Capital Gains Tax
#1
Just Joined
Thread Starter
Joined: Nov 2019
Posts: 6
Capital Gains Tax
Hi,
I am planning on moving to Ireland this summer. As we have a house to sell here in Canada do I have to stay in Canada until the house is sold and funds deposited into my bank account before I can fly out? I have been told that is what I will need to do to avoid capital gains tax but I just wanted to be sure.
Also on a side note, has anyone used a shipping company that they have been happy with from Vancouver to UK/Ireland?
Thanks
I am planning on moving to Ireland this summer. As we have a house to sell here in Canada do I have to stay in Canada until the house is sold and funds deposited into my bank account before I can fly out? I have been told that is what I will need to do to avoid capital gains tax but I just wanted to be sure.
Also on a side note, has anyone used a shipping company that they have been happy with from Vancouver to UK/Ireland?
Thanks
#2
BE Enthusiast
Joined: Dec 2010
Location: Whitby, Ontario
Posts: 730
Re: Capital Gains Tax
Sorry - can’t answer your question but someone recently asked about moving a large amount of money from Canada to the UK after they had left Canada - it seemed impossible to do remotely and they ended up having to make a short trip back just to liaise with the bank and arrange the transfer. Something to be aware of or at least check before you leave.
#3
Just Joined
Thread Starter
Joined: Nov 2019
Posts: 6
Re: Capital Gains Tax
I actually saw that after I posted and was saying to my daughter maybe I would stay to make that an easier thing to deal with!
#4
Re: Capital Gains Tax
HI
1. You really don't want to be classified as a non residence when you sell your property.
2. Here is an article about NR selling real property
Canada Revenue Agency’s (CRA) guidelines state that a person is considered a non-resident (NR) for tax purposes if he/she is:
Hi,
I am planning on moving to Ireland this summer. As we have a house to sell here in Canada do I have to stay in Canada until the house is sold and funds deposited into my bank account before I can fly out? I have been told that is what I will need to do to avoid capital gains tax but I just wanted to be sure.
Also on a side note, has anyone used a shipping company that they have been happy with from Vancouver to UK/Ireland?
Thanks
I am planning on moving to Ireland this summer. As we have a house to sell here in Canada do I have to stay in Canada until the house is sold and funds deposited into my bank account before I can fly out? I have been told that is what I will need to do to avoid capital gains tax but I just wanted to be sure.
Also on a side note, has anyone used a shipping company that they have been happy with from Vancouver to UK/Ireland?
Thanks
2. Here is an article about NR selling real property
Canada Revenue Agency’s (CRA) guidelines state that a person is considered a non-resident (NR) for tax purposes if he/she is:
- Normally, customarily, or routinely live in another country and are not considered a resident of Canada; or
- Do not have significant residential ties in Canada; and
- lived outside Canada throughout the tax year; or
- stayed in Canada for less than 183 days in the tax year.
#5
Just Joined
Joined: Dec 2019
Posts: 15
Re: Capital Gains Tax
We have recently looked into this scenario and sought the advice of an accountant in BC. Yes, you do have to sell your house before you move back to Ireland or the UK to avoid paying capital gains. This is also the case for a car or anything else that the Canadian government deems to be of a high value e.g expensive jewelry etc.
Hope that helps.
Hope that helps.
Last edited by Mrchuffie1; Dec 30th 2019 at 6:55 pm.
#6
Just Joined
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Joined: Nov 2019
Posts: 6
Re: Capital Gains Tax
Thanks all I figured that was the case that I needed the sale to be completed before the move. I'll have to hit up a hotel for a few days after the sale is completed and clear up the loose ends
#7
Forum Regular
Joined: Dec 2019
Posts: 30
Re: Capital Gains Tax
So if we sell our house, live in a hotel for a week, and file the sale of our house that week, we do not have to pay capital gains tax?
How does this work on the end of 2020 year tax return. it asks if you sold a house the prior tax term?
We move back to England the end of May after 14 years in Ontario.
Also if you are owed money on your return but are no longer in Canada, how does that work?
How does this work on the end of 2020 year tax return. it asks if you sold a house the prior tax term?
We move back to England the end of May after 14 years in Ontario.
Also if you are owed money on your return but are no longer in Canada, how does that work?
#8
Forum Regular
Joined: Dec 2019
Posts: 30
Re: Capital Gains Tax
Okay, I am now very confused. I have just been to emigrates part of CRA website, and that is saying that if you sell your property in the year you become a non residence, then yes you do have to pay capital gains tax on the profit of your house.
#9
Just Joined
Joined: Dec 2019
Posts: 15
Re: Capital Gains Tax
I think I may have got a bit confused between talking about capital gains and the departure tax. If you become a non-resident of Canada then you may have to pay a departure tax on the sale of your property, but only if you sell it after leaving Canada. For example, if you have a property worth $400,000 and it sells when you are in the UK then the CRA will withhold 25% of the house's sale value = $100 000. I believe that the departure tax also applies to other expensive items like cars etc which may sell after you have left.
If you sell the property before you leave for the UK, then this tax will not apply. My accountant says it is wise to sell your house long before you leave for the UK as she knows of people who sold their house and left the next day and ended up getting charges the 25% tax.
Capital gains tax on a property does not apply to the profit you make on your home as long as it was your principal or main residence.(this is from the government website).
So to be safe sell your expensive items before you leave. Also, make sure that you know what to do with any RRSPs and similar investments.
I would strongly suggest that you find an accountant who is familiar with this stuff. We lucked out and found a really good one who was in the process of helping her English aunt to move back to the UK.
I am no expert on this and can only tell you what I have learnt myself, so please double check as it's a big move. I'm not sure if I can suggest YouTube or not here. However, we did find a good video by Alan Madden called Becoming a non- resident of Canada. HE LISTS ALL THE FORMS YOU NEED TO FILL OUT AND WHEN TO DO THIS..
I hope this helps.
#10
Forum Regular
Joined: Dec 2019
Posts: 30
Re: Capital Gains Tax
Thank you that makes much more sense.
We was thinking of having sale close 2 weeks before leaving so we could make sure we settled all bills ect.
I will see what experts we have locally to reach out and speak with
We was thinking of having sale close 2 weeks before leaving so we could make sure we settled all bills ect.
I will see what experts we have locally to reach out and speak with
#11
Just Joined
Joined: Dec 2019
Posts: 15
Re: Capital Gains Tax
Yes, it's all a bit of a kerfuffle. We went to one accountant who was useless and knew nothing about it all. The next person we found was great. However, I made a point of emailing her all my questions and she researched it and sent the answers back in writing which meant we could refer to those answers in a more concrete way i.e refer directly to any answers to ask for clarification. For us this worked better than talking and listening in person where we previously found ourselves rushing to scribble down info and often missing what was said. Anyway, I'm sure you will do what works best for you
We are still trying to find out about how our Canadian pensions will be affected.
All the best to you.
We are still trying to find out about how our Canadian pensions will be affected.
All the best to you.