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Written by: Dagmar Zanic, CPA, CA
Do you believe that the obligation to file a Form T1135 is something only wealthy individuals are subject to? Willing to wager that you won’t be subject to a penalty of $2,500 for each year you missed filing a Form T1135 if you are wrong?
The list of situations that might subject an individual to have to file a Form T1135 is extensive. Below, we list a few of the most common situations that many taxpayers are often unaware of:
- Shares of non-Canadian companies in an investment portfolio (i.e., Disney, Microsoft, Starbucks) held in a Canadian brokerage account.
- U.S. bank accounts (most commonly used to pay for online purchases across the border).
- Real property located outside of Canada (most commonly rental properties).
The requirement to file a Form T1135 applies if, at any time during the year, an individual owns a specified foreign property costing more than $100,000 ($250,000 after 2014). The obligation to file a Form T1135 with your income tax return has existed for over 10 years. If an individual were to have missed filing a Form T1135 in the past, they might be able to file them under the Voluntary Disclosure Program – and avoid significant late-filing penalties.
Don’t gamble with your tax filings. Contact a member of Manning Elliott's tax team to ensure that you have not exposed yourself to potential penalties or to assist you with rectifying any past omissions.
Dagmar Zanic, CPA, CA is a Senior Tax Manager and member of Manning Elliott's tax team. She advises our individual and corporate clients on a wide range of income tax planning and tax compliance matters. To contact Dagmar, feel free to call her at 604-714-3640 or email her at firstname.lastname@example.org
The above content is believed to be accurate as of the date of posting. Tax laws are complex and are subject to frequent changes. Professional advice should be sought before implementing any tax planning. Manning Elliott LLP cannot accept any liability for the tax consequences that may result from acting based on the information contained therein.