Question

Hi Phil and have just read some of your website items on relocating to Canada. My wife and I are both Canadian Citizens and are starting to plan our move back to Canada (the Island actually) after 25 years so I am just exploring the tax consequences.

I am retired and have assets and income exceeding the expatriate limits so have reviewed the Form 8854 requirements with the capital gain exclusions. From what I have read upon entry into Canada the cost base for my assets would be adjusted to fair market value without any Canadian tax so it appears that I could come out ahead on the gain side to the U.S.

Exclusion limit. Am I missing something? I have a small 401K and pension account down here but aside from that my assets are in stocks and real estate. I am also aware that I would be required to file a U.S. tax return for a number of years after the move and I haven’t been able to find any information on this so would love to have a chat with you or correspond by email so get a better understanding of all considerations.

Your time would be appreciated.

XXXXX

Answer

Hi XXXX

Thanks for the email.

I’m assuming you’re both US citizens, however please let me know if that is not a correct assumption.

If this is the case, and you do not officially renounce your US citizenship you won’t need to worry about the expatriation tax rules. If however you were going to officially renounce these rules would apply.

Once in Canada you would need to continue filing US tax returns as well as Canadian tax returns each year.

Please give me a call at the office at 250-381-2400 and we can discuss in more detail.

Cheers

Phil

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