Does Cdn departure trigger payment of deferred tax?

Hi,

If I terminate my Canadian residency, does the deemed disposition of shares trigger the inclusion of related deferred income?

For example, if I have exercised and held stock options and deferred the income tax until sale, does emmigration of Canada not only trigger possible capital gain but also the inclusion of that income?

Is the answer the same if the deferred tax was from the gains on a CCPC stock option?

I'm guessing the answers are yes, but just want to check.

- Paul

Yes, I'm pretty sure it does, but check with the CRA because this is a bit more obscure than the average tax question.

Doesn't matter if it's a CCPC. Beware of the fact if you have a controlling interest in a CCPC then you must be resident in Canada for tax purposes to get the CCPC corporate tax rate. This is also one of the things that often causes emigrants a problem, because say you own a CCPC and it has retained earnings of $100,000 and you started it from zero, then that $100,000 is subject to departure tax, i.e. capital gains tax.