For those planning to leave Canada, this is a must-read! Understanding departure tax is essential for a smooth departure!

How to avoid receiving various letters from the CRA in the future? Remember to do these three steps before leaving the country for peace of mind!

Many friends often receive letters unexpectedly after leaving Canada:

👉 "Why am I still being asked to file taxes even though I've already left?"

👉 "Why did I receive a tax notice?"

👉 "I don't live here anymore, do I still need to file taxes?"

To avoid these troubles, simply do these three things carefully before leaving the country!

✅ Step 1: File your "last year's" tax return, also known as the departure tax.

This means you need to file a tax return the year you leave Canada. In this departure tax return, be sure to:

✔ Indicate your departure date (from which date you cease to be considered a tax resident)

✔ Declare your Canadian income for the entire year

✔ Declare your worldwide income for the year (only the portion before departure)

🔎 Many people overlook the "departure date," causing the system to continue treating you as still in Canada.

✅ Step 2: Clarify your tax status after departure

After leaving Canada, you have two possible statuses, and the tax rules are completely different for each!

🅐 Still considered a Canadian tax resident:

Your family is still in Canada

Your primary residence or long-term property is in Canada

Your center of life is still in Canada

Your work may be overseas, but the system may still consider you a resident

👉 In this case, you still need to continue filing as a tax resident.

🅑 Considered a non-resident:

Your family, income, and center of life have moved to another country.

Your ties to Canada have decreased to "short-term stays" or "investment-related."

👉 In the future, you will only need to handle taxes on "income from Canadian sources," such as: renting out Canadian property, capital gains from selling property, certain investment income, etc.

✅ Three steps: Proactively explain your departure status in the system.

This is a crucial step!

✔ Accurately fill in your departure date in your annual tax return for the year you left Canada.

✔ Update your mailing address in the CRA system (don't let letters be sent to your old home anymore).

✔ If your situation is more complex, you can attach a simple explanation to help the CRA system update your status more quickly.

🔎 Many people don't do this and continue to receive various letters from the CRA years after leaving Canada because their status in the system remains "not updated."