How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask Legal Ease Your Own Question

Legal Ease
Legal Ease, Lawyer
Category: Canada Tax
Satisfied Customers: 87304
Experience:  Lawyer
10263656
Type Your Canada Tax Question Here...
Legal Ease is online now
A new question is answered every 9 seconds

Question on withholding in Canada on pensions paid to a UK

Customer Question

Question on withholding in Canada on pensions paid to a UK resident.

I have been a UK resident since the beginning of October 2011. I will be receiving pension income in the UK paid from Canada.

My interpretation of the treaties between the UK and Canada is that pension income is taxable only in the country of residence. In my case, this will be the UK for future years.

The other interpretation is that the withholding taxes in Canada for pension income for UK residents should be 0%.

I am looking for a little guidance on the above understanding. And some advice on what I need to do to ensure the withholding tax is taken off in Canada correctly.
Submitted: 2 years ago.
Category: Canada Tax
Expert:  Danielle-Mod replied 2 years ago.

Hi, I’m a moderator for this topic and I wonder whether you’re still waiting for an answer. If you are, please let me know and I will do my best to find an Expert to assist you right away. If not, feel free to let me know and I will cancel this question for you. Thank you!

Customer: replied 2 years ago.

Thanks Danielle. I am still waiting. Experts might come from two sources. The first is Canadian expert who knows something about UK taxes. The second is UK expert who knows something about Canadian taxes.

XXXXX XXXXXon

Expert:  Danielle-Mod replied 2 years ago.

Sometimes, finding the right Expert can take a little longer than expected and we thank you greatly for your understanding. We’ll be in touch again shortly.

Expert:  Legal Ease replied 2 years ago.
The question just appeared on the Canada law list now.

I am happy to help but I only know about Canadian laws.

There are not experts on our list that can anwer abou the UK aspects and there is are no UK experts that can answer about the Canadian issues.

Would you like for me to answer abou the Canadian part of your question?
Customer: replied 2 years ago.

Sure Debra, the Canadian side is at least half of the equation.

 

Please do let me know your answer. I appreciate that it is not legally binding.

 

In replying, would you please refer to specifc guides, bulletins or treaties I could find on the CRA website? The numbers will be fine; I can do the actual search.

Expert:  Legal Ease replied 2 years ago.
OK

I have one more question first.

Are you still considered to be a resident of Canada or did you sever all ties?

What type of pension is this? For example is this CPP or a private pension from a former employer?
Customer: replied 2 years ago.

Answers on resident of Canada

  1. I left Canada at the beginning of October 2011, to retire with my wife in the UK.
  2. I have mailed in a NR73 form to check on status and am awaiting a reply.
  3. I have no residence in Canada nor dependents, but do have a bank account.
  4. I am assuming that I will be eventually be classified as non-resident. That was the assumption of the question.
  5. For 2011 tax year, I will file a Canadian tax return. The question is for future years after determining the residency status.

Type of Pension

  1. RIF income adminstered in Canada with quarterly payments. Quarterly seems to qualify as periodic. The RIF is the subject of the question.
  2. I also have CPP and OAS income. The literature on these points to 0% withholding. However, that is only what I read.
Expert:  Legal Ease replied 2 years ago.
Sorry for the delay in replying. For some reason I didn't get a notice that you had replied to me.

The answer is that there will be a withholding tax on these periodic payments. This will apply to the RIF, OAS and CPP.

So once you are deemed to be a non-resident the withholding tax will be applied but there will not be any need to file a return anymore.

If there is just one bank account and you are not keeping up your health insurance coverage or having a cottage that is not being sold you should not have a problem being designated as a non-resident.

For 2011 you should prepare 2011 tax return including income up to date of departure and include a departure tax.

I hope that helps but let me know if there are any follow-up questions.

Thanks
Legal Ease, Lawyer
Category: Canada Tax
Satisfied Customers: 87304
Experience: Lawyer
Legal Ease and other Canada Tax Specialists are ready to help you
Expert:  Legal Ease replied 2 years ago.
I received your feedback.

Please do not hesitate to post back to this response when you have additional questions rather than just putting that into the feedback.

Here is a link that gives you the information that you need on the CRA website:

http://www.cra-arc.gc.ca/tx/nnrsdnts/ndvdls/lvng-eng.html

The withholding tax is usually 25% unless your country has a treaty with Canada that reduces the amount.

This is discussed here:

http://www.servicecanada.gc.ca/eng/isp/pub/nontax.shtml

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Arthur Rubin

    Tax Preparer

    Satisfied Customers:

    22
    Tax preparer with 23 years experience, including US/Canada tax returns.
< Last | Next >
  • http://ww2.justanswer.com/uploads/AR/arubin9/2012-2-4_42617_ArthurRubinedit.64x64.jpg Arthur Rubin's Avatar

    Arthur Rubin

    Tax Preparer

    Satisfied Customers:

    22
    Tax preparer with 23 years experience, including US/Canada tax returns.
  • http://ww2.justanswer.com/uploads/KU/KUMI95/2013-9-30_195031_kumar.64x64.jpg Wallstreet Esq.'s Avatar

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    572
    10 years experience
  • http://ww2.justanswer.com/uploads/CU/Cuttinggirl/2011-10-29_03719_wcrop2.64x64.jpg Wendy Reed's Avatar

    Wendy Reed

    Enrolled Agent

    Satisfied Customers:

    3053
    15+ years tax preparation and tax advice.
  • http://ww2.justanswer.com/uploads/CATax/2009-08-04_204548_Mark.jpg Mark D's Avatar

    Mark D

    Enrolled Agent

    Satisfied Customers:

    985
    MBA, EA, Specializing in Business and Individual Tax Returns and Issues
  • http://ww2.justanswer.com/uploads/IN/insearchoftheanswer/2013-8-16_0233_attorney.64x64.jpg Richard's Avatar

    Richard

    Tax Attorney

    Satisfied Customers:

    3277
    29 years of experience as a tax, real estate, and business attorney.
  • http://ww2.justanswer.com/uploads/MY/MyVirtualCPA/2012-7-5_44024_cookmegan1.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    8219
    Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
 
 
 

Related Canada Tax Questions

Chat Now With A Canadian Tax Expert
Legal Ease
Legal Ease
Canadian Tax Expert
87304 Satisfied Customers
Lawyer