Moving from US to Canada [permanently] [India ex-pat in US]

For investors outside the US. Personal investments, personal finance, investing news and theory.
Sister forums: Canada, Spain (en español)
---------------
Post Reply
Topic Author
JD13
Posts: 79
Joined: Thu Nov 01, 2018 8:12 pm

Moving from US to Canada [permanently] [India ex-pat in US]

Post by JD13 »

Note: I added this post in the Canadian version of the BH forum. If the same folks would see it please let me know and I'll delete this post


Hi all I'm looking for some advice here. I'm moving to Vancouver, Canada next week after spending 5 years in the US. I plan to stay in Vancouver, Canada and get my PR and citizenship. There's a very small chance that I might come back in US after a one year [I'd say about 10% chance, depending upon the job market].

I've maintained a portfolio at Fidelity which is shown below.

Cash - 10%
US Domestic equity - 41.19%
International equity - 19.35%
US Domestic Bonds - 28.28%
Taxable
- FXNAX - 6.67%
- FUMBX - 7.60%
- VTI - 41.19%
- VXUS - 19.35%

Roth IRA
- FXNAX - 1.4%

401k
- FXNAX - 13%

Total value of my investments is around 1.38M

I'll be working at a company in Canada which will be giving me RSUs in the US in my Fidelity brokerage [~ 60K worth per year for the next 4 years] and I will be getting a salary in Canada, around 150K per year. I'm 35 years old.

What I'm looking for is some advice on how should I maintain my portfolio going forward. Some of the questions on my mind are
1. Should I transfer all of my assets to Canada? [I'm hesitant to do this since there maybe a small chance I'd have to return in a year]
2. Is it possible to maintain a 3 fund portfolio spread across US and Canada?
3. I'm mostly at a loss right now and I'm looking for some general advise on the best direction forward.
4. Also wondering whether a financial advisor would make the most sense in my case.

Citizenship: Indian

Stock symbols
VTI - Total US stock market
VXUS - Total Internal stock market
FXNAX - Total US Bond
FUMBX - Short term treasury
Last edited by JD13 on Fri Sep 11, 2020 9:01 pm, edited 1 time in total.
000
Posts: 2248
Joined: Thu Jul 23, 2020 12:04 am

Re: Moving from US to Canada [permanently]

Post by 000 »

Your current citizenship(s) may be relevant.
User avatar
Callisto
Posts: 30
Joined: Tue Apr 14, 2020 12:24 pm

Re: Moving from US to Canada [permanently]

Post by Callisto »

I have dual citizenship, and while I was earning income in Canada, I ended up keeping most of my assets, and all invested assets, in the US. If you don't have US citizenship, or you are willing to give up your US citizenship, your tax situation would be much different.

Generally, in this kind of situation, you end up having to report your income to both countries, BUT, you generally don't get double taxed. If you get taxed in Canada for that income, you'll be able to write it off the Canadian taxes you've paid on your US taxes, because Canadian taxes are generally much higher. One exception to this that this significantly complicates Canadian tax advantaged accounts. While I don't think you need a financial advisor, I think talking to someone regarding tax implications might make sense.

I kept my investments in the US because taxes are generally lower, so I saw so reason to mess around with trying to move all my assets to Canada. I prefer investing in the US economy anyways, so I saw no reason to explicitly buy Canadian versions of the S&P500 when I was already invested in it. You can certainly balance your portfolio across both countries, you'd just need to do some currency conversion in your calculations.

Also, US brokerages are far more competitive in terms of fees and customer service; the Canadian division of Fidelity is NOT completely identical to the US version. You are probably used to no fees and excellent customer service, don't take that for granted in Canada.
columbia
Posts: 2903
Joined: Tue Aug 27, 2013 5:30 am

Re: Moving from US to Canada [permanently]

Post by columbia »

I'm thoroughly envious.
Topic Author
JD13
Posts: 79
Joined: Thu Nov 01, 2018 8:12 pm

Re: Moving from US to Canada [permanently]

Post by JD13 »

I don't have a US citizenship. I have Indian citizenship
Topic Author
JD13
Posts: 79
Joined: Thu Nov 01, 2018 8:12 pm

Re: Moving from US to Canada [permanently]

Post by JD13 »

Callisto wrote: Fri Sep 11, 2020 8:52 pm I have dual citizenship, and while I was earning income in Canada, I ended up keeping most of my assets, and all invested assets, in the US. If you don't have US citizenship, or you are willing to give up your US citizenship, your tax situation would be much different.

