Residency status determination

Residency status and tax obligations

In Canada, your income tax obligations are based on your residency status, not your citizenship or immigration status. You are responsible for determining your residency status and understanding your tax obligations. You need to know your residency status before you can know your tax responsibilities and filing requirements for Canada. Learn more about your tax obligations.

If you need help to determine your residency status for tax purposes, you can complete form NR74 Determination of Residency Status (entering Canada) or NR73 Determination of Residency Status (leaving Canada) and send it to the International tax and non-resident enquiries office to receive an opinion from the CRA about your residency status.

Residency status and film and media tax credits

The Canada Revenue Agency (CRA) administers film and media tax credits for the federal government and the provinces of British Columbia, Ontario and Manitoba. These tax credits are generally based on qualifying labour expenditures paid by corporations to their employees and other qualifying individuals who are residents of Canada.

Salaries and remuneration paid to residents of Canada, for the purposes of film and media tax credits, include factual residents and deemed residents.

Non-residents, and deemed non-residents (individuals who are considered residents of another country under the terms of a tax treaty between Canada and that country), generally do not qualify.

Factual residents

Individuals who have established significant residential ties to Canada. They are subject to Canadian and provincial or territorial income tax on worldwide income during the part of the year that they were a factual resident. Learn more about factual residents.

Salaries and remuneration paid to factual residents may qualify for the federal and provincial film and media tax credits.

Deemed residents

Individuals who have not established significant residential ties to Canada but were in Canada for 183 days or more in a calendar year. They are subject to Canadian income tax on worldwide income throughout the year and are subject to a federal surtax instead of provincial or territorial tax. Learn more about deemed residents.

Salaries and remuneration paid to deemed residents of Canada may qualify for the federal film and media tax credits only. They do not qualify for the provincial film and media tax credits.

Non-residents

Individuals who have not established significant residential ties to Canada and were in Canada for less than 183 days in a calendar year. They are subject to Canadian tax on income from Canadian sources, unless exempted by a treaty provision. They are also subject to provincial or territorial tax if they earned income from a business with a permanent establishment in Canada. Learn more about non-residents.

Salaries and remuneration paid to non-residents do not qualify for any federal or provincial film and media tax credits.

Deemed non-residents

Individuals who would otherwise be considered as factual or deemed residents but are considered to be a resident of another country under an income tax treaty between Canada and that country. They are subject to Canadian tax on their income from Canadian sources, unless exempted by a treaty provision. They are also subject to provincial or territorial tax if they have earned income from a business with a permanent establishment in Canada. Learn more about non-residents. (Note that tax obligations for deemed non-residents are the same as for non-residents).

Salaries and remuneration paid to deemed non-residents do not qualify for any federal or provincial film and media tax credits.

International workers, dual residents and international tax treaties

Canada has income tax treaties with other countries to avoid double taxation. If you are a resident of two countries, including Canada and a country that Canada has an income tax treaty with, the CRA will look at the terms of that treaty to determine which country you are considered to be a resident of for tax purposes.

Individuals can be residents for tax purposes in more than one country at the same time. In such cases, where there is a tax treaty between Canada and the other country, individuals will be considered residents where they have the strongest social and economic ties.

For example, Canada has a tax treaty with the United States (U.S.). Individuals who are considered residents of both Canada and the U.S. will be considered residents for tax purposes in the country in which they have established the strongest ties. If they have stronger ties to the U.S., they will be deemed non-residents in Canada for tax purposes and their salary and remuneration will not qualify for federal or provincial/territorial film and media tax credits.

A work permit indicates a temporary stay in Canada, but is not conclusive for determining residency for tax purposes. The residency status of each individual is reviewed independently, on an annual basis, and is based on the facts and information made available to the CRA at the time of an audit.

Residency guidelines for film and media tax credits – List of documents

The CRA considers the documents listed below to be evidence of significant residential ties to Canada. However, the CRA may ask for more information as outlined in Income Tax folio S5-F1-C1 to support the residency status of an individual in Canada. All documents sent to the CRA are subject to verification, especially in situations where there is dual residency and an income tax treaty applies.

The CRA requires a copy of any one of the following documents to support residency status.

If none of the above documents are available, the CRA requires a copy of three of the following documents to support residency status.

  • Copy of the last income tax return filed in the country of origin and/or any document filed with the foreign tax authority in which the individual has declared that they are no longer a resident.
  • Short-term (less than a year) lease agreement or letter from a landlord supporting a rental agreement.
  • Provincial/territorial health or services card for the individual, their spouse and/or dependant.
  • Driver's licence or vehicle registration from the relevant province/territoryFootnote *.
  • Professional association or union membership in Canada.
  • Statements of accounts (for example, bank accounts, retirement savings plan, credit cards, securities accounts) from a Canadian branch of a financial institution.

Learn more about significant residential ties.

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