How to Become a Non-Resident of Canada

You want to escape the Canadian tax system.

You’re tired of the brutal winters, horrible healthcare, and sky-high taxes.

You know you need to get tax residency somewhere else (see our services page).

So the issue becomes – how exactly do you become a non-resident of Canada?

If you’re ready to put a plan in motion, check out our Escape Canada Package.

 

Becoming a non-resident of Canada for tax purposes involves several steps and considerations. Here’s a general guideline:

  1. Determine Your Residency Status: Canada uses various criteria to determine tax residency. Generally, you are a non-resident for tax purposes if you normally, customarily, or routinely live in another country and are not considered a resident of Canada; or you do not have significant residential ties in Canada, and you live outside Canada throughout the tax year or stay in Canada for less than 183 days in the tax year.
  2. Establish Residential Ties Elsewhere: Establish significant residential ties in another country. We suggest getting residency in Latin America, of course. This may include having a home, spouse, or dependents in the other country. 
  3. Cut Residential Ties with Canada: Sever as many residential ties with Canada as possible. This includes closing bank accounts, selling property, and canceling memberships.
  4. File a Departure Tax Return: When you leave Canada to become a non-resident, you may have to file a departure tax return. This is a special tax return where you report the “deemed disposition” of certain types of property at their fair market value on the day you leave Canada.
  5. Notify the Canada Revenue Agency (CRA): Inform the CRA of your change in residency status. This can be done through your tax return or by directly contacting them.
  6. Consider Other Implications: There may be other implications such as changes to your health insurance, pension plans, and other social benefits. Also, consider the tax laws of the new country of residence.
  7. Consult a Tax Professional: Tax laws can be complex and vary depending on individual circumstances. It is advisable to consult with a tax professional or a legal advisor to understand the implications fully and to ensure compliance with all legal requirements.

Remember, each individual’s situation can vary, and the rules are subject to change. The CRA’s website provides detailed information and guidelines, and consulting with a professional is always a good practice.

If you’re ready to put a plan in motion, check out our Escape Canada Package.

 

 

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