Residential ties

The most important thing to consider when determining your residency status in Canada for income tax purposes is whether or not you maintain, or you establish, residential ties with Canada.

Residential ties with Canada are typically seen as primary or secondary.

Primary (significant) residential ties to Canada include:

    • a home in Canada
    • a spouse or common-law partner in Canada; and
    • dependants in Canada;

Secondary residential ties that may be relevant include:

    • personal property in Canada, such as a car or furniture;
    • social ties in Canada, such as memberships in Canadian recreational or religious organizations;
    • economic ties in Canada, such as Canadian bank accounts or credit cards;
    • a Canadian driver’s license;
    • a Canadian passport; and
    • health insurance with a Canadian province or territory.

The residential ties you establish or maintain in other countries may also be relevant.

It is important that you sever all primary residential ties when ceasing residency. Maintaining any significant primary ties can cause the Canada Revenue Agency (CRA) to consider you as a resident for income tax purpose.