Overseas Work and Taxes
Thread Starter
Joined: Apr 2001
Posts: 14
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Overseas Work and Taxes
I saw a question about Canadian Taxes and overseas work on another website, so I thought I'd throw in my 10 cents worth here.
We are all looking for that overseas tax-free job, but are shocked when we see on page one (1) of our yearly tax return, that we must declare our income from both inside and outside of Canada. To soften the blow, you have to fill Form NR73E (preferably before you depart for your new job) to determine if you are a Factual Resident (keeps ties with Canada), or are a "Non-Resident" (have severed all residential ties with Canada). I know guys (myself included) that get a severe overtemp, when they consider other countries and their agreeable tax laws for overseas workers, and then consider ours.
I hope this will be a usefull discussion for everyone.
Regards, Max
We are all looking for that overseas tax-free job, but are shocked when we see on page one (1) of our yearly tax return, that we must declare our income from both inside and outside of Canada. To soften the blow, you have to fill Form NR73E (preferably before you depart for your new job) to determine if you are a Factual Resident (keeps ties with Canada), or are a "Non-Resident" (have severed all residential ties with Canada). I know guys (myself included) that get a severe overtemp, when they consider other countries and their agreeable tax laws for overseas workers, and then consider ours.
I hope this will be a usefull discussion for everyone.
Regards, Max
Joined: Aug 2000
Posts: 284
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From: in a van, down by the river
I don't know enough about our tax system to really start comparing notes to a percentage, but sounds pretty simular.
I'm surprised that, with the number of people on this forum, there wasn't a bigger response??
I'm surprised that, with the number of people on this forum, there wasn't a bigger response??
Joined: Sep 2001
Posts: 219
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From: South of 60
If a tax break is what you're looking for, you're pretty well committed to having to become a non-resident. If you decide to fill out RevCan's lovely NR73 form, may I suggest reading it very carefully as you answer the questions.
Just because you fill out the form, doesn't mean you will be deemed a non-resident. RevCan is looking to see if you have severed enough ties with Canada.
As a last bit of advice, identify an accountant who is familiar with the whole non-resident scenario and work closely with that person as you sort everything out.
Just because you fill out the form, doesn't mean you will be deemed a non-resident. RevCan is looking to see if you have severed enough ties with Canada.
As a last bit of advice, identify an accountant who is familiar with the whole non-resident scenario and work closely with that person as you sort everything out.
It's not just an adventure....
it's just a job!
Joined: Nov 2000
Posts: 219
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From: Philippines
To All:
If you are a Canadian Resident, working for a Canadian company in a designated industy (i.e. Offshore Exploration) and you have worked at least 182 days out of the country,(not phyisically) on that job deriving 90% of your income from that job, you are entitled to claim the Overseas Employment Tax Credit or OETC.
The OETC exempts your first $80,000.00 of 80% of the payable Federal Income Tax and in most provinces a reciprocal 80% tax break (100% exemption in Quebec).
In short, you pay tax on 20% of your total income up to $80,000.00 or about a 6% flat tax on your total income.
For further info, check the Customs & Revenue website on the OETC.
Hope this helps.
Cheers
OffshoreIgor
[ 17 September 2001: Message edited by: offshoreigor ]
[ 17 September 2001: Message edited by: offshoreigor ]
If you are a Canadian Resident, working for a Canadian company in a designated industy (i.e. Offshore Exploration) and you have worked at least 182 days out of the country,(not phyisically) on that job deriving 90% of your income from that job, you are entitled to claim the Overseas Employment Tax Credit or OETC.
The OETC exempts your first $80,000.00 of 80% of the payable Federal Income Tax and in most provinces a reciprocal 80% tax break (100% exemption in Quebec).
In short, you pay tax on 20% of your total income up to $80,000.00 or about a 6% flat tax on your total income.
For further info, check the Customs & Revenue website on the OETC.
Hope this helps.
Cheers
OffshoreIgor [ 17 September 2001: Message edited by: offshoreigor ]
[ 17 September 2001: Message edited by: offshoreigor ]
Joined: Nov 1998
Posts: 111
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From: UK
If I were to move to Canada from the UK to work and I were to pay Canadian Tax, what would the regime be like? If I were to be paid say $5-6k per month, what would I take home outside of Quebec? Any input would be greatly appreciated.
Joined: Aug 2000
Posts: 284
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From: in a van, down by the river
Pitchlink,
You can probably figure on giving the government about 45% of your earnings!! Or you could look at it this way, around mid to late May you'll have paid off the government and can start working for yourself!!
You can probably figure on giving the government about 45% of your earnings!! Or you could look at it this way, around mid to late May you'll have paid off the government and can start working for yourself!!
Joined: Feb 2001
Posts: 579
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From: Canada
Pitchlink: A good rule of thumb for income between 50 to 90K is about 30%. i.e. If you are a single entity and earn $70,000 you'll probably pay $21,000 in tax.( thats in Ontario, the highest taxed province is Quebec , with the lowest tax rate is in Alberta)
It goes on a sliding scale with 17% on the 1st $24K 30% on the amount from 24K to 50K and 50% on the amount over 50K. These figures are not exact and I'm only quoting from memmory. The amount of tax you pay can also be lowered by investing in retirement savings plans.
In addition to income tax there is also a Goods and Service Tax (GST) @ 7% and a Provincial Sales Tax (PST) @ 8% (Ontario) on purchased goods.
It goes on a sliding scale with 17% on the 1st $24K 30% on the amount from 24K to 50K and 50% on the amount over 50K. These figures are not exact and I'm only quoting from memmory. The amount of tax you pay can also be lowered by investing in retirement savings plans.
In addition to income tax there is also a Goods and Service Tax (GST) @ 7% and a Provincial Sales Tax (PST) @ 8% (Ontario) on purchased goods.
