RRSP implications if moving to Ireland?

[seema]

Hi,
We are moving to South Ireland and are trying to figure out the RRSP, tax implications. Does anyone know if Ireland acknowledges RRSP accounts and how we transfer these without paying enormous taxes on them?

Thanks.
Seema

[Steven]

Only the US has a provision in their tax treaty covering RRSPs. If you move anywhere else they are not recognized as a tax shelter (although this may not matter if you move somewhere that doesn't tax things like that, e.g. The Bahamas). So any income from them is subject to tax and if you sell them after you move your tax home they will be subject to capital gains tax, usually, not sure in Ireland how their CGT works.

The more relevant problem is how the CGT is calculated, the US-Canada tax treaty calculates the capital gain from the date of the move, not the date of acquisition, you'd need to see if there is a corresponding provision otherwise you could be subject to CGT on the full capital gain if you close out your RRSP after you move. (Really depends on the Irish CGT rate, chances are it will be less than Canadian income tax if you close it out now, but it depends how long you've had your RRSP and how Irish tax law works).

You also need to read up on departure tax, which is CGT applied at the point of departure. Stuff in Canadian tax shelters is exempt from departure tax and so is your principal residence.

http://www.cra-arc.gc.ca/tx/nnrsdnts/nd ... n-eng.html

Most countries (and Ireland is probably one of them) have specific provisions regarding the portability of pension provisions but that's not necessarily directly related to RRSPs per se, you'd need to talk to the Irish tax authorities.

This is the treaty: http://www.fin.gc.ca/treaties-conventio ... _2-eng.asp

Article 18 appears to be the relevant bit, looks pretty thin to me.