Generally, in this kind of situation, you end up having to report your income to both countries, BUT, you generally don't get double taxed. If you get taxed in Canada for that income, you'll be able to write it off the Canadian taxes you've paid on your US taxes, because Canadian taxes are generally much higher. One exception to this that this significantly complicates Canadian tax advantaged accounts. While I don't think you need a financial advisor, I think talking to someone regarding tax implications might make sense.

I kept my investments in the US because taxes are generally lower, so I saw so reason to mess around with trying to move all my assets to Canada. I prefer investing in the US economy anyways, so I saw no reason to explicitly buy Canadian versions of the S&P500 when I was already invested in it. You can certainly balance your portfolio across both countries, you'd just need to do some currency conversion in your calculations.

Also, US brokerages are far more competitive in terms of fees and customer service; the Canadian division of Fidelity is NOT completely identical to the US version. You are probably used to no fees and excellent customer service, don't take that for granted in Canada.
What about bonds? Do u keep bonds in the US too. I don't think Munis would work as they would be taxed normally in Canada
newyorker
Posts: 158
Joined: Sun May 17, 2020 7:59 am

Re: Moving from US to Canada [permanently]

Post by newyorker »

Whats your status in US? Vancouver is a beautiful city.
Topic Author
JD13
Posts: 79
Joined: Thu Nov 01, 2018 8:12 pm

Re: Moving from US to Canada [permanently]

Post by JD13 »

newyorker wrote: Fri Sep 11, 2020 9:29 pm Whats your status in US? Vancouver is a beautiful city.
Here on work visa which is expiring
newyorker
Posts: 158
Joined: Sun May 17, 2020 7:59 am

Re: Moving from US to Canada [permanently]

Post by newyorker »

JD13 wrote: Fri Sep 11, 2020 9:38 pm
newyorker wrote: Fri Sep 11, 2020 9:29 pm Whats your status in US? Vancouver is a beautiful city.
Here on work visa which is expiring

Got it. If so I think taking a shot at Canada is a great choice, especially in Vancouver with great diversity. Good luck!
wanderer
Posts: 197
Joined: Sat Aug 16, 2014 4:09 pm
Location: Houston, Texas, USA

Re: Moving from US to Canada [permanently]

Post by wanderer »

If you haven't seen it, you might look at the BH Canada page: https://www.bogleheads.org/wiki/Category:Canada.

There is a Canadian version of BHs also. I think it is: https://www.financialwisdomforum.org/. You might introduce yourself there too.

Best of successes. We love visiting Vancouver!
Topic Author
JD13
Posts: 79
Joined: Thu Nov 01, 2018 8:12 pm

Re: Moving from US to Canada [permanently]

Post by JD13 »

wanderer wrote: Fri Sep 11, 2020 10:02 pm If you haven't seen it, you might look at the BH Canada page: https://www.bogleheads.org/wiki/Category:Canada.

There is a Canadian version of BHs also. I think it is: https://www.financialwisdomforum.org/. You might introduce yourself there too.

Best of successes. We love visiting Vancouver!
Thankyou
Lyrrad
Posts: 130
Joined: Sun Jul 27, 2008 10:59 am

Re: Moving from US to Canada [permanently]

Post by Lyrrad »

