Can I reclaim capital gains (departure tax) paid in Canada?

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DanyBoy88

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Hi,

I am looking to move back to Ireland from Canada.

While living in Canada I purchased a rental property in Ireland and setup a company in Ireland.

Canada has a departure tax - on the day you leave the country they deem that you have disposed of all the assets you acquired while you were living in the Canada.

This deemed disposition basically means I would have to pay capital gains in Canada on the rental property and shares of the Irish company, even though these assets have not actually been sold.

I know Ireland and Canada have a tax treaty.

Just wondering does anyone know if the capital gains paid in Canada on the deemed disposition of the assets can be credited against capital gains due in Ireland when the assets are actually sold in the future?

Does Ireland recognize the new step-up cost base that was assigned to the property and shares by Canada on the day of emigration (deemed disposition)?

Thanks
 
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My understanding is that through the tax treaty Canada Revenue can force Irish Revenue to collect it if it's not paid? Does anyone know how this works?
 
It looks like you can defer the tax without interest until you actually sell the property years later. But you may need to provide security in the form of a bank or legal guarantee.

I’d be surprised if most people don’t just do a runner without paying. I have never heard of the Canadian authorities forcing the Irish authorities to do anything.

Just looking at the Treaty, it seems that most assets are rebased for Irish tax purposes, but not Irish property.

I guess the ‘deferral’ or ‘runner’ options are the main ones people go for.

I’d get professional advice.
 
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The security they require to defer payment is very hard to get especially on foreign assets.

You don't think foreign revenue agencies can force Irish Revenue to recover tax owed?
 
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