Government employees outside Canada

This page provides tax information to federal and provincial government employees who are posted abroad, as well as to members of their families.

Residency status

Government employees posted outside Canada are usually factual residents of Canada or deemed residents of Canada for income tax purposes.

Factual residents

You may be a factual resident of Canada for income tax purposes if you keep residential ties with Canada while living abroad.

  • The term factual resident means that although you are not in Canada, you are still considered a resident of Canada for income tax purposes.

If you are a factual resident and a resident of another country with which Canada has a tax treaty, you may be considered a deemed non-resident of Canada for income tax purposes.

Deemed residents

You may be a deemed resident of Canada for tax purposes if you have severed residential ties with Canada and you were:

  • a member of the Canadian Forces at any time in the tax year;
  • a member of the Canadian Forces overseas school staff and you choose to file an income tax return as a deemed resident of Canada. For more information on this choice, see Canadian Forces overseas school staff;
  • a federal or provincial government employee and you were either a resident of Canada just before being posted abroad or you received a representation allowance during the tax year;
  • a person working under a Canadian International Development Agency (CIDA) assistance program if you were a resident of Canada at any time during the three month period just before you began your duties abroad;
  • a person who, under an agreement or convention (including a tax treaty) between Canada and another country, is exempt from tax in that other country on 90% or more of their income from all sources because of their relationship to a resident (including a deemed resident) of Canada; or
  • a dependent child of someone who falls into one of the categories described above and your net income in 2016 was not more than $11,474 ($11,327 in 2015, $11,138 in 2014, $11,038 in 2013, $10,822 in 2012, $10,527 in 2011).

What are residential ties?

Residential ties may include:

Other ties that may be relevant include:

  • a Canadian driver's licence;
  • Canadian bank accounts or credit cards; and
  • health insurance with a Canadian province or territory.

For more information on residency status, see Income Tax Folio S5-F1-C1: Determining an Individual’s Residence Status.

If you want an opinion about your residency status, complete and send the Canada Revenue Agency Form NR73, Determination of Residency Status (Leaving Canada).

Your tax obligations

As a factual resident you:

  • must report your world income (income from all sources, both inside and outside Canada) for the entire tax year;
  • can claim all deductions, federal, provincial, or territorial non-refundable and refundable tax credits, that apply to you;
  • must pay federal tax;
  • must pay provincial or territorial tax for the province or territory where you keep residential ties; and
  • may be eligible for the GST/HST credit (goods and services tax/harmonized sales tax), the Canada child benefit.

For more information, see the General Income Tax and Benefit Guide.

As a deemed resident you:

  • must report your world income (income from all sources, both inside and outside Canada) for the entire tax year;
  • can claim all deductions and non-refundable tax credits that apply to you;
  • are subject to federal tax and instead of paying provincial or territorial tax you'll pay a federal surtax;
  • can claim all federal tax credits, but you cannot claim provincial or territorial tax credits; and
  • are eligible for the goods and services tax/harmonized sales tax (GST/HST) credit.

Which guide and forms book should you use?

If you are a factual resident, for the tax year you leave Canada and for all following years that you are outside Canada, use the General Income Tax and Benefit Package for the province or territory where you keep residential ties.

If you are a deemed resident, for the tax year you leave Canada and for all following years that you are outside Canada, use the General Income Tax and Benefit Package (for non-residents and deemed residents of Canada).

Filing due date

Generally, your income tax return must be filed on or before:

  • April 30 of the year after the tax year; or
  • if you or your spouse or common-law partner carried on a business in Canada (other than a business whose expenditures are mainly in connection with a tax shelter), the return must be filed on or before June 15 of the year after the tax year.

Note

A balance of tax owing must be paid on or before April 30 of the year after the tax year, regardless of the due date of the tax return.

Canada child benefit

If you are eligible to receive the Canada child benefit (CCB), you will continue to receive the CCB during your absence from Canada. However, to make sure your payments are not interrupted, you must file an income tax return for each year, so your CCB can be calculated.

Notes

If you have a spouse or common-law partner who is a factual or deemed resident, he or she must also file an income tax return each year.

If you have a spouse or common-law partner who is a non-resident, he or she will have to file Form CBT9, Canada Child Benefit - Statement of Income each year.

If you have a child while outside Canada, you can apply for the CCB for this child by sending the Canada Revenue Agency a completed Form RC66, Canada Child Benefits Application.

Canadian Forces overseas school staff

If you severed your residential ties with Canada, you became a non-resident of Canada for tax purposes on the date you left Canada. If this is your case:

However, you can choose to file your income tax return as a deemed resident of Canada while you are serving abroad. If you choose to do so:

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