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I have a similar situation to a question asked May 9th and would like to ask for best course of action for the specific case to correct the situation.
(1) Left Canada in 1999 on a TN visa to work in the US. After one year was converted to H1B VISA. Obtained Green Card and then became a US Citizen few years later. This person was just out of school and did not know any better and did not file a departure form.
(2) During his absence from Canada, his father added his name to some of his GICs and wrongly filled his tax return as a resident all these years for the interest income. The GIC was all his father's money, and with the exception some RRSP investments, he has no bank account in Canada. The GIC deposit was made by this father without his involvement.
(3) He is co-owner of a house (primary residence before he left Canada) and they are now thinking of transfer or selling the house. This brought up the issue. How can this be handled in his situation.
Couple specific questions:
(a) Does the 10 year limitation apply on adjustments
(b) There is a similar limitation in the US, do you know if it apply if the situation is corrected in Canada?
(c) are there any legal issues?
Thank you.
Hi Mary,
Thank you for your detailed message. Your situation is a common one, and the good news is that CRA does allow us to correct past records even after many years have passed. Here’s what I recommend:
1. Filing a Late Emigrant Return
Even though your departure was in 1999, CRA will still accept a late-filed “emigrant return” to formally establish your departure date. While CRA generally will not issue refunds for tax years more than 10 years old, they will process the return and update your residency status in their records.
This step is important because it:
- Confirms that you were a Canadian tax resident only until May 1999.
- Crystallizes your principal residence exemption as of your departure date (important for when you sell or transfer the house).
- Avoids unnecessary taxation on worldwide income after 1999.
2. NR73 Residency Determination Form
Form NR73 (Determination of Residency Status) is optional and not required if you are confident of your departure date. It is best used only if:
- CRA challenges your departure date, or
- You want written confirmation from CRA before reporting a future property sale.
Otherwise, filing the late emigrant return is usually sufficient, and it is considered the primary way of reporting your change of status.
3. Adjusting Past Income
If interest from the GICs was incorrectly reported under your SIN after 1999, we can file adjustment requests (T1-ADJ) to remove that income from your past returns. CRA generally accepts such adjustments beyond 10 years when they result in a lower tax liability, even if they do not issue refunds for older years.
4. Next Steps
I recommend the following approach:
- Prepare and file your 1999 emigrant return with a May 1999 departure date.
- Prepare supporting documentation (e.g., TN visa, H1B, green card, lease/employment proof) to demonstrate that you severed Canadian residency in 1999.
- File adjustments to remove post-1999 Canadian interest income reported in error.
- Review your co-ownership of the house to ensure the principal residence exemption is applied correctly up to your departure date.
You can book a 30-minute paid consultation ($140 + HST) directly at:
https://madanca.com/contact-us
I look forward to helping you get this resolved and bringing your records fully up to date.