Frequently Asked Questions

Residency status in Canada is based on significant residential ties such as a primary dwelling, family connections and social relationships. Secondary ties like memberships, driver’s license and credit cards are also considered. Each case is unique, so a detailed review of your situation helps clarify your obligations.

Canadian residents must report worldwide compensation on their annual T1 returns. This includes salaries, consulting fees and benefits received abroad. Proper documentation of foreign sources and currency conversion records is essential for accurate reporting.

Canada’s treaties provide opportunities to reduce withholding rates on cross-border payments such as royalties, interest and service fees. By examining treaty provisions and eligibility criteria, you can align payments with applicable rates and avoid double reporting.

Transfer pricing compliance requires intercompany agreements, functional and risk analysis, comparable transaction studies and clear documentation of pricing policies. Maintaining thorough records supports discussions with tax authorities and demonstrates adherence to OECD guidelines.

Canadian regulations require retaining tax records for six years from the end of the relevant tax year. This includes contracts, invoices, financial statements and correspondence with foreign authorities to support your filings if reviewed.