Foreign Property Tax Preparation
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As a Canadian resident, the government taxes your worldwide income, not just the income you earn in Canada. To make sure all Canadian residents who have worldwide income report it to the Canada Revenue Agency, they are required to fill out Form T1135, the Foreign Income Verification Statement. Not correctly reporting foreign income can result in significant fines and even criminal sanctions.
At Softron Tax, we have years of experience in foreign property reporting and will ensure all our customers who have foreign income will have it filed properly to the CRA to avoid stiff penalties. We provide assistance by phone, fax or email for your convenience.
Revised T1135 Foreign Property Verification Statement
In 2013, the Federal Government revised the T1135 Foreign Property Verification Statement to combat the ongoing problem of international tax evasion and tax-avoidance as part of the government’s 2013 Economic Action Plan.
The criteria for filling out form T1135 have not changed (Canadian taxpayers who hold specified foreign property with a cost amount of over $100,000, at any time in the taxation year); however what has changed is that the revised form requires more detailed information on your foreign property than before.
What Specified Foreign Property must be reported to the CRA?
- Funds held outside Canada;
- Shares of non-resident corporations (other than foreign affiliates);
- Indebtedness owed by non-residents (other than from foreign affiliates);
- Interests in certain non-resident trusts;
- Real property situated outside Canada (other than personal use property and real property used in an active business);
- Other types of foreign property such as intangible property not used in a business and certain rights under contract.
Is there any other additional information I need to provide?
- Identify the country code that is applicable for each specified foreign property;
- The maximum and year-end cost amounts of the property;
- The income or loss of the property;
- The capital gain realized from each property during the taxation year.
What if I haven't filed my Foreign Property Verification Income in past years?
If you haven’t filled out your Foreign Property Verification income form in past years, the CRA has implemented a voluntary disclosure program, to encourage Canadian residents to come forward and get caught up with their filings and avoid receiving harsh penalties from the CRA.
For further questions on foreign property reporting call Softron at (905) 273-4444 or to learn more.