Your First Tax Return After Moving to Canada
You landed partway through 2025, started working in the fall, and now you have a T4 slip and a return that asks questions the slip does not answer. It wants a date of entry. It wants your income from before you arrived. It asks about property you still own in another country.
The part that catches most people: whether you file a Canadian return has nothing to do with what permit or status you hold. It turns on whether you became a resident of Canada for income tax purposes, which the Canada Revenue Agency (CRA) decides by looking at your ties here. The general mechanics in this beginner’s guide to filing in Canada still apply. What follows is what is different about the first one.
Bottom Line Up Front
- Canadian tax residency is decided by residential ties: a home here, a spouse or common-law partner here, dependants here (CRA, 2026). It is a question of fact, not a status you apply for.
- From the date you became a resident, you report world income. Before that date, only certain Canadian-source income (CRA, 2025).
- Most federal personal amounts are prorated by the days you were resident, unless 90% or more of your income for the non-resident part of the year was Canadian-source (CRA, 2025).
- You do not file Form T1135 for the tax year you first became a resident (CRA, 2026).
- Some benefits need an application in year one, not just a return. The 2025 return was due April 30, 2026, or June 15, 2026 if you or your spouse were self-employed, balance still due April 30 (CRA, 2025).
On this page
- Residential ties decide it, not your permit
- The date you became a resident
- Part-year residency and the prorated personal amounts
- Worked example: arriving June 8, 2025
- Do you actually have to file?
- Benefits you have to apply for in year one
- Foreign income, foreign property, and the T1135 break
- Foreign tax paid and treaties
- SIN, deadlines, and what to gather
Residential ties decide it, not your permit
CRA looks at where your life is, not at what document let you board the plane. Residence status is a question of fact, and holding a permit or landed status counts only alongside other ties (CRA, 2026). Two people who arrived on the same day with the same paperwork can land on different sides of the line. CRA splits the ties into two groups.
| Tie type | What counts |
|---|---|
| Significant | A home in Canada; a spouse or common-law partner in Canada; dependants in Canada |
| Secondary | Personal property such as a car or furniture; social ties such as memberships; economic ties such as a Canadian bank account or credit card; a Canadian driver’s licence; a Canadian passport; provincial health insurance |
Source: CRA, 2026.
Any one significant tie usually settles it. Secondary ties are weighed as a group. If you signed a lease, opened a bank account, and got an Ontario health card in your first month, you are almost certainly a resident for tax purposes from that point.
What to do: write down the ties you formed and the month you formed each one. If your case is genuinely unclear, for example you left your family and your home behind and expect to return within a year, you can ask CRA for a written opinion on Form NR74, Determination of Residency Status (Entering Canada).
The date you became a resident
Your return asks for one date, and that date splits your year in half. You become a resident of Canada for income tax purposes when you have enough residential ties here, and for most newcomers that is the first day you live in Canada (CRA, 2026). It goes on the first page of the T1.
After the date you are taxed on world income, meaning income from all sources inside and outside Canada, in Canadian dollars. Before it you are taxed only on certain Canadian-source income: employment income earned in Canada, income from a business carried on in Canada, and taxable capital gains from disposing of taxable Canadian property (CRA, 2025).
That is the reassuring half of the answer. Your salary from January to the week you arrived is not taxed by Canada. You may still have to state it, which is a different thing.
What to do: fix the date before you touch any numbers. Pull your boarding pass, your lease start date, or your first day of work, and keep whatever proves it with your tax file.
Part-year residency and the prorated personal amounts
This is the calculation newcomers get wrong more than any other. Because you were resident for only part of 2025, most federal non-refundable tax credits have to be prorated: take the days you were a resident of Canada, divide by 365, multiply by the maximum amount (CRA, 2025). Claim the full basic personal amount on a part-year return and CRA will reassess you.
Not everything gets prorated. Credits tied to something you actually paid while you were here are claimed in full for that period, including CPP or QPP contributions, EI premiums, the Canada employment amount, tuition fees, student loan interest, medical expenses, donations and gifts, and the pension income amount (CRA, 2025). It is the fixed personal amounts, the basic personal amount above all, that shrink.
The 90% rule, in plain language
There is one escape hatch. You can claim the remaining federal credits in full if the Canadian-source income you report for the part of the year you were not a resident is 90% or more of your net world income for that part of the year (CRA, 2025).
Read the denominator carefully. The test looks only at the months before you became a resident. So the question is not “did I earn most of my 2025 income in Canada”, it is “in the months before I moved, was almost all of my income already Canadian”. For most people working abroad until the day they flew in, the answer is no, and the amounts get prorated. On a paper return, CRA asks you to attach a note stating your net world income in Canadian dollars.
