Emigrant Tax Return: Filing Your Final Canadian Return Abroad

How do I file my Canadian taxes after moving abroad?

For the year you leave, file the ordinary return package for the province or territory you lived in on your departure date, report your world income up to that date, and enter the departure date on page 1 (CRA: Leaving Canada). The non-resident package is for later years, not this one. The return and any balance are due April 30 of the following year.

Filing is required when the move triggers a deemed sale. A person resident in Canada at any time in the year must file if they had a taxable capital gain or disposed of capital property (Income Tax Act, s. 150(1.1)), and leaving Canada treats most of your property, other than Canadian real estate, registered plans such as an RRSP or TFSA, and property of a business you run through a fixed place in Canada, as sold on your departure date; if you were resident in Canada for 60 months or less in the last ten years, property you owned when you arrived, or inherited since, is also left out (s. 128.1(4)(b)).

A departure return is not simple when:

• You owned reportable property worth more than $25,000 in total on departure (Form T1161), or have a deemed gain to report (Form T1243) or defer (Form T1244). These forms also force a paper return.
• You have slips or income from more than one country, or self-employment income.
• You owe a balance and no longer have a Canadian bank account.

Gather: every Canadian slip, your exact departure date, your new foreign address, your last notice of assessment, account statements valued on the departure date, and your SIN. Which income and credits go on the return is covered in the part-year return guide.

Which return do I file for the year I leave Canada?

Use the general income tax package for the province or territory where you lived on the day you left. Do not use the non-resident package, which is for people who were non-resident all year. The CRA's emigrant page sets this rule and asks for the departure date on page 1.

If you lived in Québec, you also file a Québec return; see leaving Québec. Credits that depend on living in a province on December 31 generally do not apply to the year you leave; the part-year return guide explains which.

Can I file my emigrant tax return online with software?

Often yes, through a tax preparer using EFILE, but not when departure forms are attached. Under the CRA's EFILE rules, an emigrant return for the recent years listed there is accepted, except one that includes Form T1243, T1244 or T1161, or reports self-employment income on Form T2203. Those go on paper.

Filing it yourself: NETFILE, the service for filing your own return with certified software, does not list emigrants among its restrictions, but the same page routes the provincial return by where you lived on December 31, which does not fit a departure year. The CRA's pages leave it unclear, so confirm before relying on NETFILE. It also cannot change your address, while a paper or EFILE return can. Both services list accepted tax years and change their rules each season.

Where do I mail my emigrant tax return from outside Canada?

Mail a paper departure return to the tax centre on the CRA's emigrant mailing list, which the CRA's emigrant page points to. It sorts by the province or Ontario area you left: the western provinces, the territories and several Ontario cities go to the Winnipeg Tax Centre; the Atlantic provinces, Québec, Toronto, Barrie and Sudbury go to the Sudbury Tax Centre. The CRA's general mailing page sorts non-resident returns by country instead, so if the two point to different centres, confirm with the CRA. Copy the full address on the day you mail.

The general page also says the CRA is temporarily accepting non-resident income tax returns by fax because of international mail delays. It does not say this covers a departure-year return, so confirm with the CRA before faxing one instead of mailing it.

A return sent by first-class mail or its equivalent is treated as received on the day it was mailed (Income Tax Act, s. 248(7)). Whether a given foreign postal service counts as the equivalent is not spelled out. Use a tracked postal service rather than a private courier (the rule speaks only of mail), keep the dated receipt, and keep a full copy of what you sent.

How do I get my T4, T5 and other slips from outside Canada?

Most slips appear in your CRA account once the issuer files them and the CRA processes them; signing in from abroad is covered in CRA My Account from outside Canada. If a slip is missing, ask the issuer (your former employer, bank or broker) to send it to your new address or online.

Update your address with each issuer and the CRA before slips are mailed. The CRA accepts address changes online in your account, by phone (from outside Canada and the US, collect calls through an operator), on a paper or EFILE return, or on Form RC325 (CRA: Change your address).

How do I pay a balance owing from abroad without a Canadian bank account?

Wire Canadian dollars to the Receiver General for Canada using the bank details on the CRA's wire transfer page. The page gives the steps that keep a payment from going astray:

1. Send the wire in Canadian dollars.
2. Set the charges field to OUR, so your bank's fees are not taken out of the amount the CRA receives.
3. In the description field, enter the CRA's authorization number shown on that page, then your SIN, full legal name, phone number and the tax year.
4. Fax the CRA a copy of the bank's confirmation, with the payment date, amount and confirmation number, to the number on that page.

