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In: Accounting

At the end of the current year, Mr. Ryder departed from Canada in order to take...

At the end of the current year, Mr. Ryder departed from Canada in order to take a permanent position in Germany. He was accompanied by his common-law partner and their children, as well as what personal property he had not sold. Due to the intent of his neighbour to start a pig farm, he was unable to sell his residence at a satisfactory price. However, he was able to rent it for a period of two years. He also retained his membership in the CPA (Chartered Professional Accountants) Alberta.

After his departure, would he still be considered a Canadian resident for tax purposes? Explain your conclusion in point form.

Solutions

Expert Solution

As Mr. Ryder departed from canada in order to take permanent position in Germany at the end of the year. He was accompnied by his commom law partner and their children as well. As he has severed sufficient residential ties to canada during the year as he has :

a home in canada during the year

a common law partner in canada during the year

dependents in candana during the year.

Further he has secondry residential ties as well as he has :

a) economic ties in canada beacuse he holds CPA

b) residential home in canada

c) social ties in canada as he connects with neighbours

So he will be considered Resident for tax puposes for Current year as he has Factual residendial status in canada.He is resident for complete year as he leaves Canada at the end of the year so Income from worldwide sources will be liable to tax in canada

Further, in following year his residential status will be ceased as the end of year because he :

a) he leaves canada

b) his dependent children and common law partner leaves canada

c) he became a permanent resident of Germany

But still, he has rental income from his house in Canada through his neighbour that signifies his economical and social ties in canada. Further he holds CPA also. In that case, Income earned in Canada only will be taxable in Canada. So his income be taxable in canada if and only if it is earned through Canadian source.

ekkarill92 answered 1 year ago
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