What to do: count your days of residency exactly, then run the 90% test against the pre-arrival period only.
Worked example: arriving June 8, 2025
Suppose you moved to North York on June 8, 2025 and started work in July. From January to early June you worked in your home country and earned the equivalent of $20,000, with no Canadian income. From June 8 to December 31 you earned $38,000 in Canada.
You were a resident for 207 days of 2025. Your pre-arrival Canadian-source income was $0 out of $20,000 of net world income for that period, so you fail the 90% test and have to prorate.
| Step | 2025 figure |
|---|---|
| Maximum federal basic personal amount | $16,129 |
| Days resident in Canada | 207 of 365 |
| Prorated amount (207 ÷ 365 × $16,129) | $9,147 |
| Federal credit at the 2025 lowest rate of 14.5% | $1,326 |
| Credit if you had been resident all year | $2,339 |
| Difference | $1,013 more federal tax |
The 2025 basic personal amount is $16,129 where net income is $177,882 or less, falling to $14,538 once net income passes $253,414 (CRA, 2025). The lowest federal rate for 2025 is 14.5%, because the rate dropped from 15% to 14% on July 1, 2025 (CRA, 2025). Both change year to year, so check the current figures before you file.
That $20,000 of foreign salary is not taxed in Canada. What it does is cost about $1,013 in personal amounts, which is a much smaller thing than being taxed twice on it.
Do you actually have to file?
You have to file a 2025 return if CRA asked you to, if you have tax to pay, if you want a refund, if you or your spouse or common-law partner want benefits such as the Canada Child Benefit, if you disposed of capital property or realized a taxable capital gain in 2025, or if your net self-employment income plus pensionable employment income was more than $3,500 (CRA, 2025).
If you arrived in November, worked three weeks, and had tax withheld, none of those may apply. File anyway. A first return with a few weeks of income usually produces a refund, it turns benefit payments on, and it opens RRSP contribution room.
What to do: if you are unsure, file. There is no penalty for filing a return you did not strictly have to file, and there is real money on the other side of it.
Benefits you have to apply for in year one
Most Canadians get their benefits by filing. Newcomers are the exception in year one, because CRA has no income history for you, so some benefits need a form before the return.
| Benefit | First year as a newcomer | After that |
|---|---|---|
| Canada Groceries and Essentials Benefit (CGEB), formerly the GST/HST credit | Apply on Form RC151, online or by mail | Automatic once you file each year |
| Canada Child Benefit (CCB) | Apply on Form RC66 with Schedule RC66SCH, mailed to your tax centre with proof of birth | Automatic once you and your spouse file each year |
Sources: CRA on getting the CGEB and CRA on applying for the CCB, both 2026. The CGEB is the GST/HST credit under a new name as of July 2026, so older guidance and your own earlier notices will still call it the GST/HST credit (CRA, 2026).
Two details matter. You can apply as soon as you arrive if you meet the eligibility rules, without having filed a Canadian return first (CRA, 2026). And Schedule RC66SCH asks for your income for the years before you arrived, which is why CRA wants those foreign figures even though it is not taxing them.
From the second year on, both are recalculated every July off the return you and your spouse filed, which is why a missed filing stops the payments. What moves the amount up or down is covered in why a CCB payment can drop.
Foreign income, foreign property, and the T1135 break
From your residency date forward, world income means all of it: foreign employment, foreign self-employment, interest on a bank account you still hold abroad, dividends, rent on a property back home, and foreign pension payments. In Canadian dollars, on the same return, alongside your T4.
Then there is the separate disclosure form. Form T1135, Foreign Income Verification Statement, is required from Canadian residents who at any time in the year owned specified foreign property with a total cost of more than $100,000 (CRA, 2026). Cost, not market value, and totalled across everything rather than per item. Late filing costs $25 per day for up to 100 days, minimum $100 and maximum $2,500 (CRA, 2026).
Here is the detail that takes the pressure off your first return. An individual does not have to file Form T1135 for the tax year in which they first became a resident of Canada (CRA, 2026). It starts the following year. And for later years, the cost of property you already owned when you arrived is its fair market value on the date you became a resident, so a decades-old purchase price never enters the form.
Some things never go on T1135 at all. Personal-use property is excluded, and so is foreign property held inside an RRSP or a TFSA (CRA, 2026). A house abroad that your family lives in is a different case from the same house rented to tenants.
What to do: value your foreign property as at your date of entry and file that valuation away. You need it next year, and reconstructing it later is harder.
Foreign tax paid and treaties
If another country already taxed income Canada is now taxing, you are usually relieved, not doubled. Canada has tax conventions, commonly called tax treaties, with many countries, designed to avoid double taxation and prevent tax evasion (CRA, 2026).
