Do I have to declare income earned outside Canada?
Whether you need to declare income from outside sources depends on several things, like your residency status, the type of income earned, and details about your foreign investments.
All amounts must be reported in Canadian dollars.
Use the Bank of Canada exchange rate that was in effect on the day you received the income.
If you received this income a number of times during the year, use the average annual exchange rate.
Foreign income
If you live in Canada, you need to report all your income from around the world on your taxes. If you paid tax to another country on any of that income, you can't use that amount to lower your Canadian income. Instead, you may be able to claim a foreign tax credit on your federal tax return.
Becoming a resident
If you moved to Canada and became a resident, the CRA treats it as if you sold and then bought back any property that you owned or brought with you. This sets a cost base for everything you owned when you became a resident. If you later sell any of that property, this cost base will be used to calculate your capital gain or loss.
Foreign property and investments (T1135)
The CRA requires you to report foreign property and investments if the total cost of all of your foreign property is greater than $100,000 CAD at any time during the year. The CRA could impose penalties for failing to report this information on your T1135, which is a form that is separate from your income tax return.
