For several years now, the Internal Revenue Service (IRS) has been engaged in a vigorous campaign against international tax fraud and failure to declare bank accounts outside the U.S., including Canada. As a U.S. citizen or resident alien (including green card holders) residing in Canada, what are your U.S. tax obligations and what solutions are available to you?

U.S. income tax return filing requirements

U.S. citizens and resident aliens residing outside the United States are required to annually file a U.S. income tax return and declare worldwide income to the IRS, insofar as this income is equal to or greater than the personal exclusion amount and the applicable basic deduction.

The application of specific U.S. deductions combined with the foreign tax credit and the exemptions of the Convention Between Canada and the United States of America will, in the majority of cases, makes it possible to avoid double taxation.

 

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Since March 1, 2016, a new obligation may apply when entering into a private construction contract or a contract with an employment agency: it may be necessary to obtain an Attestation from the Agence du revenu du Québec (ARQ).

Application

  • Construction contracts carried out in Quebec where the contractor and subcontractor are both required to hold a licence issued under the Building Act and where the total value before taxes of all construction contracts concluded between them after February 29, 2016 exceeds $25,000;
  • Contracts signed between employment agencies and a client (other than a public body) to alleviate workforce shortages where the total value before taxes of all contracts concluded between them after February 29, 2016 exceeds $25,000;

Subsequently, the obligation will then apply to any other contract between the parties during the calendar year or in a subsequent calendar year, regardless of the amount of the contract. However, as long as an Attestation remains valid, the parties will not have to repeat the process for a new contract.

 

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February 2016

Welcome to IFRS Newsletter – a newsletter that offers a summary of certain developments in International Financial Reporting Standards (IFRS) along with insights into topical issues.

We begin this first edition of 2016 by looking at IFRS 16 Leases, the new standard on lease accounting which was published by the International Accounting Standards Board (IASB) on January 13.

We then move on to items currently in the IASB’s pipeline before taking a look at issues that regulators are likely to focus on in the coming months.

Further on in the newsletter, you will find IFRS-related news at Grant Thornton and a general round-up of financial reporting developments. We finish with a summary of the implementation dates of newer standards that are not yet mandatory, and a list of IASB publications that are out for comment.

 

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February 2016

Overview

The Grant Thornton International IFRS team has published IFRS Viewpoint – Classification of loans with covenants.

The IFRS Viewpoint series provides insights on applying IFRS in challenging situations. Each edition will focus on an area where the Standards have proved difficult to apply or lack guidance.

This edition considers how the existence of covenants can impact the presentation of debt on the balance sheet.