Do I file Form RC267 even if no tax is owed?
Relief or credit claim obligations of this kind are generally required on the facts rather than on the tax result, so a nil position does not remove one. Canadian residents who cross the border to work and participate in a US employer plan.
What happens if I have missed Form RC267 for several years?
Missed years are dealt with as a package rather than one at a time, because the route chosen for the first year affects the relief available for the rest. We map the years and the obligations before anything is filed.
Is Form RC267 the same as the other reports I already file?
No. Deducts contributions to a US employer retirement plan for a Canadian resident who commutes to work in the United States. Satisfying a different obligation, even one covering the same accounts or entity, does nothing for this one.
Can I deduct my US employer plan contributions in Canada?
If you live in Canada and cross the border to work for a United States employer, contributions to that employer's retirement plan can be deducted on your Canadian return under the treaty. Without that relief the same retirement saving ends up deducted in neither country: Canadian rules on their own do not recognise contributions to a foreign employer plan, and a deduction taken on the American side does not reduce the income Canada is taxing. The claim goes on the Canadian return using the form that matches your circumstances, supported by the plan documents and the payroll records showing what was contributed and by whom.
Which form do I use for my US retirement plan contributions?
There is more than one, and choosing between them is not a question about the type of plan. What matters is whether you are a commuter — a Canadian resident who crosses the border to work — and where the employment was actually performed. The same plan, the same employer and the same contribution can belong on different forms for two people, or for one person in two different years, once those circumstances change. Answer that question before filling anything in. A claim made on the wrong form is not usually a lost deduction, but it is a correspondence cycle and sometimes a reassessment.
I commuted for part of the year only — does this still work?
It can, but the year has to be split on the facts rather than claimed as a whole. The relief follows the employment: contributions made while you were commuting to work in the United States sit in one category, and contributions made while the work was performed elsewhere may not qualify on the same basis. Keep the payroll records that show where the work was done in each pay period, and the plan statements showing when each contribution was made. Mid-year changes — a transfer to a Canadian office, a move, a change of employer — are exactly the circumstances where the form that applies changes with them.
What if I never claimed the deduction on past returns?
The saving simply went undeducted, usually for every year you commuted. That is the ordinary outcome when nobody asks the question, because a Canadian payroll slip does not prompt the deduction and the American employer has no reason to raise it. Earlier years can generally be looked at again, and the first step is establishing, for each year, whether the circumstances supported a claim: residency, commuter status, where the work was performed, and what was contributed. Gather the plan statements and payroll records for the whole period first. A request to adjust one year is more persuasive when the pattern behind it is evidenced.
My spouse and I both commute — do we claim separately?
Yes. The relief attaches to the individual, to that person's own employment and to that person's own contributions, so each return stands on its own facts even where the household looks identical from the outside. It is common for two people in one home to fall into different categories — different employers, one crossing daily while the other works partly on this side, one participating in a plan and the other not — and therefore for different forms to apply. Work each person's year through separately, and do not carry last year's treatment across from one return to the other.
What records do I need to claim contributions to a US plan?
Enough to show three things: that you were resident in Canada, that the employment was performed in the United States while you were commuting there, and what was actually contributed to the plan during the year and by whom. In practice that means the year-end statement from the American employer, payroll records showing the periods worked and where, and the plan's own statement of contributions separating yours from the employer's. Keep them with the return rather than filing and hoping. Where a claim is questioned, it is nearly always the evidence of commuter status, not the contribution figure, that the CRA asks to see.
What is a permanent establishment, and how easily do we create one?
A taxable presence in another country under the treaty — typically a fixed place of business such as an office, branch, factory or workshop, or a dependent agent habitually concluding contracts on your behalf. Some treaties add a services test measured in days. Purely preparatory or auxiliary activity is excluded, but that carve-out is narrower than it sounds: one senior employee working from home in the other country, with authority, has been enough. See business profits and permanent establishment.
Is double taxation illegal?
It is legal. Two countries can each have a valid claim on the same income — one because the income arose there, the other because you live there — and nothing prohibits both from exercising it. What exists instead is relief: tax treaties allocate the claim, and domestic law gives a credit for foreign tax paid. The relief is not automatic, though. It is claimed on a return, and unclaimed relief is simply lost. See how double taxation is relieved.
