Do I have to file at home while living in Sri Lanka?
It depends on residence, not on address — except for US citizens and green-card holders, for whom the answer is yes regardless of where they live. We settle the residence question first, because every other answer follows from it.
Is there a treaty between my country and Sri Lanka?
Treaty networks change with each protocol and each multilateral-instrument position, so we confirm the treaty in force for your specific year with the issuing authority rather than relying on a published summary. Where there is none, unilateral relief and domestic law do the work instead.
I own property in Sri Lanka. Where is the rent taxed?
Where the property is. That is close to universal, and it usually arrives as withholding on the gross rent rather than as a return on the profit — which is why the election onto a net basis, where Sri Lanka offers one, is normally the first thing to check. Your home country taxes the same rent and credits what was paid.
I inherited my parents' house in Colombo. What do I owe now?
Inheriting is not usually the taxing event at home; selling is. What the inheritance does is fix a starting point. In Canada and the United States the later gain is measured against a cost base set at the date of death, so the value at that date decides most of the eventual bill. Sri Lanka has its own transfer and disposal formalities to complete before the title can be dealt with at all, and those run on a local timetable. The immediate task after a death is therefore evidential rather than financial: establish the value, secure the title, and keep the paperwork together.
How is the cost of inherited Sri Lankan property worked out?
By valuation at the date of death, evidenced rather than estimated. That evidence is the asset in this kind of engagement, because everything you eventually report on a sale is measured from it. A contemporaneous valuation by a local valuer is the strongest form. Where the death was years ago and nobody obtained one, a retrospective valuation supported by comparable transactions from that period can be prepared, and it should state plainly that it is retrospective and what it relied on. Add the costs of obtaining and transferring title, and record the currency conversion for the same date.
Do I report a Sri Lankan inheritance on my Canadian return?
Receiving an inheritance is not itself income in Canada. What follows it can be reportable in two ways. Once the property is yours, foreign holdings above the reporting threshold bring an annual information return in their own right, and that obligation begins when you acquire the property rather than when you sell it. Then, on a disposal, the gain measured from the date of death value goes on the return for that year, with relief claimed for Sri Lankan tax on the same disposal. The inheritance itself is silent. The ownership and the sale are not.
What valuation evidence do I need for a date of death?
A written valuation naming the property, the date it speaks to, the person who prepared it and the basis they used. Comparable transactions from the same period are worth keeping with it. So are the deed, the survey plan, any probate or administration documents, and a record of what each heir received, because an undivided share is valued as a share. Photographs of the condition at that time help where the property was later improved or left empty. Assemble this while the people who remember the property are still available. Reconstructing it a decade later is possible but much weaker.
I am moving back to Sri Lanka. When does my Canadian filing stop?
Not on the day the flight lands. Canadian residence ends when your ties end, and the year of departure is filed as a part-year, with the departure itself treated as a disposal of most of what you own at that moment so that accrued gains are settled before you go. Property, registered plans and business interests each have their own treatment within that. Afterwards, Canadian-source income can still carry obligations of its own. The sequence matters: value your holdings as at the departure date, then file the departure year properly, rather than discovering the position two returns later.
Can I claim Sri Lankan tax paid when I sell the property?
Relief for tax paid where the property sits is the normal pattern, claimed on the home return for the year of the disposal and limited to the home tax on that same gain. Two practical points decide whether it works. The gain is measured differently in each country, because the cost base at home is the date of death value while the local computation may start somewhere else, so the figures rarely match. And the claim needs the local assessment or receipt as evidence, translated, rather than a bank debit. Keep the conveyance documents filed alongside them.
How do I qualify for the foreign earned income exclusion?
The exclusion means exactly what it says — foreign earned income left out of the US tax base — and to qualify you need a tax home in a foreign country and then one of two tests. The bona fide residence test asks whether you were genuinely settled there for an uninterrupted period including a full tax year — a facts-and-circumstances judgment. The physical presence test is arithmetic: a set number of full days in foreign countries within any twelve consecutive months, which you may choose to maximise the exclusion. They are alternatives, and a housing amount sits alongside. See the foreign earned income exclusion.
When is Form 1116 required?
Whenever you want a credit for foreign income tax on a US return and you do not qualify for the small-amount election. Filling it out means putting each foreign amount in its category and working the limitation, not copying a figure off a slip. The form does the arithmetic the credit turns on: it puts the foreign income into its category, works out the US tax attributable to it, and caps the credit at that figure. Without the form there is no limitation computation, and without a limitation computation there is no carryover to use in a later year. See Form 1116.
