I entered Canada in Aug 2022 (moved from USA). Do I still need to report foreign income on my tax return?
Note that I did not receive income after becoming a resident of Canada from Aug 2022.
If I need to report foreign income, can I claim Foreign Income Tax Credit?
Note that I'm not a citizen of either USA or Canada. I was on a student visa in USA and I'm on a work permit in Canada.
As a general rule, residents of Canada are required to report their worldwide income on their Canadian tax return, regardless of where the income was earned. However, individuals who become residents of Canada partway through the year may be exempt from reporting foreign income for the period before they became residents.
In your case, since you became a resident of Canada in August 2022 and did not receive any foreign income after that point, you likely do not need to report any foreign income earned prior to your arrival in Canada.
If you did earn foreign income before becoming a resident of Canada and need to report it, you may be able to claim a Foreign Tax Credit for any foreign taxes paid on that income. The Foreign Tax Credit is designed to prevent double taxation, and allows you to offset your Canadian tax liability by the amount of foreign taxes paid on the same income.
NOTE: As a non-citizen of both the USA and Canada, it's important to note that your tax obligations may be affected by any tax treaties that exist between your home country and Canada. These treaties can impact your residency status, the type of income you need to report, and the tax rates that apply to your income.
For clarification and guidance we advise you contact the Canada Revenue Agency at 1-800-959-8281.
Thank you for choosing TurboTax.
As a general rule, residents of Canada are required to report their worldwide income on their Canadian tax return, regardless of where the income was earned. However, individuals who become residents of Canada partway through the year may be exempt from reporting foreign income for the period before they became residents.
In your case, since you became a resident of Canada in August 2022 and did not receive any foreign income after that point, you likely do not need to report any foreign income earned prior to your arrival in Canada.
If you did earn foreign income before becoming a resident of Canada and need to report it, you may be able to claim a Foreign Tax Credit for any foreign taxes paid on that income. The Foreign Tax Credit is designed to prevent double taxation, and allows you to offset your Canadian tax liability by the amount of foreign taxes paid on the same income.
NOTE: As a non-citizen of both the USA and Canada, it's important to note that your tax obligations may be affected by any tax treaties that exist between your home country and Canada. These treaties can impact your residency status, the type of income you need to report, and the tax rates that apply to your income.
For clarification and guidance we advise you contact the Canada Revenue Agency at 1-800-959-8281.
Thank you for choosing TurboTax.