In summary…
By becoming a resident of Canada, you are taxed on your worldwide income from the first day of your presence, and the Canadian tax authorities considers your assets as sold and then repurchased at their current value Your capital gains prior to arrival are not taxed in Canada. Initially, a notional sale affects most assets; those you held upon arrival are exempt if you have been a resident for 60 months or less.
Quebec falls under a separate agreement: France has concluded a tax treaty with Quebec that is distinct from the convention with Canada. French assets are subject to this treaty according to their nature, and most often It must be declared before it can be defended..
«"We're going to Montreal for five years, we're keeping everything in France: life insurance, portfolio, family home." It's a good strategy, provided you know what Canada sees of these assets upon arrival, what it does with them upon departure, and what France keeps during this time.
1. The arrival: the day Canada resets the clock
Resident from day one, taxed worldwide
The Canada Revenue Agency (CRA) bases residency on ties. Key factors include housing in Canada, a spouse or partner in Canada, and dependent children in Canada; secondary ties (car, bank accounts, driver's license, provincial health insurance) also count. For a newcomer, tax residency begins on the first day they live in Canada, and they then declare their worldwide income (from all sources, in Canada and abroad) for the residency period. Income earned before arrival is not taxed in Canada.
The cost price becomes the value on the day of arrival
According to the CRA, property held before arrival is deemed to have been sold and then repurchased at its fair market value: this price becomes your cost basis for any subsequent disposal. Therefore, keep your valuation records as of your arrival date. Foreign taxes paid may be eligible for a tax credit (form T2209) if the tax treaty does not eliminate double taxation.
For the technician. CRA page "Completing your return for newcomers" (deemed acquisition at fair market value). If the asset is a share in a real estate-focused company or a building located in France, Article 13 §1 of the France-Canada Convention authorizes taxation by France; the Canadian cost basis has no bearing on the calculation of French tax.
Case study: €100,000 purchase price, €250,000 upon arrival
Situation. A French executive moved to Quebec for four years, with a portfolio of French listed stocks acquired for €100,000 and worth €250,000 on the day of arrival. He sold them for €280,000 in the second year.
Issue. Measuring taxable capital gains in Canada.
Strategy. Consider the deemed acquisition on arrival: Canadian cost price €250,000. Assumptions: minority interests outside of real estate-dominated companies (gains on these assets are taxable only in the country of residence, Article 13 §4 of the convention), conversion to Canadian dollars ignored for simplicity, inclusion rate of half.
Result. Canadian capital gain: 280,000 − 250,000 = €30,000, instead of the €180,000 that would have been calculated on the original purchase price. Half taxable: €15,000 instead of €90,000. Illustrative example, calculated using the rules in force on 23/10/2026. The inclusion rate of half is that administered by the CRA; the Canadian government announced on March 21, 2025 the cancellation of the planned increase.
2. Declare: Canada is looking at what you have outside its borders
Form T1135 for amounts over 100,000 Canadian dollars
Any resident who holds more than CAD 100,000 of "specified foreign property" (at cost) must file Form T1135. The list includes bank accounts outside Canada, shares of non-resident corporations, and receivables from non-residents. a life insurance policy issued by a foreign insurer ; Personal use goods are excluded. The form must be filed on the date of the income tax return: no later than April 30 for most individuals, and June 15 for self-employed workers and their spouses.
This is the point of intersection between a French contract and the Canadian tax authorities: your French life insurance policy, securities account, and savings accounts are taken into account in the calculation. For the reverse obligation, on the French side, see accounts and contracts abroad.
For the technician. Assets held in a registered retirement savings plan (RRSP) or a tax-free savings account (TFSA) are excluded from the T1135 list. The Canadian treatment of income from a French contract, a retirement savings plan (PER) or a share savings plan (PEA) is not detailed in the Canada Revenue Agency pages we consulted: we do not state it here, and it must be verified on a contract-by-contract basis.
3. The Convention and Quebec: Two texts, one same tie-breaking order
What the texts stipulate
The France-Canada Convention was signed in Paris on May 2, 1975, and has been in force since July 29, 1976; it was amended in 1987, 1995, and 2010 (the latest amendment came into force on December 27, 2013). Quebec is governed by a separate agreement, signed on January 1, 1995.st September 1987 and supplemented by an amendment signed in Paris on September 3, 2002, in force since 1 August 2005.
- Double residence: permanent home, then center of vital interests, then habitual residence, then nationality, then agreement between the authorities.
- Dividends: withholding capped at 5 % for a company holding at least 10 % of the capital, 15 % in other cases.
- Real estate : taxable in the country where it is located; other assets: country of residence of the transferor.
- Former residents: Article 13, paragraph 5, allows each State to tax, according to its domestic law, gains realized by one of its nationals or by a former resident of ten years or more who has become a resident of the other State, provided that the former resident was a resident of that State at some point during the five years preceding the transfer. France's use of this clause is not examined here.
