Foreign Income Verification Statement

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The Foreign Income Verification Statement refers to Form T1135 issued by the Canada Revenue Agency (CRA). It is used by Canadian taxpayers to report their foreign income and foreign property holdings over a certain value.

🔍 What Is Form T1135 (Foreign Income Verification Statement)?

It is a mandatory disclosure form required by the CRA for:

• Individuals
• Corporations
• Trusts
• Certain partnerships

Who owns or holds specified foreign property costing more than $100,000 CAD at any time during the year.

📌 Purpose of Form T1135

To help CRA detect and prevent tax evasion by ensuring taxpayers report their:

• Foreign investment income
• Foreign bank accounts
• Foreign real estate
• Other foreign property

🏘️ What Is "Specified Foreign Property"?

Includes:

• Foreign bank accounts
• Foreign stocks (not held in a Canadian brokerage)
• Foreign mutual funds
• Real estate outside Canada (unless for personal use only, like a vacation home)
• Interests in non-resident trusts
• Shares of foreign corporations
• Other tangible/intangible property outside Canada

Excludes:

• Property used exclusively for personal use     (like a vacation home or car)
• Foreign investments held in RRSPs, TFSAs, RESPs,      etc.

🧾 When and How to File

• Due date: The same as your tax return due date (usually April 30 for individuals).
• Method: Can be filed online via CRA’s system or on the paper.
• Two reporting methods:
  • Simplified: If total foreign property cost  is $100,000–$250,000
  • Detailed: If over $250,000

⚠️ Penalties for Not Filing

• Minimum $25 per day (up to $2,500)
• It can be much higher for gross negligence or repeated failures

The Voluntary Disclosure Program (VDP) can help avoid these penalties if your application is accepted.

Disclaimer: This information is general and not legal or tax advice. Tax situations vary, so consult a tax professional for advice specific to your circumstances.