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BBCWatcher made this comment in a thread which has since been closed:

That's not your objection, really. Or at least it's an unrealistic one, inconsistent with what sovereigns do around the world. Including Canada, notably via Form 1135.(*) Your objection, distilled to its essence, is that you think U.S. citizens ought to be able to maintain the rights and privileges of that citizenship without particular U.S. citizenship-tied obligations (taxes and financial reporting). Fine, fair enough, but unless you're also campaigning heavily online against CRA Form 1135 then I've more accurately described your position.

(*) CRA Form 1135 also demands that Canadian residents disclose all "specified foreign properties." That includes foreign real estate, foreign patents, foreign copyrights, and much more. The United States government doesn't require anywhere near that level of reporting detail. Canadian tyranny!
Wow, who knew! I've been doing my own Canadian income taxes since I moved to Canada in 1970 and I'd never heard of this one. Details can be found at Foreign Income Verification Statement. I've not been able to figure out when it first started but apparently it was ammended in 2013 without any public consultation that I've seen. Probably done in an Omnibus bill (Canadians will know what I'm talking about).

It's not quite as bad as it sounds though. Foreign real estate is only taxable if it's not used as a residence. Financial instruments are only reportable if held outside of a registered plan (e.g. RRSP, TFSA, etc). The threshold for reporting is $100,000. It really does seem to be oriented towards "fat cats" and I suspect most ordinary Canadians won't be affected. The penalties for non-compliance aren't as draconian as the American ones either.

The biggest difference between the Canadian T1135 and the US FBAR and IRS form 8938 is the fact that it only applies to Canadian residents. If I were to move to Great Britian, for example, none of my local bank accounts, brokerage accounts, property, etc. would be reportable since I'd no longer be a resident of Canada. Canada, like most of the world (except for Eritrea and the USA), has a residence based tax system (RBT), rather than a citizenship based system (CBT). Canada seems to understands that if a person isn't receiving any services, it's not reasonable to force him/her to file and pay taxes.
 

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Bravo, Hillbilly! The thread was closed before I had a chance to respond to BBC's apples and oranges comments. Canada is far from "tyrannical" about foreign reporting and there is really no comparison to the onerous reporting the US asks for. Besides the threshold being an order of magnitude higher than US reporting ($100,000 vs. $10,000), it only applies if you live in Canada. Canada is boringly ordinary and normal with its RBT system.

BBC also got it wrong about my objections to US CBT. What I really object to is the US trying to interfere in my financial affairs after more than 40 years of living in Canada solely as a Canadian. Far from "maintaining the rights and privileges" of US citizenship, I never even had so much as a US passport until I was (erroneously, as it turns out) ordered to get one by US border officials. Once I figured out that I had gotten bad "advice" that passport never got used again. I ask nothing of the US government other than they leave me alone to live my Canadian life without interference.

Meanwhile I am quite happy to pay my Canadian taxes because I actually get valuable services for my money. I suppose US residents get something for their taxes paid, but US expats get nothing but grief from the US government.
 

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The biggest difference between the Canadian T1135 and the US FBAR and IRS form 8938 is the fact that it only applies to Canadian residents.
Canadian tax residents, to be more precise. CRA requires affirmatively "checking out," with certain implications.

CRA Form T1135's filing threshold covers a much larger asset base than FinCEN Form 114's. Which filing threshold is "lower" in your personal circumstances? "It depends."

So is CRA Form T1135 or FinCEN Form 114 "worse" than the other? "It depends." CRA Form 1135 is based on tax residence, a higher numeric filing threshold, and a more invasive/detailed/larger asset base. FinCEN Form 114 is based on citizenship (also including residents), a lower numeric filing threshold, and a less invasive/detailed/smaller asset base.

I would note that, if you're slightly suspicious (conspiratorial?), CRA Form T1135 is better suited to future imposition of a foreign wealth tax on Canadian tax residents, as Italy (for example) introduced based on the structure of its comparable Form RW. More of that Canadian government tyranny may be in your future. ;) Neither FinCEN Form 114 nor IRS Form 8938 are as well suited to wealth taxation.

Yes, I'm joking. Well, half joking. One ought to have some sense of humor about such matters. We're discussing very First World "problems" here, and these are not the tax and financial reporting distinctions or issues that are top of my priority list. For example, we're very fortunate we're not residents of a country with 25% unemployment for about five years with no end in sight. We're fortunate we're not young adult males (or with young adult male children) subject to compulsory military service in the nearly 40 countries where that's reality. Canada and the United States, to pick two examples, are both wonderful countries with wonderful citizenships. Enjoy either or both, as you wish.
 

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Yes, I'm joking. Well, half joking. One ought to have some sense of humor about such matters. We're discussing very First World "problems" here, and these are not the tax and financial reporting distinctions or issues that are top of my priority list. For example, we're very fortunate we're not residents of a country with 25% unemployment for about five years with no end in sight. We're fortunate we're not young adult males (or with young adult male children) subject to compulsory military service in the nearly 40 countries where that's reality. Canada and the United States, to pick two examples, are both wonderful countries with wonderful citizenships. Enjoy either or both, as you wish.
And that I can agree with wholeheartedly. One only needs to take in the daily world news to realize we have much to be thankful for. July 1 (in Canada) and July 4 (in the US) is a good opportunity to forget about taxes, have some summer fun, and reflect on our good fortune. After all, we have all now presumably made it through our respective tax (and even FBAR) filing deadlines.
 

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Since we're talking about Form 1135, it's worth mentioning, for any of you Canucks who have retirement plans left behind in a country of origin, that "exempt trusts" (retirement plans that you can't get your hands on the money easily or without a penalty) are not reportable.

This includes U.S. traditional/simple IRAs, 401k plans, and 403b plans. It does not include U.S. Roth IRAs.

BTW, if you have to contact CRA about Form 1135 and want to know if a particular plan counts as an "exempt trust," you can save yourself some time by asking to be referred to the Trusts and Estates staff.
 
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