Currency exchange rate

USD –0.03%
EUR –0.14%
JPY –0.16%
GBP +0.13%
CHF –0.42%

Currency exchange rates in CAD on December 24, 2020

Before You Move to Canada

Moving to CanadaThe two items you absolutely “must have” before you even consider moving to Canada is a legal means of residing in Canada (a valid permit) and adequate health care coverage. Without both of these in place, do not even consider a Canadian move.


When moving to Canada, you must have a legal means (valid permit) of entering and remaining in Canada. In order to work, you require the appropriate work authorization as well. Because many Americans come to Canada on a “visitors visa” (good for six months), they mistakenly believe that they can enter and work in Canada. A visitors visa is not physically issued when you cross the border, leaving some to believe they can stay or work as long as they want. In fact, if you are caught working in Canada without a valid work visa, you will be considered an illegal immigrant and could face deportation and lifetime banishment from Canada. Scrutiny in this area has increased significantly since 9/11. You can review your possible visa options in the Immigration section.

Health Insurance

Your normal US healthcare coverage will be of little or no use to you when moving to Canada without some form of travel insurance or foreign coverage. You should check with the province you are going to reside in to determine when you become eligible for provincial health care. For some provinces, coverage begins immediately and for others, there is a waiting period. Either way, you should ensure you have some form of medical insurance to cover yourself in the event of illness or injury in Canada until you become eligible for provincial coverage. You should determine what coverage options you have BEFORE you make the transition to Canada so you clearly understand your risk exposure.

Once you have these two essentials in place, the following must also be considered before moving to Canada:

US Taxes

Mistakenly, many people just stop filing US tax returns when they move to Canada. In fact, it is likely there are continued filing requirements with the Internal Revenue Service (IRS) even when you live outside of the country. The US is one of two countries in the world that taxes based on citizenship rather than on residency. If you are a US citizen or Green Card holder moving to Canada, you must continue filing US tax returns and declare your worldwide income, no matter where you live. In addition, when you become a resident of Canada, CRA will tax you based on your residency and requires you to declare your worldwide income. Now you are in the situation where you are taxed in both the US and Canada!

An analogy may help. Imagine you are the owner of a dinner theatre and Canada Revenue Agency is sitting in the audience. You have one chance to “set the stage” before the curtains open and CRA has full view of your “financial stage.” As soon as you make the transition to Canada, your entire worldwide income is taxable by both the IRS and Canada. When you take up tax residency in Canada, you are opening your “financial stage” for CRA to see. At that point, you can no longer get your “stage” set for their viewing. If you are a US visa holder, we can ensure you appropriately sever your tax ties with the US to ensure you no longer are taxed by the IRS.

Social Insurance Number

In order to work or live in Canada, everyone in your family must have a SIN. The SIN will be required by your employer and the government to file a tax return or pay Child Tax Benefits. See the Income Tax Planning section of this website for more details on obtaining an SIN.

Canadian Taxes

There is much work to be done to minimize these taxes before moving to Canada. If you choose not to do it, you can face compliance issues and unnecessary taxes that can be punishing. The Canada/US Tax Treaty is your protection from double (and triple) taxation in both countries and a thorough understanding of it and its application to your situation is the key to not overpaying your taxes. Further, there is some planning that can be done prior to entering Canada for the first time to give you a 5 year holiday from Canadian taxes!

The bottom line is . . . if you haven’t done the prerequisite planning prior to moving to Canada, many planning opportunities may be lost forever and you will find yourself in a situation where you have to pay many financial professionals on both sides of the border to get yourself back into compliance with both taxing authorities.

Simplify Your Life – This is probably one of the most neglected areas we have seen in dealing with Americans moving to Canada. Before you move, take the opportunity to consolidate all of your investment accounts, IRAs, 401(k)’s and brokerage accounts and reduce yourself down to only one checking account and one savings account. You should also consider selling your home, liquidate as many of your personal assets as possible including your automobiles (see Customs Planning section for more details). Once you are in Canada, the management of your financial affairs in the US will be greatly simplified (i.e. one call to a broker to manage all of your accounts, one checking account to deal with). If you are small business owner, it may be best to sell or wind-up your entity prior to moving to Canada. If that is not possible, try to set-up your affairs so that you are not required to manage the day-to-day operations of the entity.