Glossary

The words, in plain language

Tax and residency terms you'll see in your report, the guides and the tools. These are general explanations, not tax advice.

90% rule: If at least 90% of your worldwide income for the year comes from Canada while you're a non-resident, you can claim all of Canada's non-refundable tax credits, such as the basic personal amount. Otherwise only some credits are allowed.
183-day rule (sojourner rule): If you spend 183 days or more in Canada in a year without otherwise being a resident, the CRA treats you as a deemed resident for that whole year. Many other countries use a similar 183-day test for their own tax residency.
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Basic personal amount: The amount of income you can earn each year before you pay federal income tax in Canada. Non-residents may only claim it in full if they meet the 90% rule.
Canadian-source income: Income that comes from Canada, such as a Canadian job, rent from a Canadian property, Canadian pensions or RRSP withdrawals. Non-residents generally pay Canadian tax only on this kind of income.
Confidence score: The percentage shown with your residency classification. It reflects how clearly your answers point one way. A low score means your ties are mixed and worth reviewing with a professional.
CPP (Canada Pension Plan): The pension you build by working in Canada. It can be paid to you anywhere in the world, but non-residents may have tax withheld from it.
CRA (Canada Revenue Agency): The federal agency that runs Canada's tax system and decides your tax residency status.
Cross-border tax professional: An accountant or tax lawyer who specializes in people with ties to more than one country. We recommend one for any "Requires Professional Review" result or major move.
Day count: The number of days you've spent in each country in a year. Our tax tracker keeps this tally so you can see how close you are to residency thresholds such as 183 days.
Deemed disposition: When you leave Canada, the CRA treats most of what you own (stocks, crypto, a business) as if you sold it at its market value on the day you left, even though you didn't. Any gain is taxed on your final return. Some things are exempt, such as Canadian real estate, RRSPs and TFSAs.
Deemed non-resident: Someone who would be a Canadian resident, but whom a tax treaty's tie-breaker rules make a resident of another country instead. For Canadian tax purposes they're treated as a non-resident.
Deemed resident: Someone the law treats as a Canadian resident even without strong ties, most often because they spent 183 days or more in Canada in the year. Deemed residents are taxed on their worldwide income.
Departure tax: The tax owed on the gains from the deemed disposition when you leave Canada. You report it on your final Canadian return and can ask to defer paying it by posting security (Form T1244).
Digital nomad: Someone who works remotely while living in, or moving between, other countries.
Digital nomad visa: A visa or permit that lets remote workers live in a country for a set time, usually 6 to 24 months, while working for clients or employers elsewhere. Rules, fees and income minimums differ by country. Living there under one may also make you a tax resident of that country.
Emigrant: The CRA's word for someone who leaves Canada and becomes a non-resident.
Factual resident: Someone who keeps significant residential ties to Canada while living abroad. A factual resident is taxed by Canada on worldwide income, as if they never left.
FBAR and FATCA: U.S. reporting rules for foreign bank accounts and assets. They matter if you're a U.S. citizen or green card holder, even while living in Canada or elsewhere.
Foreign tax credit: A credit that reduces your Canadian tax by the tax you've already paid to another country on the same income, so you aren't taxed twice. Federally it's claimed on Form T2209.
Likely Non-Resident: One of our four residency classifications: your answers suggest you've cut your main ties to Canada. You'd generally be taxed only on Canadian-source income.
Likely Resident: One of our four residency classifications: your answers suggest your main ties are still in Canada, so Canada would tax your worldwide income.
NR4 slip: A slip showing Canadian income paid to a non-resident, such as pensions, RRSP withdrawals or dividends, and the tax withheld from it.
NR6: A form that lets a non-resident landlord have tax withheld from net rental income instead of gross rent. You then file a section 216 return each year.
NR73: An optional form, "Determination of Residency Status (Leaving Canada)", that asks the CRA for its opinion on your residency. It gives certainty but can work against you if your situation is borderline.
OAS (Old Age Security): A federal pension for seniors based on how long you lived in Canada after age 18. To receive it while living abroad you generally need 20 years of Canadian residence after 18.
Part XIII tax (non-resident withholding tax): A flat 25% tax withheld from certain Canadian income paid to non-residents, such as dividends, rent, pensions and RRSP withdrawals. A tax treaty can lower the rate.
Provincial health coverage: Your province's health insurance, such as OHIP in Ontario. Coverage usually ends after a long absence, and keeping it can count as a tie to Canada.
Requires Professional Review: One of our four residency classifications: your ties point both ways, so the answer depends on details a cross-border tax professional should look at.
Residency classification: The result of our questionnaire: Likely Resident, Likely Non-Resident, Deemed Resident or Requires Professional Review. It's an educational estimate, not a ruling from the CRA.
Residential ties: The connections the CRA looks at to decide your tax residency. Significant ties are a home in Canada, a spouse or common-law partner in Canada, and dependants in Canada. Secondary ties include a car, furniture, bank accounts, credit cards, a driver's licence, provincial health coverage and memberships.
Risk flag: A point in your report or dashboard that could cause tax trouble, such as keeping a home available in Canada or nearing 183 days in a country.
RRSP (Registered Retirement Savings Plan): A Canadian retirement savings account. You can keep it after leaving Canada, but withdrawals as a non-resident have tax withheld (25%, or less under some treaties).
Schengen 90/180 rule: Canadians can spend up to 90 days in any 180-day period in the Schengen Area (most of the EU plus a few other countries) without a visa. Days in all Schengen countries count together.
Section 216 return: A separate Canadian return non-residents can file to be taxed on net rental income from Canadian property instead of having 25% withheld from gross rent.
Section 217 election: A choice non-residents can make to have certain Canadian pensions and benefits taxed at regular rates instead of the flat withholding rate, which can mean a refund.
Social security agreement: An agreement between Canada and another country that coordinates pension contributions and benefits, so you don't pay into both systems for the same work and can combine periods of coverage.
Soft life: A lifestyle centred on ease, rest and wellbeing rather than constant hustle. It's a big reason many of our members move abroad.
T1135: The Foreign Income Verification Statement. Canadian residents must file it if the total cost of their foreign property (such as foreign bank accounts or investments) was more than $100,000 at any time in the year.
T1161: A form listing what you own when you leave Canada. It's required if the total value of your property is more than $25,000 (with some exceptions, such as cash).
T1243: The form used to calculate the gains from your deemed disposition when you leave Canada.
Tax residency: The country (or countries) that can tax you on your worldwide income. It's based on tax law, not citizenship or immigration status, so you can be a tax resident of a country without residency papers, or the reverse.
Tax residency certificate: An official letter from a country's tax authority confirming you're a tax resident there. It can be used to claim treaty benefits.
Tax treaty: An agreement between Canada and another country that decides which country taxes which income, so the same income isn't taxed twice. Canada has treaties with more than 90 countries.
Tie-breaker rules: Rules in a tax treaty that decide which single country you're a resident of when both claim you. They look in order at your permanent home, your centre of vital interests (personal and economic ties), where you usually live, and your citizenship.
TFSA (Tax-Free Savings Account): A Canadian savings account with tax-free growth. You can keep it as a non-resident, but any new contribution while non-resident is charged a 1% penalty for each month it stays in the account.
Worldwide income: All your income from every country. Canadian residents report and pay Canadian tax on worldwide income, with credits for tax paid elsewhere.