Residence Determinations: Canadian Tax Lawyer's Guide

What is Canadian Tax Residence?

There are two types of residence for taxpayers; their immigration residence and their tax residence. A taxpayer can be resident of one country for immigration purposes and resident of an entirely different country for tax purposes. In determining whether an individual is a tax resident of Canada, his or her residential ties to Canada are considered. None of these factors are individually determinative but are instead weighed together to determine residence.

The primary factors, those that have more weight in the determination of an individual's residence, are: home in Canada, spouse or common-law partner in Canada and dependents in Canada. Secondary factors include driver's license in Canada, maintaining a Canadian passport, bank accounts in Canada and social ties to Canada. Canada additionally has a number of tax treaties which contain "tie-breaker" rules for residence when a taxpayer is considered a tax resident of both countries.