A.T. Financial Newsletter
U.S. residents in Canada take note:
Uncle Sam wants your tax dollars
If youâ€™re a U.S. resident living in
Canada or a greencard holder,
legislation that went into effect
in July of 2014 may have put
you on Uncle Samâ€™s tax radar.
The U.S. government has
always required U.S. persons to
pay U.S. taxes regardless of
where in the world they actually
reside. But the Foreign Account
Tax Compliance Act (FATCA)
takes that a very big step further.
It compels foreign governments
to actively participate in
identifying and reporting
As a result, Canadian
financial institutions now have
to report accounts that appear to be held by U.S. persons to
the CRA. The CRA then must share its findings with the IRS.
And the IRS in turn, will undoubtedly use this information to
ensure itâ€™s getting its fair share of your tax wallet.
The rules governing who is considered a U.S. person can be
complex and can even extend beyond people to estates and
trusts. If you are a U.S. citizen, greencard holder, or someone
who spends considerable time in the U.S., consider meeting
with your tax advisors to get clarity about how this sweeping
legislation might affect you.
TIPS AND TACTICS TO HELP YOU GET AHEAD
Giving to overseas charities?
You might not get a tax receipt
The Canada Revenue Agency
(CRA) recently changed the rules
governing foreign charities and
their ability to issue tax receipts.
And the news isnâ€™t good if you
Foreign charities must now
formally apply to the CRA for
qualifying status. Only charities
that are involved in disaster relief,
humanitarian aid, or activities deemed to be in Canadaâ€™s
â€œnational interestâ€ qualify.
As of this writing, the CRA has recognized only a handful of
internationally based charities. So while you can still donate to
the Aga Khan Foundation, your alma mater overseas, or any other
non-Canadian charity, you might not be able to claim the donation
on your tax return.
For a complete and current list of the eligible charities, visit
www.cra-arc.gc.ca and search for â€œforeign charities.â€
A better way to get your tax refund
Expecting your tax refund to arrive soon? You might think thatâ€™s reason to
celebrate â€” but think again. After all, a tax refund is just the governmentâ€™s way
of paying your money back â€” without interest.
If you are expecting significant tax deductions in 2015 (perhaps from RRSP
contributions, support payments, childcare expenses, or a large charitable
donation), you can arrange to get your tax breaks throughout the year, rather
than having to wait until 2016. All you need to do is fill out a little paperwork:
- File form T1213, Request to Reduce Tax Deductions at Source, with the
Canada Revenue Agency (CRA). Quebec residents also need to file Quebec
provincial form TP-1016.
- If your request is approved, your employer will be authorized to reduce
the amount of tax withheld at source, leaving you with more money every
- To really make the most of this strategy, consider setting up an automatic
investment program for that money.
Whether youâ€™re looking for advice on how best to use your tax refund or
how to avoid getting one next year, weâ€™re here to help you.
For more information,
please contact us at