Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues: How to determine a person's residency status.
Position: A person's residency status is based solely on facts for that person. (i.e. question of fact).
Reasons: A person should file form NR73 for a residency determination.
April 17, 2000
XXXXXXXXXX
Dear XXXXXXXXXX:
Thank you for your letter of November 16, 1999, concerning the meaning of "resident" under the Income Tax Act.
For the purpose of the Act, the residence status of an individual is the crucial criterion in determining liability for tax under the Act, as residents of Canada are liable to tax in Canada on their world-wide income, and non-residents are liable to tax in Canada only on Canadian source income.
The term "resident" is not defined in the Act. In general, its meaning is based on common law principles. Therefore, the residence of an individual in each case is a question of fact. For a limited number of cases, for example, individuals who are employees of the Government of Canada and their spouses, there are rules in the Act which deem those individuals to be residents of Canada even though, under common law, they would not be residents.
Although to determine an individual's residency status may be straightforward in some cases, some individuals may need assistance. In this regard, the CCRA issued several publications on the subject and has procedures available to assist such individuals. This information is available at any CCRA tax services office across Canada and at the CCRA's Internet web site www.ccra-adrc.gc.ca.
The pamphlet entitled Emigrants and Income Tax, a copy of which is attached, assists Canadian who leave Canada to work abroad or for other reasons; provides guidance for determining residency status; and lists persons at the International Tax Services Office (ITSO) who can provide additional assistance. Furthermore, anyone who requires clarification on their residency status may complete and mail to ITSO Form NR73, Determination of Residency Status (leaving Canada), which is in the pamphlet. The ITSO will respond to their query on their residency status based on the information provided on the form.
As with any income tax issues, there are residency cases where the individuals may dispute the views of the CCRA, but overall, the procedures put in place to determine an individual's residency status are working well.
Due to the many variables involved, it does not appear possible to provide a clear definition of "resident" in the Act that would apply for all cases. Therefore, while the Department of Finance is responsible for amending the Act, the CCRA has not considered it necessary to recommend such an amendment to that department. In addition, officials of that department are fully aware of this matter.
I trust I have addressed your concerns on this matter.
Yours sincerely,
Martin Cauchon
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