Do I pay Canadian tax on a house I inherited overseas?
Not on the inheritance itself. Receiving property on a death is not income in Canada, so nothing goes on your return simply because you inherited. What changes is your balance sheet. You now hold a foreign asset, taken at its value at the date of death, and everything that asset does from then on is taxable here in the ordinary way: rent while you keep it, a gain when you sell. It also enters your foreign-property reporting from day one, before any income arises and whether or not you intend to keep it. So the question is not what you owe now, but what this asset does next.
What cost base do I use for property inherited abroad?
For Canadian purposes the property is taken at its value at death, not at what the deceased originally paid. That single figure decides the size of every future gain, so it is worth evidencing properly at the time rather than arguing about it later. A dated valuation, the probate papers and any local transfer documents are the usual support; a family estimate made years afterwards is not. Note that the rule you are applying here is the Canadian one. The country where the property sits may compute its own gain from an entirely different starting point, which is why one sale can produce two different profits and needs both sides worked out together.
Where is the rent taxed on a flat I inherited overseas?
In both places, with relief. The country where the property sits will generally tax the rent as locally sourced income, and Canada taxes it as well because you are taxable here on your worldwide income, with a credit for the foreign tax paid on that same income. The credit is neither automatic nor unlimited. It depends on the foreign tax actually being paid on that income, and on the income being computed for the Canadian return under Canadian rules, which rarely match the local ones. In practice the work is two sets of figures for one property, reconciled, so that the credit claimed can be supported.
Does an inherited foreign property count for foreign-property reporting?
Yes, and it counts from the moment you inherit rather than from the moment it starts producing income. This is an obligation that is often missed, because the property does not feel like an investment. It is the family home abroad, or a share of it, and nobody thinks of it as something to declare. The reporting is about what you hold, so an empty house kept for sentiment sits inside it on the same footing as a let flat, and a part share counts as your share. Get the value at death documented early: it is both your cost base and the figure the reporting starts from.
The inheritance is held through a foreign company, does that matter?
It changes the reporting more than it changes the economics. When you inherit a property directly you hold a property. When you inherit shares in a company that owns the property, you hold shares in a foreign corporation, and the reporting follows what you actually own. The same applies to a trust holding the asset, or to a split interest where somebody else has the use of it. So the first question on any foreign inheritance is what the legal wrapper is, before anyone looks at the building. Advisers abroad often put these structures in place for local reasons that have no bearing on the Canadian consequences.
I inherited a life interest rather than the property, what changes?
Quite a lot, because what you hold is a right rather than a building. A usufruct or life interest gives one person the use and the income while somebody else holds the underlying ownership, and the reporting has to describe the interest you actually have. The income side usually follows the use; the eventual disposal question belongs to whoever holds what is left. These arrangements are ordinary in several civil-law countries and are frequently translated into English, loosely, as ownership. We read the deed rather than the translation, and then decide what is reported and by whom.
What is FIRPTA withholding?
FIRPTA is the US regime that treats a foreign person's disposition of a US real property interest as taxable and makes the buyer withhold on the gross proceeds to secure it. Because the deduction is on the price rather than the profit, it routinely exceeds the real tax — sometimes on a sale made at a loss. A withholding certificate applied for before closing can reduce it to something closer to the actual liability. See the FIRPTA withholding certificate.
Is there an exit tax when a green card holder leaves the United States?
Only for long-term residents — those who held the green card for long enough to be inside the expatriation regime — and then only if one of the covered expatriate tests is met. The step people skip is the formal one: the status has to be properly ended for tax purposes, and until it is, worldwide filing continues no matter where you live. Abandoning the card and forgetting the tax filing is the common, expensive sequence. See giving up a green card.
