CANADA Law and Practice Contributed by: Ian Hull, Suzana Popovic-Montag and Nick Esterbauer, Hull & Hull LLP
political office in Canada. There are several require - ments for obtaining citizenship, including: • attaining permanent resident status; • demonstrating a settled intention to reside in Canada; and • successful completion of the Canadian citizenship test. To qualify for citizenship, an individual must normally have been physically present in Canada for at least 1,095 days during the five years immediately prior to the application. 7.2 Expeditious Citizenship If an individual satisfies the citizenship requirements referred to in 7.1 Requirements for Domicile, Resi- dency and Citizenship , the following mechanisms may help expedite the citizenship process: • express entry, consisting of the Canadian Experi - ence Class, the Federal Skilled Worker Program and the Federal Skilled Trades Program, which facilitate obtaining permanent resident status more quickly; • urgent processing, which shortens the processing times where citizenship may be required to apply for/retain employment; and • ministerial discretion under Subsection 5 (4) of the Citizenship Act, RSC 1985, c C-29. Currently, there is no direct investment-based route to Canadian citizenship, although the Start-up Visa Program permits foreign nationals to become perma - nent residents if they obtain a commitment from des - ignated entities, such as business incubators, angel investors or venture capital funds. 8. Planning for Minors, Adults with Disabilities and Elders 8.1 Special Planning Mechanisms Minors A variety of tax credits and government benefits may be available to supplement the cost of caring for minor children in Canada. For example, a parent who did not contribute to the Canada Pension Plan (CPP) while
caring for a child under seven may be entitled to CPP benefits. The Child Rearing Dropout Provision pro - vides that the government will contribute to the CPP during periods spent out of the workforce while raising a young child. Registered Education Savings Plans A RESP is a popular and tax-effective tool to save for a child’s future. Contributions to a RESP are held in trust for the child, and the federal government will match 20% of contributions (to a maximum of CAD500 per year or CAD7,200 during the child’s lifetime) through the Canada Education Savings Grant. Contributions to a RESP may also be made through the Canada Learning Bond. RESP contributions are not tax deductible. Tax on income generated by the plan is deferred until with - drawal, typically in the hands of the child, who is often in a lower tax bracket than the contributors. Trusts benefitting minors High-income parents may establish trusts for the benefit of their children while they are minors; inter vivos trusts are used less frequently than testamentary trusts. Family trusts may be especially useful for high- income families by deferring taxation and allocating income to family member beneficiaries in lower tax brackets. Planning for Adults With Disabilities Government benefits are typically available to adults with disabilities who are unable to work. For example, Canadians with “severe and prolonged” disabilities may qualify for disability benefits through the CPP. Starting in 2025, working-age Canadians who are liv - ing with disabilities may also apply for the Canada Disability Benefit, a guaranteed, tax-free income sup - plement. Social assistance may also be available for adults with disabilities who are unable to work and have limited assets. Disability benefits received through the gov - ernment are typically taxable income. In addition to benefits and grants available to adults living with disabilities, Canadians may be eligible for tax credits and deductions related to disability.
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