JD13 wrote: Fri Sep 11, 2020 9:00 pm I don't have a US citizenship. I have Indian citizenship
There's some provisions in the US-Canada tax treaty that may be relevant, and you may get better and more detailed responses at the FWF.
  • If you make an election to the CRA in time, you maybe able to get equivalent tax treatment on Roth IRA/401k accounts. I think the deadline is the tax deadline the year after one moves.
  • Pre-tax 401k accounts could also be treated the same. Note that if you're working for the same company in Canada as the US, you may not be able to withdraw/roll over elective / employer contributions while still working at the company, even in another country.
  • If you're not subject to US Exit tax, your taxable investments may not be subject to capital gains by the US after ceasing to become a tax resident. Also Canada may calculate the adjusted cost base (equivalent of "cost basis" in the US) as the value of these investments as of the day one became a Canadian resident. This may mean that it's best to sell taxable positions that are at a loss before moving to Canada, and to wait for the cost base to be reset on positions with gains if one wants to sell those positions.
  • Investments are generally more expensive in Canada. There are accounts like TFSA (Similar to a Roth), and RRSP (similar to pre-tax 401k) that could be used for retirement savings. I think the FWF would be helpful in navigating you through this and provide suggestions on what to use.
  • I'd check what US institutions would let you keep trading in your US accounts after moving, though you may want to rebalance just in your Canadian accounts, or sell your taxable investments in the US and move the funds to a Canadian to invest. One might be able to transfer them in kind to a Canadian brokerage.
  • There's a Totalization agreement between the US and Canada for social security, so you may be able to receive a partial social security benefit from the US, even if you haven't earned 40 quarters in the US.
Topic Author
JD13
Posts: 79
Joined: Thu Nov 01, 2018 8:12 pm

Re: Moving from US to Canada [permanently]

Post by JD13 »

Lyrrad wrote: Fri Sep 11, 2020 11:18 pm
JD13 wrote: Fri Sep 11, 2020 9:00 pm I don't have a US citizenship. I have Indian citizenship
There's some provisions in the US-Canada tax treaty that may be relevant, and you may get better and more detailed responses at the FWF.
  • If you make an election to the CRA in time, you maybe able to get equivalent tax treatment on Roth IRA/401k accounts. I think the deadline is the tax deadline the year after one moves.
  • Pre-tax 401k accounts could also be treated the same. Note that if you're working for the same company in Canada as the US, you may not be able to withdraw/roll over elective / employer contributions while still working at the company, even in another country.
  • If you're not subject to US Exit tax, your taxable investments may not be subject to capital gains by the US after ceasing to become a tax resident. Also Canada may calculate the adjusted cost base (equivalent of "cost basis" in the US) as the value of these investments as of the day one became a Canadian resident. This may mean that it's best to sell taxable positions that are at a loss before moving to Canada, and to wait for the cost base to be reset on positions with gains if one wants to sell those positions.
  • Investments are generally more expensive in Canada. There are accounts like TFSA (Similar to a Roth), and RRSP (similar to pre-tax 401k) that could be used for retirement savings. I think the FWF would be helpful in navigating you through this and provide suggestions on what to use.
  • I'd check what US institutions would let you keep trading in your US accounts after moving, though you may want to rebalance just in your Canadian accounts, or sell your taxable investments in the US and move the funds to a Canadian to invest. One might be able to transfer them in kind to a Canadian brokerage.
  • There's a Totalization agreement between the US and Canada for social security, so you may be able to receive a partial social security benefit from the US, even if you haven't earned 40 quarters in the US.
Those are some really good points @lyrrad
Uncle Morris
Posts: 1
Joined: Sun Jul 12, 2020 8:13 pm

Re: Moving from US to Canada [permanently]

Post by Uncle Morris »

Lyrrad wrote: Fri Sep 11, 2020 11:18 pm
  • I'd check what US institutions would let you keep trading in your US accounts after moving, though you may want to rebalance just in your Canadian accounts, or sell your taxable investments in the US and move the funds to a Canadian to invest. One might be able to transfer them in kind to a Canadian brokerage.
In my experience as a US citizen moving to Canada, Fidelity allowed me to maintain my retirement accounts, but not make any additions to or trades in my taxable account.

(Yes, this is my first post. So much knowledge on this forum that it took months of lurking for me to find something small I could contribute with!)
Valuethinker
Posts: 40968
Joined: Fri May 11, 2007 11:07 am

Re: Moving from US to Canada [permanently]

Post by Valuethinker »

newyorker wrote: Fri Sep 11, 2020 9:45 pm
JD13 wrote: Fri Sep 11, 2020 9:38 pm
newyorker wrote: Fri Sep 11, 2020 9:29 pm Whats your status in US? Vancouver is a beautiful city.
Here on work visa which is expiring

Got it. If so I think taking a shot at Canada is a great choice, especially in Vancouver with great diversity. Good luck!
People wind up moving to Calgary (when the oil price is high) because housing prices are lower and taxes are much lower (by Canadian standards). AFAIK Alberta still has no HST sales tax. But you get to enjoy their winter ("it's a nice dry cold" as they say about Alberta).

