I would like to discuss my unique tax situation for next years filing so I could prepare for tax scenario in advance and make sure all documentation/filing is done properly. I am currently on H1B in US and it expires in June 2018. Until that point, I will continue working in US (153 calendar days in 2018). Upon expiration of my work visa, I will be moving to India for couple months. I've worked out an arrangement with my employer to work remote. That being said, I would be working from India for 2-3 months. Here's the tricky part now. I had applied to Canadian residency and expect to obtain PR by August 2018. I plan on moving to Canada and settle there. Sorry if this has confused anyone but yeah, its lot of moving back between countries for me in coming year. So my questions are

1) For taxation purpose in US, I meet substantial presence test and will likely qualify as resident whereas in Canada, by virtue of my PR status, I will be considered resident there as well. Where should I file my taxes? US or Canada. If I need to file in US, do I still need to file taxes in Canada and under what filing status?

2) I have 401k account through my employer which I would like to collapse and bring it to Canada so I can manage it under one roof. Could you suggest a best strategy to minimize tax liabilities and how if I can claim foreign credit in Canada for taxes paid to IRS?

I understand there may not be easy answers but at least if someone could point me right direction to look for relevant material that would be helpful too.

Thank you in advance for your generous help!

  • Also important: if you must file in a country, what income is included in that filing? – DJohnM Dec 21 '17 at 17:30
  • I highly recommend you talk with a tax professional (who specifically specializes in immigrant tax situations between Canada & US + some exposure to 3rd party countries). Your situation could go many different ways, and you will likely need to make some very specific 'filing positions' (ie: the way you structure your tax filings + possibly accompanying letters) that can make things very difficult for you if you err. Having a professional who makes these decisions may make them responsible for mistakes in interpretation that they make. Though researching online first is a good idea! – Grade 'Eh' Bacon Dec 21 '17 at 17:46
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    Fortunately you shouldn't be double or triple taxed on the same income, as the US, India and Canada all have tax treaties with each other allowing you to get a tax credit in each country for the taxes paid in the other countries. Even in the worst case where all three countries require that you report and pay income tax on your entire 2018 income, you'll only be effectively taxed at the highest rate of the three countries, not the sum of all three rates. – Ross Ridge Dec 21 '17 at 18:33

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