Cases
The Queen v. Taylor, 91 DTC 5131 (FCA)
In 1983 a resident of California paid $325,226 in foreign non-business income taxes, became a resident of Canada on November 1, 1983, and earned $8,600 in interest and rental income for the balance of 1983. Because section 114 effectively deemed the January-October period to be a separate taxation year from the November-December period, the non-business income taxes for the January-October period were not deductible from her income for the November-December period.
The Queen v. Bergelt, 86 DTC 6063, [1986] 1 CTC 212 (FCTD)
The taxpayer ceased to be a resident of Canada in September 1980 when he moved to California to work as a senior controller with a U.S. company ("Daon"), notwithstanding that (1) his wife remained behind in Vancouver in order that she could supervise the completion of renovation work on their Vancouver home before its intended sale, (2) his U.S. pay cheque was deposited to a Canadian bank account, and (3) in November and December of 1980 he made several trips to Vancouver before deciding in mid-December to accept an offer of Daon's Canadian parent of a position in Canada.
Griffiths v. The Queen, 78 DTC 6286, [1978] CTC 372 (FCTD)
A retired Canadian executive who amicably separated from his wife and moved to a Carribean island in order to live in, and sail, his yacht, thereupon ceased to be a resident of Canada, notwithstanding that he retained substantial investments in Canada and made occasional visits there.
Beament v. MNR, 52 DTC 1183, [1952] CTC 327, [1952] 2 S.C.R. 486
On the outbreak of the Second World War, the taxpayer, before going for service overseas, ceased renting a room in his parents' house, and stored his belongings in a storage room in their house. While in the United Kingdom he married an Englishwoman and maintained a matrimonial home there, Cartwright J. held that the taxpayer was not resident or ordinarily resident in Canada during the portion of 1946 prior to the taxpayer's return to Canada notwithstanding what may have been a continuing intention on the part of the taxpayer to return to Canada.
See Also
Grant v. The Queen, 2006 DTC 3071, 2006 TCC 373, aff'd 2007 DTC 5351, 2007 FCA 174
On December 24, 1998, the taxpayers borrowed an aggregate of approximately U.S.$1 billion from the CIBC, and lent the same sum to a U.S. subsidiary of the CIBC ("CIHI"), with the notes from CIHI being pledged to secure the borrowing from CIBC. The taxpayers ceased to be resident of Canada on December 30 1998, on December 31, 1998, the taxpayers paid accrued interest on the CIBC borrowing using the proceeds of a bridge loan, and early in 1999 the CIBC borrowing was repaid from the proceeds of repayment of the CIHI notes. In rejecting a submission on behalf of the taxpayers that 6/7 of the interest paid by them on December 31 was reasonably attributable to a period of Canadian residence and, therefore, could be deducted under s. 114(c), Woods J. found that s. 114(c) was restricted to deductions that were specifically allowed in computing taxable income, and noted that the effect of the above submission was that taxpayers would be able to claim interest deductions on a cash basis under s. 114(a) or on a accrual basis under s. 114(c) and that cash basis taxpayer (such as the taxpayers before her) could claim interest expense on an accrual basis and yet report the related interest income on a cash basis.
Administrative Policy
27 March 2013 Folio S5-F1-C1
The date upon which a Canadian resident individual leaving Canada will become a non-resident ... will usually coincide with the latest of the dates on which:
- the individual leaves Canada;
- the individual's spouse or common law partner and/or dependants leave Canada (if applicable); or
- the individual becomes a resident of the country to which he or she is immigrating.
An exception to this will occur where the individual was resident in another country prior to entering Canada and is leaving to re-establish his or her residence in that country. In this case, the individual will generally become a non-resident on the date he or she leaves Canada, even if, for example, the individual's spouse or common law partner remains temporarily behind in Canada to dispose of their dwelling place in Canada or so that their dependants may complete a school year already in progress.
85 C.R. - Q.20
A non-resident, who is a member of a partnership not carrying on business in Canada, will be taxed under Part I for his share of the income of the partnership for fiscal periods that ended after he became a resident.
84 C.R. - Q.35
A non-resident who only occasionally visits Canada to perform directorship duties will not thereby be considered to be employed in Canada throughout the period after he left Canada.
Articles
Christine Hung, "Taxation of an Immigrating Partner's Income from a Foreign Partnership in the Year of Immigration", Canadian Current Tax, Vol. 9, No. 9, June 1999 [9]
"The immigrant partner is required to include in his or her income for Canadian tax purposes only that part of the foreign partnership income earned by the partnership after the partner has immigrated to Canada."