Or they move to the Greater Toronto Area, which has the diversity of Vancouver but the urban sprawl & traffic that befits what is now the (4th? 5th?) largest urban area by population in North America (apparently it has just passed Chicago; but the boundaries of these things are always arbitrary). Toronto is where the career opportunities often are (see above). Housing prices are probably lower than Vancouver (city itself, in any case).

Vancouver is a tough choice - super high housing costs + career limitations vs great people, climate (for Canada), lifestyle (although I wouldn't want to schlep in from Surrey every day). The career pull of Hollywood, the Bay Area or Seattle remains very strong. You also have to not mind rain-- the clouds can roll in in October, and not roll out to late February.

Canada is generally a good place to raise a family. Relatively safe & tolerant (if you are not a citizen of the First Peoples). Universal healthcare. University tuition is low compared to most USA or all UK.

Canada is having a good Covid-19 war (relative to USA or UK death rates; as long as you weren't in a retirement home) and it may be that working from home is so entrenched now that it's possible to reside in one of the cheaper parts of British Columbia, such as Vancouver Island. Let's hope so. I have been calling for a Crash in Toronto & Vancouver housing prices for at least 5 years (more like 10) and I have been wrong so far (although prices are down). That statistic that Toronto had more condominium units under construction than any other North American city ...

As to the original question, I recommend the poster post on the Canadian Forum, which is linked into from this Board (go up a level and check the Board names). Cross border moves are common, and both CCRA & IRS have tricks & traps for the unwary.
User avatar
LadyGeek
Site Admin
Posts: 65795
Joined: Sat Dec 20, 2008 5:34 pm
Location: Philadelphia
Contact:

Re: Moving from US to Canada [permanently] [India ex-pat in US]

Post by LadyGeek »

This thread is now in the Non-US Investing forum. I retitled the thread to clarify the OP's status.

The Canadian forum thread is here: Moving from US to Canada [permanently]
JD13 wrote: Fri Sep 11, 2020 8:20 pm Note: I added this post in the Canadian version of the BH forum. If the same folks would see it please let me know and I'll delete this post
Please keep the post, as it's instructive to see both threads. You'll also get answers from both forums.

Disclaimer: I'm a member both forums.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.
newyorker
Posts: 158
Joined: Sun May 17, 2020 7:59 am

Re: Moving from US to Canada [permanently]

Post by newyorker »

Valuethinker wrote: Tue Sep 15, 2020 3:43 am
newyorker wrote: Fri Sep 11, 2020 9:45 pm
JD13 wrote: Fri Sep 11, 2020 9:38 pm
newyorker wrote: Fri Sep 11, 2020 9:29 pm Whats your status in US? Vancouver is a beautiful city.
Here on work visa which is expiring

Got it. If so I think taking a shot at Canada is a great choice, especially in Vancouver with great diversity. Good luck!
People wind up moving to Calgary (when the oil price is high) because housing prices are lower and taxes are much lower (by Canadian standards). AFAIK Alberta still has no HST sales tax. But you get to enjoy their winter ("it's a nice dry cold" as they say about Alberta).

Or they move to the Greater Toronto Area, which has the diversity of Vancouver but the urban sprawl & traffic that befits what is now the (4th? 5th?) largest urban area by population in North America (apparently it has just passed Chicago; but the boundaries of these things are always arbitrary). Toronto is where the career opportunities often are (see above). Housing prices are probably lower than Vancouver (city itself, in any case).

Vancouver is a tough choice - super high housing costs + career limitations vs great people, climate (for Canada), lifestyle (although I wouldn't want to schlep in from Surrey every day). The career pull of Hollywood, the Bay Area or Seattle remains very strong. You also have to not mind rain-- the clouds can roll in in October, and not roll out to late February.

Canada is generally a good place to raise a family. Relatively safe & tolerant (if you are not a citizen of the First Peoples). Universal healthcare. University tuition is low compared to most USA or all UK.

Canada is having a good Covid-19 war (relative to USA or UK death rates; as long as you weren't in a retirement home) and it may be that working from home is so entrenched now that it's possible to reside in one of the cheaper parts of British Columbia, such as Vancouver Island. Let's hope so. I have been calling for a Crash in Toronto & Vancouver housing prices for at least 5 years (more like 10) and I have been wrong so far (although prices are down). That statistic that Toronto had more condominium units under construction than any other North American city ...

