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  • KimDuHan
  • Hero of Waygookistan

    • 1332

    • January 15, 2015, 11:48:59 am
    • Seoul
Canadian government tax audit?
« on: April 11, 2016, 11:20:45 am »
Has anyone had a CRA audit when they returned to Canada?


  • gnomon
  • Veteran

    • 160

    • February 05, 2014, 01:24:34 pm
    • Gunpo
Re: Canadian government tax audit?
« Reply #1 on: April 11, 2016, 11:40:39 am »
Have you been filing your taxes while you're in Korea? I still need to backfile that last couple of years.


  • busandar
  • Super Waygook

    • 276

    • March 05, 2013, 11:41:05 am
    • Busan, South Korea
Re: Canadian government tax audit?
« Reply #2 on: April 11, 2016, 11:51:08 am »
There's a great thread on all things Canadian tax. I believe a few people have mentioned being audited, not many though - Take a look and hopefully you'll find some helpful info there.

http://www.waygook.org/index.php/topic,472.0.html


  • KoreaBoo
  • Expert Waygook

    • 582

    • May 25, 2014, 04:00:42 pm
    • Vancouver Island
Re: Canadian government tax audit?
« Reply #3 on: April 11, 2016, 11:51:59 am »
Canadians are not legally obliged to file unless they owe CRA money.

If you've done what most Canadians here have done (kept their ties and residency in Canada and hoping they would not be caught by CRA when they returned) went back and got hit with a serious tax bill.

I've seen it happen.  I've watched people's savings evaporate instantly.  Unless you can prove you were not a resident in Canada, you will owe money.  I've met so many people here who thought they knew it all...got nailed and ended up with nothing.  All it takes is a simple question "how did you support yourself for all that time?" and you're pretty much SOL.

Also....NEVER LIE ABOUT YOUR INCOME to the CRA.  If you do an they find out what you made (and they will), you'll get nailed with penalties, a possible criminal charge and you're essentially f*cked.

IF you can prove you were a non-resident, you'll be fine.  At worst, you'll owe money.  You will need to prove income and taxes paid (the forms can be found online through the NTS).  If you worked at a hogwan or were not registered properly, you may not only be liable for your taxes but if you cannot prove your income, CRA will use the average income for your employment (they are well aware of teaching in Korea) and assign a tax bill + penalties.

Good luck!


  • Malinka
  • Adventurer

    • 26

    • August 28, 2014, 09:41:50 pm
    • Jeju
Re: Canadian government tax audit?
« Reply #4 on: April 11, 2016, 02:19:34 pm »
Sorry, I'm confused by the above post.

Why would Canadians owe money upon return to Canada? Unless they're in Korea for a 6 month gig, they're not Canadian residents and don't owe any money (from what I understand).

Why would they need to report their foreign earnings? Since they don't pay foreign (Canadian) taxes, it's frankly none of their (the CRA's) business.

Did tax laws change?


Re: Canadian government tax audit?
« Reply #5 on: April 11, 2016, 02:21:06 pm »
Canadians are not legally obliged to file unless they owe CRA money.

If you've done what most Canadians here have done (kept their ties and residency in Canada and hoping they would not be caught by CRA when they returned) went back and got hit with a serious tax bill.

I've seen it happen.  I've watched people's savings evaporate instantly.  Unless you can prove you were not a resident in Canada, you will owe money.  I've met so many people here who thought they knew it all...got nailed and ended up with nothing.  All it takes is a simple question "how did you support yourself for all that time?" and you're pretty much SOL.

Also....NEVER LIE ABOUT YOUR INCOME to the CRA.  If you do an they find out what you made (and they will), you'll get nailed with penalties, a possible criminal charge and you're essentially f*cked.

IF you can prove you were a non-resident, you'll be fine.  At worst, you'll owe money.  You will need to prove income and taxes paid (the forms can be found online through the NTS).  If you worked at a hogwan or were not registered properly, you may not only be liable for your taxes but if you cannot prove your income, CRA will use the average income for your employment (they are well aware of teaching in Korea) and assign a tax bill + penalties.

Good luck!

I got a letter saying I was a non resident from Revenue Canada after my first year here.  So, I assume that was proof enough plus the length of time gone.  (Will probably be over a decade.)  Also, I believe taxes can only go back 5 years.

So, these people who got hit, were they only in Korea for a year or two and never declared non residency? 


