. F. Greenwood (1921), 8 TC 200 (CA), aff'd 206 (HL)

The taxpayer, which manufactured cement-making equipment in Denmark, delivered the machinery F.O.B. at Copenhagen, and concluded the sales...

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Linde Canadian Refrigerator Co. v. Saskatchewan Creamery Co. (1915), 51 SCR 400

iThe appellant, whose head office was in Quebec, sold machinery to purchasers in Saskatchewan. Conflicting views were expressed by Anglin J. and...

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Grainger & Son v. Gough (1896), 3 TC 462 (HL)

In finding that a French wine producer was not exercising a trade in the U.K. by virtue of English agents receiving orders for the wine and...

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Administrative Policy

Guidance on international income tax issues raised by the COVID-19 crisis, CRA Webpage 31 March 2021

CRA referred to the travel restrictions imposed by governments or businesses in response to the COVID-19 crisis as a safety measure for their...

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16 March 2018 Ruling 158124

As a small part of its business, a U.S. resident who is not registered for GST/HST purposes (“USco”) supplies information services to Canadian...

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Locations of other summaries Wordcount
Tax Topics - Excise Tax Act - Section 240 - Subsection 240(1) USco’s use of a Canadian affiliate for substantial marketing support for web-delivered services did not constitute carrying on business in Canada 356
Tax Topics - Excise Tax Act - Schedules - Schedule VI - Part V - Section 5 zero-rating of marketing assistance provided by Canco to U.S. affiliate 186

27 November 2017 External T.I. 2017-0731441E5 - Interchange Canada and Business Number

A non-resident employee of a non-resident corporation (NRCo) will work for a year at a Canadian government department while remaining on the NRCo...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 150 - Subsection 150(1) - Paragraph 150(1)(a) a non-resident corporation is carrying on business in Canada by virtue of being the legal employer of an employee seconded to Canada 179
Tax Topics - Income Tax Regulations - Regulation 102 - Subsection 102(1) NR company seconding employee to Canada subject to Reg. 102 withholding requirement but not EI or CPP 173
Tax Topics - Income Tax Regulations - Regulation 105 - Subsection 105(1) salary reimbursement payments made to seconding NR employer subject to withholding 121

9 February 2012 External T.I. 2008-0280941E5 F - Foreign sourced income - transportation

In the course of a general discussion of s. 4(1)(b), CRA stated:

If a taxpayer's business activities in a foreign country are incidental to its...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 4 - Subsection 4(1) - Paragraph 4(1)(b) s. 4(1)(b) generally applied on a jurisdictional basis 157
Tax Topics - Income Tax Act - Section 126 - Subsection 126(9) s. 4(1)(b) applied for s. 126(9) purposes 161
Tax Topics - Income Tax Act - Section 126 - Subsection 126(7) - Business-Income Tax NY franchise tax qualified as an income tax only if it was not based on non-income specified minimums 238

1999 Ruling 9920603 - NON-RESIDENT - CARRYING ON BUSINESS IN CDA

Ruling that a Canadian company engaged by a non-resident fund manager to provide accounting and clerical services in Canada would not thereby...

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30 October 1997 External T.I. 9716735 - : Taxation of Non-Resident Partners

A non-resident limited partner of a partnership which carries on business in Canada through a Canadian permanent establishment is considered to be...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 212 - Subsection 212(13.1) - Paragraph 212(13.1)(b) withholding where non-resident partnership with Cdn partners 93

30 November 1996 Ruling 9704923 - CARRYING ON BUSINESS IN CANADA - ADM. SERVICES

Where a non-resident corporation has contracted to perform certain administrative duties for other non-resident corporations, the fact that it has...

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31 May 1993 Memorandum (Tax Window, No. 32, p. 15, ¶2613)

A list of the factors considered in determining whether a taxpayer is carrying on business in Canada.

Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 5 16

13 January 1993 Memorandum 923695 (November 1993 Access Letter, p. 487, ¶C2-019)

Medical services performed in Canada by a non-resident doctor would constitute carrying on business in Canada.

85 C.R. - Q.20

A non-resident partner of a partnership carrying on business in Canada is considered to be carrying on business in Canada and therefore is taxable...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 114 40

IT-420R3 "Non-Residents - Income Earned in Canada"

IT-81R "Partnerships - Income of Non-Resident Partners"

Each partner is the agent of the other partners and hence, although a partner may not himself actively participate in the business of the...

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Articles

Susan McKilligan, "Carrying Business in Canada", International Tax, CCH Wolters Kluwer, No. 90, October 2016, p. 13

Essential finding in Equustek (p. 13)

In Equustek Solutions Inc. v. Google Inc., [fn 1: 2015 BCCA 265.] the BC Court of Appeal dismissed Google...

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Jack Bernstein, "Electronic Commerce", Tax Profile, Vol. 6, No. 5, May 2000, p. 51.

Michael P. Boyle, "The Emerging International Tax Environment for Electronic Commerce", Tax Management International Journal, Vol. 28, No. 6, 11 June 1999, p. 357.

Constantine Kyres, "Carrying on Business in Canada", 1995 Canadian Tax Journal, Vol. 45, No. 5, p. 1629.

V. Krishna, "International Income Taxation of Electronic Commerce", Canadian Current Tax, Vol. 9, No. 4, January 1999, p. 33.

Harris, "Developments in Asset-backed Financing: Tax Considerations", Business Vehicles, Vol. III, No. 3, 1997, p. 136

It was understood that Revenue Canada has given a favourable ruling that the use of a non-resident securitization vehicle would not be viewed as...

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Power, "The Taxation of Non-Resident Investment in Canadian Real Estate", 1989 Canadian Tax Journal, September-October issue, p. 1266