3/11/2013

CRA Foreign Tax Withholding --- NR301

 

Who should complete the Canadian tax form(s)?

 

You should complete the form(s) if you are a non-Canadian taxpayer, reside in a country Canada has a

tax treaty with, and are eligible to receive the reduced tax rate provided for by the treaty. Please contact the Canada Revenue Agency (CRA) directly, or go to its website at www.cra-arc.gc.ca, for moreinformation about specific eligibility requirements for receiving the reduced withholding rate.

 

Why do I need to complete the tax form(s)?

 

If you are not a resident of Canada but receive Canadian-sourced income payments, we are required to withhold tax from those payments and remit those taxes to the Canada Revenue Agency (CRA). If we have the  appropriate tax forms on file for your account(s), we may be able to apply a reduced withholding rate to those payments. Otherwise, we will need to withhold taxes at the full statutory tax rate of 25%.

 

Why are these forms needed now?

 

Previously, your name and address information in our files allowed us to apply a reduced withholding rate to your Canadian-sourced income payments. Under new regulations, we need to have the appropriate form on file in order for you to be eligible for the reduced rate. 

 

How long is the form valid?

 

For tax withholding purposes, the NR forms expire when there is a change in your eligibility for treaty benefits or three years from the end of the calendar year in which the form is signed and dated, whichever is earlier.

 

Definition of 'Back-End Load'

A fee (sales charge or load) that investors pay when selling mutual fund shares within a specified number of years, usually five to 10 years. The fee amounts to a percentage of the value of the share being sold. The fee percentage is highest in the first year and decreases yearly until the specified holding period ends, at which time it drops to zero. 

The back-end load is a type of sales charge that is used with mutual funds that have share classes, which in this case are identified as Class-B shares. Class-A shares charge a front-end load, which is taken from an investor's initial investment. Class-C shares are considered to be a type of level-load fund - no front-end and low back-end loads, but the fund's operating expenses are high. In all cases, the load is paid to a financial intermediary, and is not included in a fund's operating expenses.

 

The New York State Department of Motor Vehicles is currently issuing stickers for these vehicles.

Clean Pass is an innovative program that will allow eligible low-emission, energy-efficient vehicles to use the 40-mile Long Island Expressway High Occupancy Vehicle (LIE/HOV) lanes beginning March 1, 2006, regardless of the number of occupants in the vehicle. The program will result in an estimated reduction of 6,000 tons of greenhouse gas emissions and savings in excess of 500,000 gallons of gasoline.

To Apply for a Clean Pass:

Applications will be taken over the phone, by calling the State Department of Motor Vehicles at 1 (518) 486-9786, menu option 7, between 8 a.m. and 4 p.m., Monday through Friday. 

Federal Tax Credit.

Electric vehicles (EVs) purchased in or after 2010 may be eligible for a federal income tax credit of up to $7,500. The credit amount will vary based on the capacity of the battery used to fuel the vehicle. http://www.fueleconomy.gov/feg/taxevb.shtml

 

Preview of 2013 Tax Year

Earned Income and adjusted gross income (AGI) must each be less than:

• $46,227 ($51,567 married filing jointly) with three or more qualifying children
• $43,038 ($48.378 married filing jointly) with two qualifying children
• $37,870 ($43,210 married filing jointly) with one qualifying child
• $14,340 ($19,680 married filing jointly) with no qualifying children

Tax Year 2013 maximum credit:

• $6,044 with three or more qualifying children
• $5,372 with two qualifying children
• $3,250 with one qualifying child
• $487 with no qualifying children

Investment income must be $3,300 or less for the year.