TAX NEWS FOR UN RETIREES RESIDING IN CANADA

The following notice from John Northcut,  CAFICS Councilor (for taxation matters) was published in the AFICS Bulletin, New York , Vol 40, No.2 (page 11) of April 2009:

“The Canadian taxation authority (Canada Revenue Agency) has re-confirmed, based on recent discussions with the U.S. taxation authority (Internal Revenue Service), that under the terms of the Canada-U.S. Tax Treaty, a portion of UNJSPF payments to UN system retirees residing in Canada is no-taxable on Canadian tax returns.  Guidelines have been established for taxpayers residing in Canada to calculate the amount of the non-taxable portion based on the same formula used for UNJSPF recipients resident in the USA.

AFICS members residing in Canada may obtain additional information by writing to the Canada Association of Former International Civil Servants (CAFICS),  c/o International Civil Aviation Organization, 999 rue University, Montreal (Quebec) H3C 5H7, Canada.

AFICS members who are also CAFICS members will be receiving this information automatically.  It is important to note that the guidelines provide for survivors of UNJSPF recipients also to qualify for a non-taxable portion.  Retirees who elect to take a partial lump sum payment at the time of retirement are also eligible under the guidelines.  The Canada Revenue Agency considers requests for adjustments of past returns (up to ten years) in cases where tax has been paid on the full amount of the UNJSPF payment received during a tax year.

John D. Northcut

Life Member of AFICS (NY), AFICS (Geneva) and CAFICS (Canada)

CAFICS Councilor (for taxation matters)”

In addition, in an e-mail to me on May 22, 2009, John Northcut had the following to say:

 

1) "   The CRA Headquarters told me they might at some point issue an INTERPRETATION BULLETIN but that it is not a priority at the moment since almost all taxpayers are following the CAFICS guidelines which so far the CRA (and Revenu Quebec ) are pleased with.  It saves them the work of issuing an Interpretation Bulletin.

2)    There are almost 1000 UN retirees in Canada who need to get their amounts of contributions from the UNJPSF.  So (as you can imagine) it is taking them some time to respond to the requests.  However, as long as UN retirees get the information by the end of this year, they will be able to go back up to 10 years (from 1999-2008) to file a Request for Adjustment.

3)    What some retirees have done is to contact the last agency where they worked.  The PER department often has on file the information on the amount of contributions.  Some agencies are more than willing to issue a letter (promptly) showing this information.  Other agencies just refer the retiree to the UNJSPF."

Comments

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[A. Haile]

As a follow-up to my earlier question, can anyone answer this: UN employees who are US citizens pay income tax to their government by so doing they will be contributing toward their Social Security plan which in return guarantees them Social Security payment when they retire. In the case of Canadians working for the UN they do not pay income tax to their government and as such do not get the benefit of contributing to Canada Pension Plan thus reducing the amount of pension they will receive from CPP. At the same time they pay Staff Assessment to the UN.
My understanding is that the UN returns the Staff Assessment amount to US citizens. My argument is that UN should return Staff Assessment contribution of Canadians so that they can put in the money into their Canada Pension Plan to help them boost their Pension income. Is this how it works? I am asking this because I happen to be a Canadian citizen who worked for the UN. I am now retired and had a rude awakening when I checked my Canada Pension Plan payment for the simple reason that I did not make contribution during my employ with the UN. Please helP shed some light. Thanks

[Paul]

I am going through separation with X. Does anyone know if the post adjustment gets included in the taxable amount. She is insisting that the entire salary and post adjustment be used in calculating spousal and child support. My my salary and postadjust ment are be. Added together and then MOVED UP so...172000 is moved up to 262000???? Doesn't seem fair because I have to live in expensive country.