To our witnesses, thanks for being here.
I have a letter from Karen Walter. She is posted overseas with her husband in NORAD in the United States. She received a letter from you folks at the CRA, a relatively aggressive one, telling her this:
[W]e have determined that you may have to pay a tax on the contributions you made [to your TFSA] while you were a non-resident of Canada in 2013. If this is the case, you should withdraw the contributions immediately to avoid any future tax.
Ms. Walter wasn't the only one. Her husband is posted at NORAD. We obviously have Canadian Forces posted all over the world. CRA policy states “if there is evidence that an individual's return to Canada was foreseen at the time of his or her departure, the CRA will attach more significance to the individual's remaining residential ties with Canada”.
Do Canadian Forces and their families not qualify under international residency, paragraph 1.17? Why are Canadian Forces families getting these letters from the CRA telling them that their contributions are not compliant with Canadian tax policy?