The everyday mechanism is the foreign tax credit. You may be able to claim it if you paid foreign income or profit taxes on income you earned outside Canada and reported on your Canadian return (CRA, 2026). It is calculated on Form T2209 and claimed at line 40500, and it cuts your Canadian tax by roughly what you already paid abroad on that income, capped at what Canada would have charged.
Treaties also decide which country gets first claim on particular income types, pensions especially. That is a per-country question. The mirror image of this situation, Canadian ties while living abroad, is covered in taxes for Canadians living abroad.
What to do: keep the foreign tax assessment or withholding statement. Without proof of foreign tax paid, the credit is hard to support.
SIN, deadlines, and what to gather
You need a Social Insurance Number (SIN) to work, to open most bank accounts, and to receive benefit and credit payments. If Service Canada cannot issue you a SIN, CRA can issue a temporary tax number (TTN), which can be used to get benefit and credit payments, do your taxes, and sign up for a CRA account (CRA, 2026). To get one, file your return or benefit application without a SIN and attach certified identity documents and a letter explaining why you cannot get one.
For the 2025 tax year, the return was due April 30, 2026, or June 15, 2026 where you or your spouse or common-law partner had self-employment income. Either way, a balance owing for 2025 was due April 30, 2026 (CRA, 2025). The later filing date does not buy a later payment date.
What to have in front of you before you start:
- Your date of entry, and something that proves it
- Every Canadian slip: T4, T4A, T5, and T2202 for tuition
- Your foreign income for the part of the year before you arrived, in Canadian dollars, with the exchange rate you used
- Any foreign tax paid, with the assessment or withholding statement behind it
- Foreign property you still own, with its value on your date of entry
- Your SIN or TTN, your Canadian address, and your marital status on December 31
- Rent or property tax paid in Ontario, for the Ontario Trillium Benefit on Form ON-BEN
The ordinary Canadian slips are listed in more detail in this document checklist for a 2025 return.
A fair warning. A first Canadian return with foreign income, prorated credits, and a residency date is one of the harder personal returns there is. Not because you are new, but because three separate rule sets meet on one form and the software does not always ask the right question.
Not sure which half of the year your income falls in? Ruby Tax has been preparing personal returns from 250 Consumers Road in North York for over ten years, and you talk to the person doing the work, not an account manager. Get a free quote or call 647-990-7258. Pricing for personal returns starts at $50.
Common Questions
Do I report the foreign income I earned before I moved?
Not as taxable income. Canada taxes your world income only from the date you became a resident, and before that date only certain Canadian-source income (CRA, 2025). You are still asked for the pre-arrival figure, on the benefit forms and to test the 90% rule. Stating it is not the same as being taxed on it.
What if I had no income at all before I arrived?
CRA’s rule is written as a percentage of your net world income for the part of the year you were not a resident, and its newcomer credits page does not address a period with no income in it. Confirm that one rather than assuming it either way.
My spouse is still living abroad. Does that change my return?
It can change both your residency analysis and your benefits. A spouse or common-law partner in Canada is a significant residential tie, and a spouse outside Canada cuts the other way (CRA, 2026). For the Canada Child Benefit, a spouse who was a non-resident for part of the year means CRA also wants Form CTB9, Income of Non-Resident Spouse or Common-Law Partner for the Canada Child Benefit, with their income for that period (CRA, 2026).
I own an apartment back home. Do I have to tell CRA about it?
Not on your first return, since the T1135 requirement does not apply for the year you first became a resident (CRA, 2026). From the second year it depends on cost and use: personal-use property is excluded, a rented property counts toward the $100,000 threshold, and the rent is taxable world income from your residency date onward.
Where to start
Settle your date of entry first, because every other number hangs off it. Split the year there: Canadian-source income before, world income after. Count your days of residency and prorate the personal amounts unless the 90% test clears you. Get the benefit applications in, since year one needs a form and not just a return.
If your first return carries foreign income, foreign tax paid, or a residency date that is genuinely arguable, that is a fair point to hand it to someone who does these regularly. Start with non-resident and cross-border returns if you are not certain which side of the line you were on for 2025.
About the author
Raj is the principal of Ruby Tax, a CRA e-file certified tax and accounting practice at 250 Consumers Road in North York. He has spent over ten years preparing personal and corporate returns for clients across Canada, from first-time filers to incorporated businesses and franchise operators.
Published October 30, 2026. Last updated October 30, 2026.
This article is general information, not tax advice for your situation. Tax rules change and the right answer depends on your facts. Confirm anything here against current CRA guidance or talk to us before you act on it.
