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Hi, I am a Canadian citizen living in Canada , my uncle is a chinese national living in Hong Kong and he is sending me a wire transfer of $800,000 as a gift to my canadian bank account. Will there be any issue with CRA Tax department , do I need to pay any taxes on this gift cash? Do I need to proof that it is a gift and how do I do that?
Hi Kim, you will not have to pay Canadian income tax on the gift received. Gifts are non-taxable to the recipient in Canada. A gift letter needs to be prepared and notarized by a lawyer. The gift letter should contain these facts:
1. Name of giver
2. Name of recipient
3. Amount of gift
4. Date of gift
5. Nature of gift (cash)
6. The amount is a gift and not repayable