FOREIGN REPORTING
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Reporting Foreign Assets
Individuals, trusts, corporations and partnerships with foreign property (including shares, bank accounts and real property) are required to report information related to interests in foreign property where the total cost exceeds $100,000. The deadline for such filing is the filing due date for the entity's taxation year. This would be April 30th for most individuals.
Generally, the reporting is in the form of a "check-the-box" system whereby affected taxpayers are required to check boxes that relate to the type, location and range of investment levels, and indicate the income related to the reported property.
Examples of reportable investments include two foreign investments which individually cost less than $100,000 but exceed that limit in aggregate, investments held in a custodial account through a Canadian stockbroker, a Florida condominium that is rented out with a reasonable expectation of profit.
Non-reportable investments include foreign assets held in an RRSP or a condominium in Florida that is a personal-use property.
Where a taxpayer has an equity interest in a foreign corporation of at least 1% and the taxpayer and persons related to the taxpayer hold in aggregate an equity percentage of 10% or more of the non-resident corporation, the reporting is much more detailed. In order to allow time to prepare this additional detail, the filing deadline for these returns is 15 months after the end of the entity's fiscal period.
Penalties
There are substantial penalties for the failure to report foreign assets. The basic penalty for late filing is $25 per day (subject to a minimum of $100) up to $2,500. However, where the form is late filed and the taxpayer has not made a reasonable effort to provide the information required, the penalty is $500 per month for up to 24 months. More severe penalties (the greater of $24,000 or 5% of the cost of the foreign property) will be imposed for wilful non-filing for more than 24 months or where there has been wilful omission amounting to gross negligence.
Foreign Income
The provisions of the Income Tax Act require that Canadian residents report their world-wide income. The above-noted foreign reporting requirements represent the Canada Revenue Agency's efforts to ensure all Canadian residents are reporting their foreign income.
You should be aware that the U.S. government has agreed to provide the Canada Revenue Agency with all information regarding investment income earned by Canadian residents.
Forms
The appropriate forms for reporting interest in foreign property may be obtained from the Canada Revenue Agency's website at www.cra-arc.gc.ca/forms "Foreign Reporting", or from your professional advisor.

"Information contained herein is of a general nature. No action should be taken without seeking professional advice that takes into account current developments and the specific facts of a particular situation."

[Updated -February 20, 2010]