Does the company itself pay tax if it stops being resident in Canada?
Yes. A corporation that ceases to be resident in Canada faces its own departure tax on the way out, and it applies to the company's assets rather than to a shareholder's. Emigration triggers a deemed disposition of property, so the company is treated as having sold what it holds at the moment residence changes, and there are additional charges keyed to the corporation's net asset value. The shareholders then have the ordinary consequences of the change of residence to deal with separately. Both sets of consequences want quantifying before the residence date, not after it.
How is corporate departure tax different from personal departure tax?
The charge falls on a different taxpayer and is measured on different property. Personal emigration deals with what an individual owns. Corporate emigration deals with what the company owns, and it brings additional charges keyed to the corporation's net asset value rather than to a gain alone. It is perfectly possible for a shareholder to emigrate while the company stays resident, or for the company to emigrate while the shareholders stay. Establishing which of those is actually intended is the first step, because the planning for each is different.
How long does it take to move a company out of Canada properly?
It is a step planned over quarters, not weeks. The charge is measured on what the company holds at the moment residence changes, so anything that ought to be dealt with beforehand has to be done in an order and with evidence gathered at the time: assets to be sold or distributed, intercompany balances, and the valuations that will support the deemed disposition. Valuations obtained after the event are weaker and harder to defend. We set the sequence out first and work back from the intended date.
Can we just move the directors abroad to change our corporate residence?
Treat that as the thing to be tested. Where central management and control sits is one of the questions, but a company incorporated in Canada does not shed Canadian residence merely because its meetings move, and a change that does take effect brings the deemed disposition and the charges keyed to net asset value with it. The more common practical outcome is an unintended dual residence, with two systems each treating the company as theirs. If the aim is to be taxed elsewhere, that wants planning as an emigration rather than arriving at by accident.
What valuations do we need before a corporate emigration?
Enough to support a deemed disposition of everything the company holds at the moment residence changes. In practice that means each class of property valued as at that date with the basis recorded, and particular care over assets that have no market price: goodwill, intangibles developed in-house, intercompany receivables and shares in subsidiaries. Net asset value matters in its own right as well, because there are additional charges keyed to it. Commissioning this work early costs less than reconstructing it later and produces a position that can be defended if it is questioned.
What happens to the shareholders when the company emigrates?
They have the ordinary consequences of the change of residence to deal with, and those are separate from the company's departure tax. The company's charge discharges nothing at the shareholder level, and shareholders may sit in different countries with different treatment of the same event. Where the shareholders are also the directors and the reason for the move, it is worth setting the two sets of consequences out side by side before the date is fixed, because the answer sometimes changes what the group decides to move.
Do I pay Canadian tax if I live abroad?
Only if you remain a Canadian tax resident. Residency follows your ties rather than your address, so leaving while your home and family stay usually does not end it. Non-residents remain taxable on Canadian-source income — employment or business income earned in Canada, dispositions of taxable Canadian property, and passive amounts subject to withholding. The year you leave is its own exercise, with a deemed disposition and its own schedules. See leaving Canada.
What is FAPI, and how does it differ from GILTI?
Canada's foreign accrual property income taxes a Canadian shareholder currently on the passive income of a controlled foreign affiliate — interest, rent, royalties, certain gains — with a deduction that recognises foreign tax already paid on it. GILTI comes at the problem from the opposite side: it targets active income above a return on tangible assets. A group with both a Canadian and a US shareholder can therefore be inside both regimes on different slices of the same profit. See GILTI against FAPI.
