On Wednesday, February 15, 2012 11:13:48 PM UTC-4, Andy Petro wrote:   
   > "Alan Bowler"  wrote in message news:jhg   
   ln$qvj$1@dont-email.me... > On 2/14/2012 9:01 PM, Andy Petro wrote: >> How   
   much can we deduct from a German pension received from Germany. Was >> 50 % >>   
   last year but it caused double    
   taxation which Ottawa was fighting. > > First you need to explain the   
   situation more clearly. > > Generally you don't "deduct" anything from foreign   
   income. > That is normally done by whoever is paying you before you > receive   
   it, and then you claim    
   credit for taxes already > paid (deducted), even though they were paid to the   
   the foreign government. > This usually works out to about a 50/50 split of the   
   actual > tax between the two governments, but details vary based on the >   
   particular tax treaty. >   
    This is not the case with Germany with whom they have a tax treaty. It they   
   received 5000.00 .They deducted 50 % and paid Canadian tax on the other   
   2500.00 however things changed last year when Germany demanded that we pay   
   them also on the 2500.00 .    
   Canada called this double taxation , fought it and won. So we don't know where   
   we stand in the amount to deduct.   
      
   Answer:  We have to contact the Canadian Minister of Finance to find out if   
   Revenue Canada's interpretation of the Treaty is correct.  I have also    
   experienced double taxation for several years since 2005 and have only   
   received a small "foreign tax    
   credit" back for the years involved.  However, I believe the Treaty was   
   intended to protect us from paying any tax in Canada on our German   
   pension income, same as it was before 2005, and that only Germany is going to   
   collect this tax from us.  And that, for the years we paid   it here, before   
   we were contacted by Finanzamt Neubrandenburg directly, we should be entitled   
   to a full tax refund    
   in Canada and not just the pitiful "foreign tax credit".  However, this   
   question can only be satisfactorily resoved by contacting the parties who   
   signed the Treaty, viz. the 2 finance ministers. And since the question at the   
   moment is a Canadian one, I    
   shall write to the Canadian finance minister first and see what he or his   
   staff have to say in the matter.  It would certainly help our cause if more   
   people in the same situation would do the same!  Kate Miller   
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)