Returning to Canada – Unwinding a Deemed Disposition
CPABC in Focus Nov/Dec 2017
Canada’s Income Tax Act contains a deemed disposition provision for taxpayers who cease to be residents of Canada. If the individual later returns to Canada and re-establishes tax residency here, a separate deemed disposition provision deems them to have disposed of and reacquired all property (again, subject to certain exceptions) owned immediately before becoming a resident of Canada for proceeds equal to the fair market value of the property at the time of disposition.