Canadian Money Forum banner

1 - 6 of 6 Posts

·
Registered
Joined
·
2 Posts
Discussion Starter #1 (Edited)
Are Social security benefits from outside Canada a part of "World net income"?

Hello,

I help an ill friend with Canadian Income Tax and Benefit Return.
She can't do it and she can't afford some expert to do it, because her income is very low.

She is a resident in Slovakia (non-resident of Canada).
She has only two incomes:
1. Canada Pension Plan - Disability Benefits (NR4 slips) => only about 3.000CAD/year
2. social security benefits from Slovakia => only about 10.000CAD/year

Point 2 is not taxable income in Canada according to tax treaty with Slovakia (article 18, point 5):
b) social security benefits paid by a Contracting State or a political subdivision thereof to a resident of the other Contracting State shall be taxable only in the first-mentioned State.

My question:
Can I omit point 2. from Income Tax and Benefit Return at all?
Or do I have to put it in "Statement of World Income"? If yes, then where/how should I put it, because I don't see any other field where to put equivalent deduction (because this income is surely not taxable).

Thanks in advance,
Jakub
 

·
Registered
Joined
·
160 Posts
I think you need to show it. Whether or not it gets taxed in Canada depends on if Canada has treaty with the other country. My wife gets a UK pension that is not taxed in the UK and the money is included in her overall taxable income in Canada

https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/personal-income/line-11500-other-pensions-superannuation/line-11500-pensions-a-foreign-country/questions-answers-about-line-11500-pensions-a-foreign-country.html
 

·
Registered
Joined
·
3,083 Posts
You put it in "Statement of World Income". This is not taxable but if her world income is less than some amount, it might create tax credits that will help her. At least this is my understanding based on my quick reading of the non-resident tax return. If you read the guide (first link at the webpage linked below) it mentions that foreign pension income is only taxable for deemed residents of Canada (which she is not).

https://www.canada.ca/en/revenue-agency/services/forms-publications/tax-packages-years/general-income-tax-benefit-package/non-residents.html
 

·
Registered
Joined
·
2 Posts
Discussion Starter #5
Thanks for all replies. Yes, it's not taxable (not in Step 2. Step 3. Step 4), so also it can't go to line 25600 as deduction.
It just somehow affects taxable income (line 38) and tax deductions (lines 49 and 64) if electing under section 217 and that's what confused me. But electing under this section is optional so I will probably skip it.
 

·
Registered
Joined
·
1 Posts
Are Social security benefits from outside Canada a part of "World net income"?

Hello,

I help an ill friend with Canadian Income Tax and Benefit Return.
She can't do it and she can't afford some expert to do it, because her income is very low.

She is a resident in Slovakia (non-resident of Canada).
She has only two incomes:
1. Canada Pension Plan - Disability Benefits (NR4 slips) => only about 3.000CAD/year
2. social security benefits from Slovakia => only about 10.000CAD/year
Here from company Your Books On Time.
Point 2 is not taxable income in Canada according to tax treaty with Slovakia (article 18, point 5):
b) social security benefits paid by a Contracting State or a political subdivision thereof to a resident of the other Contracting State shall be taxable only in the first-mentioned State.

My question:
Can I omit point 2. from Income Tax and Benefit Return at all?
Or do I have to put it in "Statement of World Income"? If yes, then where/how should I put it, because I don't see any other field where to put equivalent deduction (because this income is surely not taxable).

Thanks in advance,
Jakub

how was the issue resolved?
 
1 - 6 of 6 Posts
Top