Canada Income Tax Filing Requirements for Non-Residents

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Tax rules can be confusing at the best of times. However, Canadian tax laws are not overly complicated for non-residents. If you are a non-resident but receive income from a source in Canada, you must pay income taxes. But depending on the type of tax paid, you may not be required to file a return.


According to the Canada Revenue Agency, a non-resident's tax responsibilities are dependent on the type of income received. Generally, non-residents are required to pay either Part XIII Tax or Part I Tax, so named because of the sections of Canada's Income Tax Act in which they fall.

A number of sources of income are subject to Part Tax XIII, including income earned from dividends, registered retirement savings plans, pensions, Canada Pension Plan and Quebec Pension Plan, rental and royalty payments, annuity fees, or management fees. The Canadian Revenue Agency indicates that if you receive income that's subject to Part XIII Tax, you are not required to pay any additional type of tax on the income.

Income that's subject to Part I Tax may include employment income from a Canadian source or from a business carried out in Canada, income earned from a source outside of Canada while you were a Canadian resident, the portion of scholarships, bursaries and the like that is taxable, capital gains earned from the disposal of Canadian property, or income earned providing a service in Canada outside regular employment.

Part XIII Tax

If your income is subject to Part XIII Tax, you are not required to file a tax return, but there are two situations in which you may elect to file electronically: if you receive rental income or royalties from timber. If you elect to file, you may be eligible to claim a refund for taxes paid. The usual Part XIII Tax rate is 25 percent.

Part I Tax

If your income is subject to Part I Tax, you may be required to file a tax return. The payer is required to deduct 15 percent of the gross amount of income, but if it is determined that you have an additional tax obligation to Canada, you must file a tax return. It may be necessary to file a return to determine if an outstanding amount exists.