Do your investments remain active if you leave Canada?

For many Canadians, investing is an important part of financial planning and wealth accumulation. A question that concerns those who emigrate or leave Canada for an extended period of time is whether their investment accounts remain open and profitable, and what tax, legal, and administrative consequences a change of residency may have. In this article, we will take a detailed look at how different types of accounts and assets are treated, how the terms and conditions of use change, and what steps you should take to optimize the management of your investments after you leave.

1. Tax residency status and its impact on investments

The Canada Revenue Agency (CRA) defines three categories of individuals for tax purposes:

  • Tax resident: lives in Canada for most of the year and has significant ties (home, family, bank accounts).

  • Partial resident: resident for part of the year (year of departure/arrival), with income divided between resident and non-resident.

  • Non-resident: has no significant ties and stays less than 183 days per year.

Your status determines what income and accounts you must report in Canada and how dividends, capital gains, and interest are taxed.

2. Non-resident restrictions and opportunities

2.1 Open brokerage accounts (Taxable Accounts)

  • As a rule, brokerage accounts with TMX-licensed brokers (Questrade, RBC Direct Investing, etc.) remain open regardless of your place of residence.

  • You retain the ability to buy and sell stocks, ETFs, bonds, and other instruments.

  • There may be additional fees for servicing non-resident accounts (ranging from CAD 25 to CAD 100 per year).

  • Taxation: As a non-resident, you are required to pay 25% withholding tax on dividends and interest (Part XIII withholding). Capital gains are taxed at standard rates upon sale.

2.2 Registered Accounts (RRSP, TFSA, RESP)

RRSP

  • Your RRSP remains tax-deferred regardless of location.

  • Contributions after losing resident status are prohibited — excess contributions are subject to penalties.

  • Withdrawals are subject to a 25% withholding tax (Part XIII) without entitlement to personal credits.

  • Conversion to a RRIF is possible upon reaching age 71 with the use of preferential withholding rates.

TFSA

  • TFSA continues to earn tax-free income in Canada.
  • New contributions after loss of resident status are not permitted — penalty of 1% per month of the excess amount.
  • Withdrawals are tax-free, but income may be taxable in the new country depending on local rules.

RESP

  • If you are an RESP sponsor, your contributions remain invested and continue to grow.

  • Eligibility for CESG (Canada Education Savings Grant) grants ceases after a longer period of non-residence.

  • Payments to the student (beneficiary) remain tax-free when they receive payments in Canada, but in the case of a non-resident beneficiary, you should check the tax implications in the new jurisdiction.

3. Currency and operational risks

3.1 Currency exposure

  • If your assets are denominated in CAD, a decline in the CAD against the USD, EUR, or UAH will affect the value of your portfolio in the currency of your new country.
  • Consider currency risk and possibly hedge part of your exposure through currency ETFs or forward contracts.

3.2 Trading hours and market access

  • The vast majority of brokers allow you to trade online from anywhere in the world.
  • Pay attention to market opening times (EST) and possible VPN restrictions or the risk of blockages.

4. Tax planning and international agreements

4.1 Foreign Tax Credit and tax agreements

  • Dividends and interest taxed in Canada (Part XIII) may be credited as a foreign tax credit in your new jurisdiction, subject to the provision of tax withholding certificates.

  • Check if there is a double taxation agreement between Canada and your new country (e.g., Canada–Ukraine, Canada–Poland) to minimize the withholding rate and avoid double taxation.

4.2 Deemed disposition and departure tax

  • When you emigrate, your assets are deemed disposed of at market value, including stocks, funds, but with exceptions (private real estate, RRSPs, TFSAs, etc.).

  • Half of the capital gain is included in taxable income, which creates a departure tax liability.

5. Practical recommendations

  1. Do not close your accounts in a hurry: leave them open to avoid portfolio restructuring and tax losses.

  2. Review your services: discuss fees and non-resident status with your broker; it may be worth consolidating your accounts with a single provider.

  3. Update your contact details for correspondence and tax documents.

  4. Hedge currency risk: for long-term portfolios, consider currency ETFs or forward contracts.

  5. Consult with international tax professionals: more complex situations (deemed disposition, double tax treaties) require professional advice.

Conclusion

When you leave Canada, you can continue to use your investment accounts, but your rights and tax obligations will change. Keep your brokerage and registered accounts open, plan to convert your RRSP to a RRIF, avoid excessive contributions to your TFSA, and manage your currency carefully. A thorough understanding of tax treaties, foreign tax credit mechanisms, and departure tax will help minimize costs and ensure the smooth growth of your investment portfolio regardless of where you live.