Do I file Form T1244 even if no tax is owed?
Election obligations of this kind are generally required on the facts rather than on the tax result, so a nil position does not remove one. Emigrants whose deemed disposition creates tax on assets they cannot or will not sell — private company shares, illiquid holdings.
What happens if I have missed Form T1244 for several years?
Missed years are dealt with as a package rather than one at a time, because the route chosen for the first year affects the relief available for the rest. We map the years and the obligations before anything is filed.
Is Form T1244 the same as the other reports I already file?
No. Elects to defer payment of the departure tax until the property is really sold, with acceptable security posted. Satisfying a different obligation, even one covering the same accounts or entity, does nothing for this one.
Can I defer departure tax on shares I cannot sell?
That is what the election on Form T1244 does. Emigration triggers a deemed disposition, so tax can fall due on holdings you never intended to sell and, with private company shares, may not be able to sell. The election defers payment until the property is really disposed of. It does not cancel the tax and it does not change the departure-year valuation; it moves the payment date. The CRA expects security to be posted for the deferred amount, and what it will accept is a matter for negotiation rather than assumption. Settle the question of what you can offer as security before the departure-year return goes in, not after.
What does the CRA accept as security for a deferral?
There is no tick-box list. The practical test an officer applies is whether the asset standing behind the security could actually be realised if the deferred tax were never paid, and whether it will still be there years from now. Shares in the same private company that created the deemed disposition are a harder conversation than a charge over Canadian real property. Our work on these files is mostly evidence: a supportable valuation, clean ownership records, and a written proposal that says what is being offered and why. An officer deciding on a documented position asks fewer questions than one deciding on a description.
Is the deferral automatic once the election is filed?
No. Filing the election with the departure-year return starts the process; it does not finish it. The deferral is a security arrangement, so there is correspondence, there are questions about the property and its value, and there is an arrangement that has to be accepted before anyone should treat the tax as deferred. People come to us having filed the form, heard nothing, and assumed the matter closed. It is worth confirming in writing what the CRA understands the arrangement to be, over which property, and what would bring it to an end.
What happens to the deferral if I die while abroad?
The deferral attaches to property, so the events that end it are the events that dispose of that property, and death is generally treated as a disposition. That means the arrangement made on departure is something the executor inherits, along with the security posted for it. This is the part of the election most often left unexamined at the time it is made, and the executor is then reading correspondence written years earlier by someone who is no longer available to explain it. When we file an election we set out in the file what happens on a later disposition and on death, in plain terms, for whoever picks it up.
Can I defer on some assets and pay on others?
Yes, and that is usually the sensible shape. The deemed disposition on emigration can cover a mixture of holdings: listed investments that can be sold, and private company shares that cannot. Where the cash is available, paying is simpler than securing a deferral and living with it for years. Where the asset is illiquid, the election is what stops a tax bill forcing a sale at a price nobody would otherwise accept. The work is going through the departure-year holdings one at a time and deciding, with the reason written down, which side of that line each falls on.
What do I do when I finally sell the deferred property?
Two things happen at once. The deferral ends and the departure-year tax becomes payable, calculated on the departure-year figures rather than the price you have just achieved, which can be higher or lower. Separately, the sale is a transaction in the country where you now live, under its rules, and there may be a Canadian reporting obligation as a non-resident depending on what was sold. The security posted years earlier also has to be released, which does not happen on its own. Tell us before the sale closes rather than after; the ordering of these steps is easier to arrange than to correct.
What is Canada's departure tax?
On the day you stop being a resident, you are treated as having sold most of your property at market value and are taxed on the resulting gain, even though nothing was sold. Several categories are excluded, including Canadian real property, registered plans and certain pension interests. Payment of the tax on the deemed disposition can be deferred by election with security, and property above a value threshold is listed on a departure schedule. See departure tax on leaving Canada.
When does my Canadian tax residency actually end?
On the day your residential ties are severed, which is a question of fact rather than of the date on the boarding pass. The CRA weighs the significant ties first — a dwelling available to you, a spouse or common-law partner, and dependants in Canada — then secondary ties such as licences, memberships, accounts and provincial coverage. Keeping a home available while your family stays is the pattern that most often means residency never ended at all. See departure tax on leaving Canada.
