This page provides information about the income tax rules that apply to non-residents of Canada.
On this page
- Residency status
- Your tax obligations
- Filing your income tax return
- Entitlements to benefits
Residency status
Non-residents
You are a non-resident for income tax purposes if you:
- normally, customarily, or routinely live in another country and are not considered a resident of Canada
- do not have significant residential ties in Canada and any of the following applies:
- You live outside Canada throughout the tax year
- You stay in Canada for less than 183 days in the tax year
Notes
If you lived outside Canada during the tax year and you are a government employee, a member of the Canadian Forces or their overseas school staff, or working under a Global Affairs Canada assistance program, seeGovernment employees outside Canadafor the rules that apply to you. These rules can also apply to your dependent children and other family members.
If you sojourned in Canada for183 daysor more(the183-dayrule) in the tax year, donothave significantresidential tieswith Canada,andarenot considered a resident of another country under the terms of atax treatybetween Canada and that country, seeDeemed residents of Canadafor the rules that apply to you.
Your tax obligations
As a non-resident of Canada, you pay tax on income you receive from sources in Canada. The type of tax you pay and the requirement to file an income tax return depend on the type of income you receive.
Generally, Canadian income received by a non-resident is subject to Part XIII tax or Part I tax.
Part XIII tax
Part XIII tax is deducted from the types of income listed below. To make sure the correct amount is deducted, it's important to tell Canadian payers:
- that you're a non-resident of Canada for income tax purposes
- your country of residence
The most common types of Canadian income subject to Part XIII tax are:
- dividends
- rental and royalty payments
- pension payments
- old age security pension
- Canada Pension Plan and Quebec Pension Plan benefits
- retiring allowances
- registered retirement savings plan payments
- registered retirement income fund payments
- annuity payments
- management fees
Notes
Generally, the interest that you receive or that is credited to you is exempt from Canadian withholding tax if the payer is unrelated (arm's length) to you. For more information, seethe Canada RevenueAgency'sNon-residenttax calculatoror contact theCanada Revenue Agency.
If you receive old age security pension during the tax year, you may have to file theOld Age Security Return of Income (OASRI)each year.
If you receive Canadian income that is subject to Part XIII tax:
- Canadian payers, including financial institutions, must deduct Part XIII tax when the income is paid or credited to you
- The Part XIII tax deducted is your final tax obligation to Canada on this income (if the correct amount is deducted)
- The usual Part XIII tax rate is 25% (unless a tax treaty between Canada and your home country reduces the rate)
- Part XIIItax is not refundable by way of filing a Canadian tax return. Therefore, do not file a Canadian tax return to report the income unless you elect to filea return because you receive either:
- Canadian rental income from real or immovable properties or timber royalties (seeGuide T4144, Income Tax Guide for Electing under Section 216)
- certain Canadian pension income (Electing under section 217)
For more information or If you think an incorrect amount of Part XIII tax has been deducted from your income,
contact the CRA.
Part I tax
The payer usually deducts Part I tax from the types of income listed below. However, if you carry on a business in Canada, or sell or transfer taxable Canadian property, you may have to pay an amount on account of tax:
- If you carry on a business in Canada, see Guide T4002, Self-employed Business, Professional, Commission, Farming, and Fishing Income, to find out if you must pay tax by instalments
- If you sell or transfer, or plan to sell or transfer taxable Canadian property, see Disposing of or acquiring certain Canadian property
Even if the payer deducts tax from your income or you pay an amount of tax during the year, you may also have to file a Canadian income tax return to calculate your final tax obligation to Canada on:
- income from employment in Canada or from a business carried on in Canada
- employment income from a Canadian resident for your employment in another country if, under the terms of a tax treaty between Canada and your country of residence, the income is exempt from tax in your country of residence
- certain income from employment outside Canada, if you were a resident of Canada when the duties were performed
- taxable part of Canadian scholarships, fellowships, bursaries, and research grants
- taxable capital gains from Disposing of certain Canadian property
- income from providing services in Canada other than in the course of regular and continuous employment
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Example
You live permanently in England. During the year, you received interest income from your bank account in England and business income from a permanent establishment in Canada.
As a non-resident of Canada, you will file a Canadian return for the year to report only your business income from Canada. You will not report the interest income from your bank account in England on your Canadian return.
Disposing of certain Canadian property
For the procedures you must follow if you sell or transfer, or plan to sell or transfer taxable Canadian property (such as real estate, business property, or unlisted shares of a Canadian corporation), see Disposing of or acquiring certainCanadian property.
Electing to file
There are two situations in which you can elect to file a Canadian income tax return for income from which Part XIII taxwas deducted:
- when you receive Canadian rental income from real or immovable properties or timber royalties
- when you receive certain Canadian pension income
If you elect to file a Canadian income tax return, you may be able to claim a refund for part or all of the Part XIII tax deducted.
For more information:
- on electing to file for Canadian rental income from real or immovable properties or timber royalties, see the Guide T4144, Income Tax Guide for Electing under Section 216
- on electing to file for certain Canadian pensions, see Electing under section 217
Filing your income tax return
You must file a Canadian income tax return if you:
- have to pay tax
- want to claim a refund
For more information, see Do you have to file a return?
When completing your tax return:
- You may be entitled to claim certain deductions or credits
- Do not include income that has had Part XIII tax deducted, unless you elect to file
Note
If you receive Canadian rental income or timber royaltiesandyou elect to file, you must report this income on a separate tax return, but you donotinclude any other type of Canadian income on this separate return. In this situation, you could file more than one Canadian tax return in a tax year:
- one for the rental income from real or immovable properties or timber royalties
- one for any other type of Canadian income that you receive
Which income tax package should you use?
The type of Canadian income you receive during the tax year determines which income tax package you should use.
If you receive only income from employment or business use the income tax package for the province or territory where you earn the income along with Guide T4058, Non-Residents and Income Tax. However, if you alsoreceive other types of income (capital gains and/or taxable scholarships, fellowships, bursaries, or research grants), you will also need Form T2203, Provincial and Territorial Taxes for Multiple Jurisdictions.
If you receive only other types of taxable Canadian-source income (such asscholarships, fellowships, bursaries, or research grants, capital gains, or from a business with no permanent establishment in Canada), use the Income Tax Package for Non-Residents and Deemed Residents of Canada.
Due to international mail delays, the CRA is temporarily accepting non-resident income tax returns through fax. You can fax your return to the tax centre applicable to your country of residence.
Filing due date
Your tax return has to be filed on or before:
- April30 of the year after the taxyear
- June15 of the year after the tax year, if you or your spouse or common-law partner carried on a business in Canada (other than a business whose expenditures are mainly in connection with a taxshelter)
Note
A balance of tax owing must be paidon or beforeApril 30of the year after the tax year, regardless of the due date of the tax return.
Entitlements to benefits
Canada childbenefit
As a non-resident, you are not eligible to receive the Canada childbenefit (CCB) unless you are the spouse or common-law partner of a deemed resident and you meet the CCB eligibility requirements.
Forms and publications
- Income Tax Package for Non-Residents and Deemed Residents of Canada
- Guide T4058, Non-Residents and Income Tax
- Income Tax Folio S5-F1-C1, Determining an Individual's Residence Status
Residential ties
The 183-day rule
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