Jay P. Trudell, CPA
Clear and Practical Tax Advice for Non-Residents
Jay P. Trudell offers expert tax advice for non-residents, guiding clients through complex non-resident tax filing in Canada and the USA. He helps individuals and small businesses stay compliant while making informed, cross-border tax decisions.
Non-Resident Tax Filing Services in Canada & the USA
Understanding your tax obligations as a non-resident can be complicated—especially when your financial life spans countries. Whether you're a non-resident of Canada or the USA, you may still have tax filing responsibilities. Knowing what to file, when to file, and how your residency status affects taxation is critical to staying compliant and avoiding penalties.
I work with individuals and businesses navigating non-resident tax filing in Canada and the USA. My goal is to provide accurate, timely, and practical tax advice for non-residents, so you can meet your obligations without confusion or delay.
What Does “Non-Resident” Mean for Tax Purposes?
Tax residency is different from immigration status. You may be considered a non-resident for tax purposes even if you are a citizen or have ties to a country. Both Canada and the U.S. determine tax residency using their own rules, based on physical presence, residential ties, income sources, and visa status.
If you’re unsure whether you qualify as a non-resident, it's important to confirm your status before filing. This determination directly affects which forms you must file, what income is taxable, and which deductions or credits you can claim.
Non-Resident Tax Filing in Canada
If you are a non-resident of Canada and earn income from Canadian sources, you may be required to file a Canadian tax return—even if no tax is owing. Some types of Canadian-source income are subject to withholding tax at source, while others require a Section 216 or Section 217 return to report rental income, pensions, or similar income types.
Here are the main filing requirements and services involved in non-resident tax filing in Canada:
Section 216 Returns (Rental Income)
Non-residents who receive rental income from property in Canada must file a Section 216 return. While 25% tax is usually withheld at source, filing this return may result in a refund or reduced overall tax if expenses are deductible.
Section 217 Returns (Pension or Retirement Income)
If you receive Canadian pension income (like CPP, OAS, or RRSP withdrawals) as a non-resident, you may file under Section 217 to potentially reduce your tax burden.
NR4 Slips and Withholding Tax
If you're receiving certain types of Canadian-source income, the payer is required to issue an NR4 slip and withhold tax at the prescribed rate (typically 25%). However, tax treaties between Canada and your country of residence may reduce the required withholding rate.
Disposition of Canadian Property (T2062 and T2062A)
Non-residents selling taxable Canadian property, such as real estate, must file a T2062 form and request a certificate of compliance. This process includes calculating potential capital gains and ensuring the appropriate withholding tax is submitted.
Tax Clearance Certificate
Before the sale of a Canadian property is finalized, a non-resident seller must apply for a certificate of compliance, or they risk having 25–50% of the sale price withheld.
Deemed Disposition on Emigration
If you’ve left Canada and become a non-resident, you may be subject to deemed disposition rules, which trigger a capital gains tax on certain assets. A final return must be filed in the year of departure to report this.
Non-Resident Tax Filing in the USA
For individuals and entities with U.S.-source income but no legal residency or citizenship, non-resident tax filing in the USA is a separate set of rules. The U.S. uses a combination of physical presence and green card tests to determine tax residency. Those who don’t meet these tests are considered non-residents and typically file Form 1040-NR.
Here are the key services and requirements under non-resident tax filing in the USA:
Form 1040-NR – U.S. Nonresident Alien Income Tax Return
This is the main form used by non-residents who earn income in the U.S., including wages, scholarships, rental income, or U.S. business income. Only U.S.-source income is generally taxable.
W-8BEN and W-8ECI Forms
Non-residents earning passive income (such as dividends, royalties, or interest) must complete these forms to certify foreign status and potentially benefit from reduced withholding rates under tax treaties.
Withholding Requirements
The U.S. typically withholds 30% on certain types of U.S.-source income. However, the withholding rate can be reduced or eliminated under a tax treaty, assuming proper forms are submitted.
FIRPTA Withholding (Real Estate Transactions)
Non-residents selling U.S. real estate are subject to FIRPTA, which requires withholding 15% of the gross sale price unless a withholding certificate is approved to reduce the amount.
Treaty-Based Return Position Disclosure (Form 8833)
If you're claiming a tax treaty benefit that affects your U.S. tax position, you may need to disclose this on Form 8833. Not filing it when required can result in penalties.
FBAR and FATCA Reporting
Non-resident aliens with U.S. interests or signature authority over certain financial accounts may still have reporting obligations under FBAR or FATCA rules.
Cross-Border Considerations for Non-Residents
For individuals with ties to both Canada and the U.S., non-resident tax issues often overlap. It’s not uncommon for someone to be considered a non-resident in one country and a resident in another, leading to potential double taxation.
In these cases, tax advice for non-residents becomes especially important. Tax treaties between Canada and the U.S. help determine residency, tie-breaker rules, and eligibility for reduced tax rates or exemptions. Coordinated filings in both countries, with appropriate disclosures, can help avoid unnecessary taxation and penalties.
Why Accurate Filing and Planning Matter
Incorrect or incomplete non-resident tax filing in Canada or the U.S. can lead to unnecessary withholding, penalties, and audit risks. Many non-residents overpay simply because they aren’t aware of their rights under tax treaties or don’t know they’re eligible to file an optional return that lowers their tax burden.
This is where tax advice for non-residents adds real value. It’s not about aggressive tax strategies—it’s about understanding what the law allows and making informed choices that keep you compliant and efficient.
Jay P. Trudell, CPA, is an accountant who serves clients across Canada and the USA.