Assignment 1: Residency

Residency of Individuals and Taxation of Non-Residents

Case A
Donald would be considered a resident of Canada. Donald has been living somewhere in
Canada (a house, apartment, condo; not specified in the case) for the past half year from July
1st to December 31st. He also started working since the day he arrived. Common law would
probably deem him a resident based on these conditions. Section 250(1)(a) of the Income Tax
Act would deem Donald a resident because he has sojourned to Canada for more than 183
days.

The full $11,000 amount is taxable. Half of the €11,000 amount will be taxable. For the
portion of the year (half in this case) that Donald was not a resident Canada, the interest
earned on his UK savings account is not taxable.

Case B
Under common law, neither Uta or Colin would be considered a resident of Canada. Uta
Jurgens is deemed to be a Canadian resident under section 250(1)(g) of the Income Tax Act. She
is exempt from German taxes due to her relationship with her husband. Colin Jurgens is also a
Canadian resident because he is part of the Canadian armed forces, s.250(1)(b). The full 28,000
is subject to Canadian taxation.

Case C
Martin would probably not be considered a resident under common law since he does
not have a home in Canada, spouse/common-law partner, or personal property in Canada.
There are also no sections in the Income Tax Act for deemed resident that apply to Martin.
Therefore, Martin is not a resident of Canada. However, the $15,000 would be subject to
Canadian taxation under employment income.

Case D
Sarah would probably not be considered a resident of Canada under common law. She
does not have a home in Canada anymore, she has no spouse, and her personal property is with
her in New York. She does have a savings account in Canada but that probably will not be
enough to deem her a resident of Canada. No sections of the ITA apply, therefore Sarah is not a
resident of Canada.

Residency of Corporations
Case A
Common law would suggest that Bonix is not a resident of Canada. However, section
250(4)(a) deems Bonix to be a Canadian resident since they were incorporated in Canada after
April 26, 1965.

Case B
Assignment 1: Residency

Common law would not deem Dorad to be a Canadian resident. Their mind and
management are located in the US. There is no applicable paragraph of the Income Tax Act that
would deem Dorad to be a resident. Therefore Dorad is not a resident of Canada.

Case C
Common law would deem Upton a Canadian resident since their headquarters, entire
board of directors, and meeting are held in Halifax.

Case D
Common law would not deem Carlin a resident of Canada. Section 250(4)(a) of the
Income Tax Act would deem them a Canadian resident since they were incorporated in Canada
after April 26, 1965.