For the technician. France-Canada Convention: Articles 4 §2, 10 §2, 13 §§1, 4 and 5, 18, 23 (Canada deducts French tax; France grants a tax credit). Consolidated text from the Canadian Department of Finance, not official; Article 18 §1 reserves the taxation of pensions paid for prior employment to the State of origin; §3 does the same for annuities (confirmed by the BOFiP commentary, version of September 12, 2012). France-Quebec Agreement: Article 4 (residence), Article 10 (dividends), Article 13 (earnings).
4. Leaving Canada: exit tax and the 60-month rule
A departure triggers a fictitious sale
When you cease to be a Canadian resident, Canada treats you as having sold most of your assets at their market value on the day of your departure. Excluded are, among other things, real estate located in Canada, registered plans (pension plans, RRSPs, TFSAs, and similar accounts), and Canadian life insurance policies. The final exception, and the one of greatest interest to temporary expatriates, is that assets owned upon arrival, or subsequently inherited, remain outside this scope if you were a resident. 60 months or less during the ten years preceding departure.
Beyond that: a list of assets (form T1161) is required if the value exceeds CAD 25,000; the option to defer the tax until the actual sale (form T1244, before April 30 of the following year) is available, with a guarantee required if the federal tax exceeds CAD 16,500 (CAD 13,777.50 for former Quebec residents). If you subsequently return to reside in Canada, an option exists to cancel the notional sale for any assets you still own.
For the return to France, see return to France from Canada.
Our position
Photographing the heritage on the day of arrival
For a stay in Canada lasting a few years, best practice involves three steps: a dated valuation of each asset upon arrival, filing a T1135 as soon as the threshold is reached, and keeping track of the months of residence from the outset. This ensures you stay within the 60-month residency limit and avoid paying exit tax on your previous assets. In France, departure follows its own rules: residence ties, leave France for Canada, living in Canada and the exit tax. Regarding conventions: France-Canada and France-Quebec.
Related questions
Are my French capital gains acquired before my arrival taxed in Canada? No, according to the CRA: the property is deemed to have been acquired at its fair market value on the day of arrival, and this price becomes the cost basis. Only any increase in value after arrival is taken into account for Canadian calculations.
Do I need to declare my French life insurance in Canada? If your total specified foreign property is worth more than CAD 100,000, you must file a T1135, and a life insurance policy issued by a foreign insurer is considered part of that property. The form is filed according to the income tax filing schedule.
Does a four-year stay subject me to exit tax on my portfolio? This does not apply to assets held upon arrival or those subsequently received through inheritance: the 60-month rule excludes them if you were a resident for 60 months or less in the ten years preceding your departure. Assets acquired during your stay remain eligible.
Are you leaving for Canada or Quebec and keeping assets in France?
The initial consultation is used to date and assess the value of each item before arrival, to categorize what needs to be declared, and to establish a timeline for the necessary procedures. Forty-five minutes, with no obligation.
Are you a notary, chartered accountant, lawyer, or fellow consultant? And a client is leaving for Canada? We act as a co-contractor: the client remains yours, we return the valued inventory and the declaration schedule to you.
Book an appointment
The initial consultation is to establish your exact situation and determine if there is anything that can be done—sometimes there is nothing, and we will say so as well. Thirty minutes, with no obligation.
Book an exchange with Balmont Conseil
Alexis Sagnier, financial and real estate investment advisor, insurance broker, AMF certified. ORIAS 13003497. Updated on 23/10/2026.
Official sources consulted
- Canada Revenue Agency, residency status: https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/determining-your-residency-status.html
- Canada Revenue Agency, Newcomers: https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/individuals-leaving-entering-canada-non-residents/newcomers-canada-immigrants/completing-return-newcomers.html
- Canada Revenue Agency, Disposition of Emigrants' Property: https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/individuals-leaving-entering-canada-non-residents/dispositions-property.html
- Canada Revenue Agency, form T1135: https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/foreign-reporting/foreign-income-verification-statement.html
- Canada Revenue Agency, Notice on the Capital Gains Inclusion Rate: https://www.canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2025/update-cra-administration-proposed-capital-gains-taxation-changes.html
- Prime Minister of Canada, cancellation of the increase (March 21, 2025): https://www.pm.gc.ca/en/news/news-releases/2025/03/21/prime-minister-mark-carney-cancels-proposed-capital-gains-tax-increase
- Canadian Department of Finance, consolidated France-Canada agreement: https://www.canada.ca/en/department-finance/programs/tax-policy/tax-treaties/country/france-convention-consolidated-1975-1987-1995-2010.html
- Department of Finance Canada, 2010 amendment: https://www.canada.ca/fr/ministere-finances/programmes/politique-impot/conventions-fiscales/pays/france-avenant-2010.html
- BOFiP, France-Canada convention: https://bofip.impots.gouv.fr/export/pdf/320964
- BOFiP, France-Quebec agreement: https://bofip.impots.gouv.fr/export/pdf/320963
- National Assembly, Bill No. 1280 (amendment of September 3, 2002 to the France-Quebec agreement): https://www.assemblee-nationale.fr/12/pdf/projets/pl1280.pdf