  • KimDuHan
  • Hero of Waygookistan

    • 1332

    • January 15, 2015, 11:48:59 am
    • Seoul
Re: Canadian government tax audit?
« Reply #6 on: April 11, 2016, 03:11:20 pm »
Sorry, I'm confused by the above post.

Why would Canadians owe money upon return to Canada? Unless they're in Korea for a 6 month gig, they're not Canadian residents and don't owe any money (from what I understand).

Why would they need to report their foreign earnings? Since they don't pay foreign (Canadian) taxes, it's frankly none of their (the CRA's) business.

Did tax laws change?

The CRA can audit you for about 5 or so years. I've heard of people applying for non residence for taxes and the government auditing  them immediately. Also applying as a non resident for tax purposes destroys your pension and other old age security options in Canada.

I'm not worried as I have student loan breaks and have not been to Canada in over 3 years and the prior 2 years I was a university student earning under $1000 a month.


Re: Canadian government tax audit?
« Reply #7 on: April 11, 2016, 03:23:44 pm »
Sorry, I'm confused by the above post.

Why would Canadians owe money upon return to Canada? Unless they're in Korea for a 6 month gig, they're not Canadian residents and don't owe any money (from what I understand).

Why would they need to report their foreign earnings? Since they don't pay foreign (Canadian) taxes, it's frankly none of their (the CRA's) business.

Did tax laws change?

The CRA can audit you for about 5 or so years. I've heard of people applying for non residence for taxes and the government auditing  them immediately. Also applying as a non resident for tax purposes destroys your pension and other old age security options in Canada.

I'm not worried as I have student loan breaks and have not been to Canada in over 3 years and the prior 2 years I was a university student earning under $1000 a month.

Not contributing to your Canada Pension Plan destroys it.  It' s a benefit based on your own contributions.  Being home and not working or being here and not paying into it makes no difference.  As for the Old Age Pension, that is defined by your residency in Canada and how many years you have  - a minimum of 20 years needed.  Canada and Korea have a pension treaty meaning you will be considered a resident of Canada while being a resident of Korea and as long as you're paying into pension here. 

Korea requires 10 years of payment before qualifying for a pension.  In Canada, you can pay even once to get something, though it will be very very small for the Canada Pension Plan (CPP).  If you are not paying into the Canada, pay into the Korean one, but get 10 years or cash out after 2 or 3 and go home.  You'll be fine so long as you pay into the CPP for the rest of your life. 


  • KoreaBoo
  • Expert Waygook

    • 582

    • May 25, 2014, 04:00:42 pm
    • Vancouver Island
Re: Canadian government tax audit?
« Reply #8 on: April 11, 2016, 03:30:28 pm »
Canadians are not legally obliged to file unless they owe CRA money.

If you've done what most Canadians here have done (kept their ties and residency in Canada and hoping they would not be caught by CRA when they returned) went back and got hit with a serious tax bill.

I've seen it happen.  I've watched people's savings evaporate instantly.  Unless you can prove you were not a resident in Canada, you will owe money.  I've met so many people here who thought they knew it all...got nailed and ended up with nothing.  All it takes is a simple question "how did you support yourself for all that time?" and you're pretty much SOL.

Also....NEVER LIE ABOUT YOUR INCOME to the CRA.  If you do an they find out what you made (and they will), you'll get nailed with penalties, a possible criminal charge and you're essentially f*cked.

IF you can prove you were a non-resident, you'll be fine.  At worst, you'll owe money.  You will need to prove income and taxes paid (the forms can be found online through the NTS).  If you worked at a hogwan or were not registered properly, you may not only be liable for your taxes but if you cannot prove your income, CRA will use the average income for your employment (they are well aware of teaching in Korea) and assign a tax bill + penalties.

Good luck!

I got a letter saying I was a non resident from Revenue Canada after my first year here.  So, I assume that was proof enough plus the length of time gone.  (Will probably be over a decade.)  Also, I believe taxes can only go back 5 years.

So, these people who got hit, were they only in Korea for a year or two and never declared non residency?

That form you received from Revenue Canada is NON-BINDING (as people often lie).  Your actual circumstances will be determined as they happened after you return. 


  • KoreaBoo
  • Expert Waygook

    • 582

    • May 25, 2014, 04:00:42 pm
    • Vancouver Island
Re: Canadian government tax audit?
« Reply #9 on: April 11, 2016, 03:33:53 pm »
Sorry, I'm confused by the above post.