As to the original question, I recommend the poster post on the Canadian Forum, which is linked into from this Board (go up a level and check the Board names). Cross border moves are common, and both CCRA & IRS have tricks & traps for the unwary.


Vancouver is probably the best bet out of Vancouver Calgary Toronto Montreal.

Vancouver is disadvantaged by high house prices and lack of career opportunities. But lifestyle is best.


Calgary... cheaper to live but thats about it. Been there done that. Winter is brutal.


Toronto. Just an inferior version of nyc. Wouldnt bother.


Montreal. No comment. Just yuck! Winter is brutal and inferior version of toronto.


Pm. I live at least a year in Calgary and Montreal. Vancouver 7 years (hence my favor for it). Been to toronto multiple times.
Valuethinker
Posts: 40968
Joined: Fri May 11, 2007 11:07 am

Re: Moving from US to Canada [permanently]

Post by Valuethinker »

newyorker wrote: Tue Sep 15, 2020 8:56 pm
Valuethinker wrote: Tue Sep 15, 2020 3:43 am
newyorker wrote: Fri Sep 11, 2020 9:45 pm
JD13 wrote: Fri Sep 11, 2020 9:38 pm
newyorker wrote: Fri Sep 11, 2020 9:29 pm Whats your status in US? Vancouver is a beautiful city.
Here on work visa which is expiring

Got it. If so I think taking a shot at Canada is a great choice, especially in Vancouver with great diversity. Good luck!
People wind up moving to Calgary (when the oil price is high) because housing prices are lower and taxes are much lower (by Canadian standards). AFAIK Alberta still has no HST sales tax. But you get to enjoy their winter ("it's a nice dry cold" as they say about Alberta).

Or they move to the Greater Toronto Area, which has the diversity of Vancouver but the urban sprawl & traffic that befits what is now the (4th? 5th?) largest urban area by population in North America (apparently it has just passed Chicago; but the boundaries of these things are always arbitrary). Toronto is where the career opportunities often are (see above). Housing prices are probably lower than Vancouver (city itself, in any case).

Vancouver is a tough choice - super high housing costs + career limitations vs great people, climate (for Canada), lifestyle (although I wouldn't want to schlep in from Surrey every day). The career pull of Hollywood, the Bay Area or Seattle remains very strong. You also have to not mind rain-- the clouds can roll in in October, and not roll out to late February.

Canada is generally a good place to raise a family. Relatively safe & tolerant (if you are not a citizen of the First Peoples). Universal healthcare. University tuition is low compared to most USA or all UK.

Canada is having a good Covid-19 war (relative to USA or UK death rates; as long as you weren't in a retirement home) and it may be that working from home is so entrenched now that it's possible to reside in one of the cheaper parts of British Columbia, such as Vancouver Island. Let's hope so. I have been calling for a Crash in Toronto & Vancouver housing prices for at least 5 years (more like 10) and I have been wrong so far (although prices are down). That statistic that Toronto had more condominium units under construction than any other North American city ...

As to the original question, I recommend the poster post on the Canadian Forum, which is linked into from this Board (go up a level and check the Board names). Cross border moves are common, and both CCRA & IRS have tricks & traps for the unwary.


Vancouver is probably the best bet out of Vancouver Calgary Toronto Montreal.

Vancouver is disadvantaged by high house prices and lack of career opportunities. But lifestyle is best.


Calgary... cheaper to live but thats about it. Been there done that. Winter is brutal.


Toronto. Just an inferior version of nyc. Wouldnt bother.


Montreal. No comment. Just yuck! Winter is brutal and inferior version of toronto.


Pm. I live at least a year in Calgary and Montreal. Vancouver 7 years (hence my favor for it). Been to toronto multiple times.
That's a little unkind to Toronto ;-)

It's a good place. I lived half my life there. A New Yorker might find it dull but I am old enough to remember when New York was truly unsafe. Toronto has plenty of charm.

Vancouver is kind of depressing w the rain. Nice people, though.

Montreal has a special character raising from its bilingual multi ethnic nature. But since the Separatists swept to power in 1976 it has struggled economically. Very corrupt city government does not help.
Post Reply