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Tax Basics for New Immigrants to Canada: What You Need to Know
- David Lee
- Jun 4
- 4 min read
Updated: Jun 22
Author: David Lee, CPA, DAP Business and Education Consulting PC.
Migrating to a new country comes with many changes—and for new immigrants to Canada, one of the most important is understanding how the tax system works. Whether you are a permanent resident, work permit holder, or international student planning to stay for a few years, having a basic understanding of the Canadian tax framework is essential. To receive any benefit and credit payments, including any related provincial and territorial payments, you need to be a resident of Canada for income tax purposes. For some payments, you also need a valid immigration status.
This guide summarizes key tax-related information for immigrants in Canada, with highlights from official sources such as the Canada Revenue Agency (CRA) and Immigration, Refugees and Citizenship Canada (IRCC). This information is intended to support awareness and financial literacy for new residents.
1. Who Needs to File Taxes in Canada?
Anyone considered a resident for tax purposes in Canada is generally required to file an annual tax return. This includes:
Permanent Residents (PR)
Temporary Foreign Workers
International Students
Protected Persons and Refugees
According to the CRA, residency for tax purposes does not always match your immigration status. You become a resident of Canada for income tax purposes when you have enough residential ties in Canada. Factors like having a home, spouse, or dependants in Canada, or establishing significant ties, may make you a resident for tax purposes. This starts on the first day you live in Canada for most newcomers.Source: Canada Revenue Agency – Newcomers to Canada
2. What Is Taxed in Canada?
In Canada, both federal and provincial/territorial governments levy income tax. Newcomers should be aware of these taxable categories:
Employment income
Self-employment or business income
Investment income (interest, dividends, etc.)
Foreign income (if you are a tax resident, you must declare worldwide income)
Foreign income may be eligible for tax credits or treaty exemptions depending on your country of origin. More information can be found in CRA’s "Personal Income Tax" guide, including the federal and provincial tax rates and income brackets.Source: CRA – Personal Income Tax
3. When and How to File Personal Income Taxes
Tax year: January 1 to December 31
Filing deadline: April 30 (or June 15 for self-employed individuals, although payments are still due by April 30)
Method: You can file your return online using certified tax software, on paper, or through an authorized tax preparer.
Keep all your supporting documents for at least six years after you file your return. If the CRA chooses to review your return, you will have to provide them to support your claims.
If you live in Quebec, you also need to do a provincial tax return each year with Revenu Québec.
4. Important Tax Documents for Newcomers
Some of the common documents you may receive or need to submit include:
T4 Slip – for employment income
T4A Slip – for self-employed contractors
T5 Slip – for investment income
Notice of Assessment (NOA) – issued by CRA after your return is processed
SIN (Social Insurance Number) – required to work and file taxes
If you arrive in Canada partway through the year, you may need to report your world income from January 1 to the date of arrival for assessment and benefit claim purposes.
5. Understanding Tax Credits and Benefits
Tax credits and benefits help reduce your tax burden or provide financial support. Eligibility varies depending on income level and residency status. Some programs include:
GST/HST Credit
Canada Child Benefit (CCB)
Disability tax credit (DTC)
Canada training credit
To qualify for most credits, you must file a tax return even if you have no income.
6. Tax Deductions Overview
On top of tax credits, some expenses can reduce your taxable income through deductions. Common deductions (based on CRA eligibility rules) including but not limited to:
RRSP Contributions – Registered Retirement Savings Plan
Union or Professional Dues
Childcare Expenses
Moving Expenses (in specific cases related to employment or school)
Tuition Fees – for eligible students (T2202 certificate required)
These deductions can be claimed if applicable and supported by proper documentation.Source: CRA – Deductions, Credits, and Expenses
7. Language Support and Resources for Newcomers
The CRA offers services in multiple languages, including interpretation over the phone. You can access newcomer-specific resources through:
CRA Newcomers Portal
Settlement Agencies
Provincial immigrant support services
8. Key Tips from CRA for Newcomers (Non-Advisory)
Register for a CRA My Account: Track your benefits, file returns, and receive notices online.
Keep all receipts and tax slips: You may need them for future reference or audits.
Report changes in your personal situation (marital status, dependants, address) to CRA promptly to avoid benefit disruptions.
Final Thoughts
Navigating a new tax system can be overwhelming, but understanding your obligations and the available support services can help you get started on the right foot. Filing taxes properly also ensures you can access essential benefits and maintain good standing with the Canadian government.
If you need individual consultation to assess your situation, please email dap.biz.consulting@gmail.com or admin@hopewayimmigration.com to make an appointment.
Disclaimer
This article is for informational purposes only and may change over time. It does NOT constitute legal, tax, or financial advice. For personalized advice or assistance with your tax return, you should consult a qualified professional or contact the Canada Revenue Agency directly.
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