Moving from Canada to Australia is not just about visas and flights it also means properly closing your Canadian tax life. If this step is done incorrectly, it can lead to double filings, unexpected tax bills, and long-term CRA issues that are completely avoidable with the right preparation.

When you leave Canada, you must file a departure tax return with the CRA. This return covers your worldwide income from January 1 up to your departure date.

After your departure date, Canada generally treats you as a non-resident, meaning:

• You are only taxed on Canadian-sourced income (like Canadian rent or investments)
• Your worldwide income is no longer taxed in Canada

Your departure date is not just your flight date it is the point when you sever your main residential ties with Canada and establish life in Australia.

This includes things like:

• Selling or leaving your Canadian home
• Moving your spouse and dependants with you
• Setting up a permanent home in Australia

The CRA looks at your situation as a whole, not just one factor. If your life clearly shifts to Australia, your non-resident status is usually straightforward.

Tax residency is the key concept that determines how you are taxed.

In simple terms:

• If you live in Australia permanently, you become a tax resident from arrival or shortly after
• Australian tax residents are taxed on worldwide income
• Canadian non-residency means Canada stops taxing most foreign income

The tricky part is timing. If both countries consider you a resident at the same time, the tax treaty helps decide which country has taxing priority and how credits are applied to avoid double taxation.

Before leaving Canada, it is important to update your financial accounts and prepare for non-resident rules.

Key steps include:

• Inform your bank and investment brokers that you are leaving Canada
• Update your address to your Australian address
• Ensure accounts apply correct non-resident withholding tax rules

If you don’t update your status, institutions may incorrectly treat you as a Canadian resident, which can lead to tax reporting issues later.

• TFSA: Stop contributing the moment you leave Canada. Contributions after departure can trigger penalties. The account can stay open, but Australia will tax income generated inside it.
• RRSP: You can keep it and continue deferring tax. Withdrawals later will be taxed in both countries, with credits applied to reduce double taxation.