Leaving Canada
Canada’s departure tax
When you stop being a Canadian resident, Canada generally treats you as having sold most of what you own on the day you leave. The bill depends on what you hold and how you prepare.
Deemed disposition
A sale that never happened, taxed as if it did
On the day you emigrate, you are generally deemed to have disposed of most of your property at its fair market value, and to have reacquired it at the same value. Any gain accrued up to that day is reported on your final Canadian return as a resident, even though you sold nothing and received no cash.
For entrepreneurs and investors, that usually means shares of private companies, investment portfolios and crypto holdings. Because the tax arrives without a sale to pay for it, the timing and the structure of your holdings before you leave matter a great deal.
Your departure date for tax purposes is a question of facts. It is generally tied to when you leave, when your spouse or partner and dependants leave, and when you become a resident of your new country.
At a glance
What is usually in, and what is usually out
The general picture. The details depend on the type of property and your situation.
| Usually included | Shares in private and public corporations, investment and brokerage accounts, most foreign property, and other capital property such as crypto assets. |
|---|---|
| Usually excluded | Canadian real estate, property of a business carried on in Canada through a permanent establishment, and many pension and registered plan rights. These are generally taxed later, under non-resident rules, instead. |
| Reporting | The deemed disposition is reported with your final return as a resident. Emigrants with property above a reporting threshold also file a list of the property they own when they leave. |
| Paying later | You can generally elect to defer paying the tax on the deemed disposition until the property is actually sold, by providing acceptable security to the Canada Revenue Agency, subject to conditions. |
Forms, thresholds and security requirements are confirmed for your year of departure during the strategy.
Planning before the departure date
How departure tax planning usually runs
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Inventory
List what you own, where, and in which structure, with realistic values and accrued gains.
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Estimate
Model the deemed disposition, which property is excluded, and the tax payable in your province.
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Restructure
Look at timing, how your company and investments are held, and what makes sense before rather than after the move.
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Leave and file
Set the departure date on the facts, file the final resident return and elections, and set up non-resident reporting.
Do I pay departure tax on my house in Canada?
Canadian real estate is generally excluded from the deemed disposition on emigration. It remains taxable in Canada when you eventually sell it, under the rules for non-residents.
What about my RRSP and TFSA?
Many registered plans are generally excluded from the deemed disposition, but each has its own treatment after you become a non-resident, and your new country may tax them differently. They need to be looked at plan by plan.
Can I avoid departure tax by selling nothing?
No. The tax applies to the gains you are deemed to have realized, whether or not you sell. Planning is about what you hold, how, and when, not about avoiding a sale.
I own a private company. Is that the big one?
Often, yes. Shares of a private corporation that has grown in value are usually the largest item. How the company is structured and where its business is carried on are central to the plan.
Next step
Know your departure tax before you set a date
The Global Strategy Service estimates it and sequences your exit. General information only, not tax or legal advice. Your options depend on facts we have not reviewed yet.