A wire counts as paid when the CRA receives it, not when you send it, so send it several business days before the due date. A wire that arrives short because fees were deducted leaves a balance that keeps drawing interest. If you still hold a Canadian bank account, you can pay from it as you did before you left.

When is the emigrant return due, and what if I was self-employed?

The return and any balance are due April 30 of the year after you leave. If you, or your cohabiting spouse or common-law partner, carried on a business in the year (other than one whose spending was mainly on tax shelter investments), the filing date moves to June 15, but the balance is still due April 30 (CRA: Filing due dates; Income Tax Act, s. 150(1)(d)).

When a due date falls on a weekend or a CRA-recognized holiday, a return received or postmarked by the next business day is on time, and a payment received on the next business day is on time.

A return filed late with a balance owing draws a penalty of 5% of the unpaid tax plus 1% for each full month late, up to 12 months (Income Tax Act, s. 162). Late departure forms carry their own penalties; see late departure forms and penalties.

Can a tax preparer in Canada file my departure return for me?

Yes. A preparer can file the return for you, by EFILE where the rules allow or on paper you sign. For EFILE you first sign Form T183, which lets the preparer send the return electronically; it does not let them speak to the CRA for you. To let the preparer also speak to the CRA about your account, authorize them; the three main ways are below, and the CRA lists others (CRA: Authorize a representative):

If you cannot sign in from abroad, a representative's request can still be confirmed with details from a notice of assessment for a return the CRA processed at least six months ago; Form AUT-01 also works but gives offline access only. What drives the fee is covered in the cost of a departure tax return. For CRA questions by phone from outside Canada and the US, the CRA takes collect calls through an operator at the number on its contact page.

Do I have to keep filing Canadian returns after this one?

Not automatically. After the departure year, you are non-resident all year, and you must file only if, for example, you owe Canadian income tax for the year, have a taxable capital gain or sell property Canada still taxes after you leave (taxable Canadian property), other than in an excluded disposition, or have a Home Buyers' Plan or Lifelong Learning Plan balance at year end (Income Tax Act, s. 150(1.1)(b)(i), (iii) and (iv)). Much Canadian income paid to non-residents is taxed by withholding instead of on a return.

Which later returns fit, and how to catch up on missed ones, is covered in non-resident Canadian returns and catch-up. For refunds paid abroad, see tax refunds as a non-resident.

Example

These examples are illustrative; all figures are in Canadian dollars.

A teacher moves to Japan in July

She has one T4 and a small bank account, owns nothing that needs Form T1161 or T1243, and expects a refund of about $800. She files the package for her former province, enters her July departure date, and, if the CRA's EFILE list accepts emigrant returns for her year, has a preparer EFILE it, adding her Japanese address on the return; otherwise she mails it.

A couple moves to the UK with a $250,000 brokerage account

Each spouse files their own departure return. Their shares are deemed sold on departure, so each return carries Form T1243 and Form T1161, and each must go on paper. They mail both returns by tracked post to the tax centre the CRA's emigrant list gives for the province they left, before April 30. Each owes $9,000; each sends a separate wire in Canadian dollars with charges set to OUR, puts the authorization number and their own SIN, name, phone number and tax year in the description, and faxes their own bank confirmation.

A freelancer moves to Mexico mid-year

He ran a business in Canada until he left. His filing date is June 15, but his balance of $3,000 is due April 30. If his full $3,000 reaches the CRA by April 30, no interest runs on it, even though he files in June.

Different for you?

• Your return carries T1161, T1243 or T1244: see Form T1161 and Form T1243 and the departure gain, and get individual tax help before you mail a paper return from abroad.
• You have slips or income from two countries: the part-year rules are in the part-year return guide; a return mixing countries' income is a case for individual tax help.
• You owe a large balance and have no Canadian account: follow the wire steps above, and get individual tax help if a payment came in short or late.
• Your spouse or children are staying in Canada: see family stays in Canada while you work abroad; if you are unsure you stopped being resident, see Canadian tax residency.
• Your SIN has expired or you never had one: see filing without a valid SIN.
• You filed the departure return or forms late: see late departure forms and penalties.
• You lived in Québec: see leaving Québec.
• You missed returns for later years: see non-resident returns and catch-up.
• You want the full picture of leaving: start with the leaving Canada checklist.