(Quote from CRA)
Did you know?
Taxpayers who own specified foreign property costing more than $100,000 but less than $250,000 throughout the year can now file Form T1135, Foreign Income Verification Statement using a new simplified reporting method.
This simplified reporting method reduces your paperwork while allowing the CRA to continue to address international tax evasion and aggressive tax avoidance.
All Canadian resident taxpayers are required to file Form T1135, Foreign Income Verification Statement if, at any time in the year, the total cost of all specified foreign property to the taxpayer was more than $100,000 (Canadian).
The Government of Canada is committed to making it easier for you to meet your tax obligations. The CRA has revised the form to now include two parts: Part A features a simplified reporting method for taxpayers who held specified foreign property with a total cost of less than $250,000 throughout the year. This reporting method allows taxpayers to simply check a box for each type of property they held.
Part B continues to provide the detailed reporting method that taxpayers must use if they, at any time during a year, owned specified foreign property with a total cost of $250,000 or more.
Taxpayers who meet the criteria for completing Part A can still use the detailed reporting method in Part B if they wish.
Don’t forget to file your return and Form T1135 on time! Beginning with the 2013 tax year, the period for reassessing an income tax return is extended by three years if a taxpayer has failed to report income from a specified foreign property on their return and Form T1135 was not filed, was not filed on time, or was filed inaccurately.
For more information on Form T1135, go to Foreign Income Verification Statement, or read our questions and answers.
Fast facts for individuals about filing Form T1135 online:
•Launched earlier this year, you can now file Form T1135 online for the 2014 and subsequent tax years.
•Filing Form T1135 online is easy. Certified software and web applications (some of which are free to use) help you every step of the way.
•You can file Form T1135 online with your tax return or separately, but the filing deadline is the same for both.
•Filing online is secure. The CRA uses the same high level of online security as Canadian financial institutions.
•If you need to file Form T1135 for taxation years before 2014, you must file a paper form. Detailed instructions are written on the back of the form.
•We encourage all taxpayers to take advantage of the CRA’s Voluntary Disclosure Program when filing a Form T1135 for prior years.
Stay tuned—corporations and partnerships will be able to file Form T1135 online in the future. We’ll let you know when this service becomes available.
Read on to see how U.S. tax laws treat foreign property ownership, as well as the tax implications of selling the property.