I plan to move to Germany in the spring to work for my Toronto-based company's German subsidiary in Frankfurt. I plan to live, work and study there for 2-4 years and then come back to Canada. What should I do with my RRSP, TSFA and savings investments while in Germany, to minimize double taxation on interest gains? asked by T., European Sales Manager, Toronto, ON

For Canadian tax purposes, you are deemed to dispose of almost all of your property at its fair market value on the day that you emigrate from Canada. This will include all non-registered investments that you have. You are not, however, deemed to dispose of your registered investments (RRSPs and TFSAs). You can keep any TFSAs that you own and continue to benefit from the exemption from Canadian tax on investment income and withdrawals. However, no contribution will be allowed and no contribution room will accrue while you are a non-resident of Canada. You can also keep any RRSPs that you own. Any withdrawals made from your RRSP when you are a non-resident are subject to a 25% withholding tax in Canada. You should inform your investment company(ies) of the date on which you become a non-resident. Per the Canada / Germany Tax Treaty, as long as you do not own more than 10% of the company that is paying you interest and dividends that are held as a non-registered investment, there are no withholding taxes payable to the Canadian government.

In summary, you will not be subject to any Canadian tax on your Canadian held investments when you are living in Germany, but I cannot say what your German tax situation will be.