You become a resident of Canada for income tax purposes when you establish significant residential ties in Canada. You usually establish these ties on the date you arrive in Canada.
When should you apply to receive benefits and credits?
Apply right away to get benefits and credits you may be entitled to.
To get these benefits and credits, you or your spouse or common-law partner must be one of the following:
- a permanent resident, even with a temporary address
- a protected person
As soon as you get your social insurance number, apply for benefits. If you are a temporary resident, you must live in Canada for 18 months in a row and have a valid permit on your 19th month of living in Canada before you can apply for the Canada child benefit and any related provincial and territorial programs.
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Some of the benefits and Credits that you may be entitled to are.
- Canada Child Benefits
- GST/HST Credits
- Trillium Benefits
To continue receiving the benefit and credit payments that you are entitled to, you have to file your income tax and benefit return on time every year, even if you have no income in the year. If you have a spouse or common-law partner, they also have to file a return every year.
Property you owned before you arrived in Canada
If you owned certain properties (other than taxable Canadian properties) at the time you immigrated to Canada, the CRA considers you to have sold the properties and to have immediately reacquired them at a cost equal to their fair market value (FMV) on the date you became a resident of Canada. This is a deemed disposition.
Your property could include items such as shares, jewelry, paintings or a collection.
Usually, the FMV is the highest dollar value you can get for your property in a normal business transaction.
You should keep a record of the FMV of your properties on the date you arrived in Canada. The FMV will be your cost when you calculate your gain or loss from disposing the property in the future.
You dispose of your property when, for example:
- You sell it
- You give it
- It is destroyed
- It is stolen
If you have a loss resulting from the disposition of those properties, you can only deduct those losses from any gains you had from selling the same type of property. You cannot use this type of loss to reduce any capital gains you had from selling other types of properties.
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