Which country's return do I file first as a dual citizen?
Neither passport outranks the other, so the order is a practical question rather than a legal one. One return usually needs a figure the other produces: the tax actually paid in the first country is what the second country gives credit for, so the return that generates that figure is prepared first, even if it is filed second. Where both countries tax the same income, the sequence decides whether the credit can be computed at all or has to be estimated and then revised. We settle the order at the outset, in writing, so nothing is prepared twice.
Does holding two passports mean I only file one return?
No. Each citizenship carries its own filing obligation and neither one displaces the other. The treaty between the two countries decides which of them may tax a particular item of income, and it prevents the same income being taxed twice over, but it does nothing about the returns themselves. A dual citizen with income in only one country generally still has to file in both, often reporting the same income twice and claiming relief on one of them. The usual mistake is assuming that a country you have not lived in for years has stopped expecting anything from you.
I have never filed in my other country of citizenship, now what?
Start by establishing the years actually at issue, because that is usually narrower than people fear and it is what determines the size of the job. The two questions are which years you had a filing requirement, and for each of those years whether any tax would have been payable once treaty relief and credits are applied. Very often the answer to the second is little or nothing, which changes the character of the exercise from a liability into a paperwork catch-up. Both countries have established routes for bringing late years in. Choosing the route before filing anything matters, because a return filed in the ordinary way can close the door on the better route.
Is a tax-free savings account in one country also tax-free in the other?
Often not. A tax exemption is a creature of the country that granted it, and the other country is under no obligation to recognise it. A dual citizen can therefore hold an account that is genuinely exempt at home and fully taxable abroad, with annual reporting attached, and the income arising inside it still has to be worked out and declared. Treaties do protect certain retirement arrangements by name, which is why the wrapper matters more than the investments inside it. The practical consequence is that the account type should be chosen with both systems in view, since moving money later can itself trigger tax.
Should the spouse without dual citizenship hold our investments?
It is one of the few decisions in this area that costs nothing to make well and a great deal to unwind. Where one spouse is exposed to two tax systems and the other to one, which name sits on an account changes how the income inside it is reported and taxed, and whether it is reportable at all. The point is to settle it before the account is opened or the fund is bought, not afterwards. Moving an existing holding between spouses is itself a transaction, and in both systems it can have its own tax consequences and its own attribution rules about whose income the later return shows.
Will I end up paying tax twice on the same salary?
That is what the treaty exists to prevent, and in practice it usually does. One country gets the primary right to tax a given item and the other gives relief for the tax paid, either by exempting the income or by crediting the foreign tax against its own. The relief is not automatic: it has to be claimed on a return, with the foreign tax substantiated. Two things go wrong. Relief is claimed for a tax that was not the right tax to pay, and the other country will not credit it. Or the claim is late, and the year it belongs to has closed.
Does foreign employment income create RRSP room?
Only where it is earned income reported on a Canadian return. RRSP room is built from earned income that Canada sees, so a non-resident year of foreign salary generally builds none, and foreign tax paid does not create room of its own. This is why people returning to Canada after years abroad find their contribution room much smaller than the years elapsed suggest, and why the notice of assessment is the only reliable statement of it. See returning to Canada after years abroad.
Does my foreign spouse have to pay US tax?
Not unless something connects them to the US system: they are a citizen or green card holder, they meet the substantial presence test, they have US-source income, or you elect to treat them as a US resident so you can file jointly. That election is the one people make without weighing it, because it reaches their foreign salary, their foreign investments and their foreign accounts, not just their name on the form. See a US person with a non-resident spouse.
