
5 Tips for Better Bitcoin Accounting
Reading Time: 3 minutes The IRS and the CRA have taken cryptocurrency accounts under their scrutiny. You must report your crypto assets for the taxation processes. Since cryptocurrency is
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Reading Time: 3 minutes The IRS and the CRA have taken cryptocurrency accounts under their scrutiny. You must report your crypto assets for the taxation processes. Since cryptocurrency is
Reading Time: 4 minutes The cryptocurrency market is booming each day. Investors, companies, and institutions have taken notice of it. Moreover, it has already been included in your taxation
Reading Time: 4 minutes Cryptocurrency tax is the talk of the town now. The IRS (Internal Revenue Service) has taken notice of it. The CRA (Canada Revenue Agency) is
Reading Time: 4 minutes With each new year, cryptocurrencies enter a new era as well. In 2008, Satoshi set its foundation. Moving on, investors step in to gain huge
Reading Time: 3 minutes Retirement plans can often be confusing. Moreover, the complex rules and regulations can add to their complexity. In this article, we have discussed different concepts
Reading Time: 3 minutes Understanding the Basics If you read about taxation processes, you will be welcomed by heavy jargon from everywhere. Nobody understands your situation more than we
Reading Time: 3 minutes The taxation process is confusing. It’s normal to think this way, considering the number of laws, rules, and forms we need to interpret. Confusion between
Reading Time: 3 minutes Understanding Foreign Tax Credit Taxation terms, sometimes, appear very complex to understand. Moreover, the rules and regulations involved in the process make the situation more
Reading Time: 3 minutes FBAR Filing Date The deadline to file FBAR generally is April 15th. However, you are given an automatic extension on October 15th if you don’t
Reading Time: 5 minutes What Does TFSA Mean? Let’s decode the abbreviation first, TFSA stands for “Tax-Free Savings Account”. As obvious by the name itself, a TFSA gives you
Reading Time: < 1 minutes We’re excited t share some new Tax Facts and Filing Statistics in a new infographic! Take a look at the information below to see how
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…or any US resident or citizen living anywhere else in the world, income tax returns need to be filed in the US using the customary Form 1040. This can be filed either separately or jointly (if married).
If you are employed by a US company in Canada, then you fall under the Canada US Income Tax Convention. This means that your employment income is exempt from taxation by Canada unless it is above $10,000 per year. If higher than $10,000, your income is exempt if:
The individual resided in Canada for less than 183 days in any Calendar year
The exemption is not borne by a Canadian citizen or a Canadian resident employer with a fixed base in Canada
If you are self employed US citizen/resident in Canada, aside from filing Form 1040 and Schedule C in the US to declare your worldwide earnings there are other things involved. Based on your current residence, you are required to either pay the US’s self-employment tax (15.3% for incomes up to $118,500) or Canadian Pension Plan (CPP) premiums to cover your social security taxes.
Whether you are considered employed or not in Canada is dependent on whether your primary work place falls under the definition of “Permanent Establishment” as per the Canada-US Tax Treaty.
As a proven resident of both countries, you are at risk for double taxation on your worldwide earnings if you are not careful. The Canada US Income Tax Convention provides solutions for this.
As a U.S citizen or resident alien having a tax home in a foreign country (i.e., place of business/employment permanently or indefinitely based in a foreign country) and meeting the criteria of either the Bona Fide Residence Test or Physical presence Test, you can elect “Foreign Earned Income Exclusion”.
Foreign housing cost is also excludable for payments made by an employer either on your behalf or as a reimbursement for incurred housing cost. This amount is taxable foreign earned income. (Availing this may in some cases offset your earned income exclusion).
Foreign Tax Credits (FTC): If you are a US citizen or expat paying foreign income taxes, the same foreign income will become a US tax liability. To alleviate that burden of 2-country double taxation, you are provided with appropriate tax credits on your US tax liability.
For assistance in planning and transferring your U.S. assets to Canada, please contact our colleague Phil Hogan, CPA, CA, CPA at (25) 661-9417 or phil@philhogan.com