IMPORTANT: Unfortunately, you can't claim this tax credit anymore. It has been eliminated for 2016 and subsequent tax years. However, if you’re preparing your return for 2015 or earlier, you can still claim the credit for those years.
Did you work overseas for at least 6 consecutive months with a Canadian company? With the T626: Overseas employment tax credit (OETC) form, you can claim a credit for the work you’ve done outside of Canada if you were a resident or deemed resident of Canada at any time in the year.
To be eligible for the OETC, you must have done at least 90% of your work overseas. Your work must have also been in one of the following activities:
- Exploration for or exploitation of petroleum, natural gas, minerals, or other similar resources
- Construction, instillation, agriculture, or engineering
- Any work done while under contract with the United Nations (UN)
You should keep in mind that if you worked under the international development assistance program of the Canadian International Development Agency (CIDA), you won’t be able to claim this tax credit for your work.
Note: This tax credit is phased out for 2016. If you entered into your contract before March 29, 2012, the phase-out amounts won’t apply to you. Visit the Canada Revenue Agency (CRA) website to see if the phase-out affects your tax situation.
Remember to have your employer complete Part 1 of your T626 for you. Keep the completed form on file in case the CRA asks to see it at a later date.
Note: If you’re a resident of Québec, you’ll receive the RL-17: Rémunération provenant d’un emploi à l’extérieur du Canada slip from your employer and you’ll need to enter information from this slip into your return.
Where do I claim this?
Follow these steps in H&R Block’s tax software to file your 2015 or prior year taxes:
- Under the PREPARE tab, click the LET'S TALK ABOUT 2016 icon.
- Select the checkbox labelled I was employed and click Continue.
- On the Employment page, select the checkbox labelled Overseas employment tax credit (T626).
- When you arrive at the page for the Overseas employment tax credit, enter your information into the tax software.