Foreign Entity reporting (T106/T1134/T1135)

Canadian individuals who own or hold specified foreign property where the total cost at any time in the year was more that $100,000 CAD are required to file special information return. Failure to do so will result in substantial penalties. There are a number of exemptions that apply. To learn more, please read below:

A Canadian taxpayer is required to file a federal information return if the taxpayer has a foreign affiliate at any time in the year. Generally, a foreign affiliate is a non-resident corporation whose shares are owned by a Canadian resident taxpayer or partnership as follows:

  • at least 1% is owned directly or indirectly by the Canadian resident; and
  • at least 10% is owned directly or indirectly by the Canadian resident and related persons.
  • A Canadian corporation that had transactions with a foreign affiliates also need to prepare special information returns to advise CRA of all transactions. Failure to file information returns results in substantial non tax deductible penalties and interest.

    Our certified tax professionals will ensure all these requirements are met and all necessary returns are filed on time, making sure that you are fully compliant in the eyes of Canada Revenue Agency.