Why would Canadians owe money upon return to Canada? Unless they're in Korea for a 6 month gig, they're not Canadian residents and don't owe any money (from what I understand).

Why would they need to report their foreign earnings? Since they don't pay foreign (Canadian) taxes, it's frankly none of their (the CRA's) business.

Did tax laws change?

The CRA can audit you for about 5 or so years. I've heard of people applying for non residence for taxes and the government auditing  them immediately. Also applying as a non resident for tax purposes destroys your pension and other old age security options in Canada.

I'm not worried as I have student loan breaks and have not been to Canada in over 3 years and the prior 2 years I was a university student earning under $1000 a month.


You need to be in country for 40 years after turning 18 to receive your full OAS benefits.  For those who are there a shorter period, the OAS is pro-rated.  In addition, you get an income supplement benefit to make up for any shortfall in income to will raise you to a minimum income level in old age.

Your last sentence had no bearing on your current circumstance.


Re: Canadian government tax audit?
« Reply #10 on: April 11, 2016, 04:57:52 pm »
http://english.nps.or.kr/jsppage/english/agreement/agreement_02_01_01.jsp

http://www.esdc.gc.ca/en/cpp/oas/eligibility.page

Paying into the Korean system and not cashing it out gives some credit for OAS.  Korean residency can count towards Canadian residency requirements.  CPP is only what you pay into it. 


Re: Canadian government tax audit?
« Reply #11 on: April 11, 2016, 05:00:57 pm »
Canadians are not legally obliged to file unless they owe CRA money.

If you've done what most Canadians here have done (kept their ties and residency in Canada and hoping they would not be caught by CRA when they returned) went back and got hit with a serious tax bill.

I've seen it happen.  I've watched people's savings evaporate instantly.  Unless you can prove you were not a resident in Canada, you will owe money.  I've met so many people here who thought they knew it all...got nailed and ended up with nothing.  All it takes is a simple question "how did you support yourself for all that time?" and you're pretty much SOL.

Also....NEVER LIE ABOUT YOUR INCOME to the CRA.  If you do an they find out what you made (and they will), you'll get nailed with penalties, a possible criminal charge and you're essentially f*cked.

IF you can prove you were a non-resident, you'll be fine.  At worst, you'll owe money.  You will need to prove income and taxes paid (the forms can be found online through the NTS).  If you worked at a hogwan or were not registered properly, you may not only be liable for your taxes but if you cannot prove your income, CRA will use the average income for your employment (they are well aware of teaching in Korea) and assign a tax bill + penalties.

Good luck!

I got a letter saying I was a non resident from Revenue Canada after my first year here.  So, I assume that was proof enough plus the length of time gone.  (Will probably be over a decade.)  Also, I believe taxes can only go back 5 years.

So, these people who got hit, were they only in Korea for a year or two and never declared non residency?

That form you received from Revenue Canada is NON-BINDING (as people often lie).  Your actual circumstances will be determined as they happened after you return.

If so, stay for 10 to 15 years and only have to go back 5 years.  Still cheaper than taxes in Canada.  :) 


  • stan rogers
  • Expert Waygook

    • 577

    • August 03, 2015, 04:16:11 am
    • Jeju Island
Re: Canadian government tax audit?
« Reply #12 on: April 11, 2016, 08:51:53 pm »
No taxation without representation.

If Canadian x-pats are not permitted to vote, they should not be permitted to pay taxes either.


  • KoreaBoo
  • Expert Waygook

    • 582

    • May 25, 2014, 04:00:42 pm
    • Vancouver Island
Re: Canadian government tax audit?
« Reply #13 on: April 11, 2016, 09:20:01 pm »
No taxation without representation.

If Canadian x-pats are not permitted to vote, they should not be permitted to pay taxes either.


I do have the right to vote and I exercise that right every election.

:P


  • Fanwarrior
  • Hero of Waygookistan

    • 1081

    • June 06, 2011, 09:19:35 pm
    • Seoul, South Korea
Re: Canadian government tax audit?
« Reply #14 on: April 11, 2016, 10:38:56 pm »
No taxation without representation.

If Canadian x-pats are not permitted to vote, they should not be permitted to pay taxes either.



I do have the right to vote and I exercise that right every election.

:P

The last election if you were out of the country more than 5 years, they did not allow you to vote.
« Last Edit: April 18, 2016, 07:48:09 am by Fanwarrior »