Property You Owned Before Moving to Canada
Property owned before you immigrate gets a new cost base at market value on arrival. What qualifies, what to document, selling later, and T1135.
The short version
- When you become a Canadian resident, most of what you own is treated as bought at its market value on that day. Canada only taxes growth after you arrived.
- That fresh cost base applies to foreign real estate, foreign and most Canadian shares, and crypto. It does not apply to Canadian real estate or a Canadian business you already owned.
- Get proof of the value on your arrival date now: an appraisal, a broker statement, a sale listing of similar homes. In ten years nobody will remember.
- Selling later, you pay Canadian tax on the gain since arrival, in Canadian dollars, with a foreign tax credit for tax the other country takes.
- Foreign property costing more than $100,000 in total, using the arrival values, goes on form T1135 every year from the year after you arrive.
Property You Owned Before Moving to Canada
Canada is polite about your past. It doesn't tax the growth on your apartment in Manila or your shares in London from before you lived here. The law does this with a quiet fiction: on the day you become resident, you're treated as having sold most of your things and bought them back at market value. No tax on that pretend sale, and a new starting cost for everything. The catch is that you have to prove what that value was, and the proof is easiest to get the year you arrive.
What Gets a Fresh Cost Base
| Property owned when you arrive | Cost for Canadian tax |
|---|---|
| Foreign home or rental property | Market value on the day you became resident |
| Foreign shares, funds, bonds | Market value on that day |
| Canadian public shares held in a foreign account | Market value on that day (generally) |
| Crypto | Market value on that day |
| Canadian real estate or a business in Canada already owned | No reset. Original cost, because Canada could always tax it. |
| Foreign pension rights and retirement accounts | Special rules; depends on the plan and the treaty |
How cost is tracked afterward: adjusted cost base. Shares in particular: stock taxes; crypto: crypto tax.
Brought property or investments with you?
Tell the assistant what you own abroad, when you arrived and roughly what it was worth then. It explains your Canadian cost, what to document, and what selling would cost in tax on both sides.
Example: An Apartment Abroad, Sold Later
| Canadian dollars | |
|---|---|
| Bought in 2012 | $180,000 |
| Worth on the day you became resident, 2024 | $420,000 (new Canadian cost) |
| Sold in 2027, after selling costs | $470,000 |
| Gain taxed in Canada | $50,000, not $290,000 |
| Half included in income | $25,000 |
If the other country taxes the gain too, that tax is generally a foreign tax credit here; see foreign tax credits. All amounts are converted to Canadian dollars at the rate on each date, so a currency move alone can create a gain or loss. Estimate the Canadian side with the capital gains calculator; for a rental with depreciation, the rental sale calculator.
Your Home Abroad and the Principal Residence Exemption
A home outside Canada can be a principal residence, but only for years you were a Canadian resident and you, your spouse or your children ordinarily lived in it. Once you've moved here, the old family home is usually empty or rented, so it rarely qualifies for later years. The fresh cost base still protects all the growth before you arrived. Rules: principal residence exemption. Renting it out? Report the rent here; see rental income.
What to Do in Your First Year
- List everything you own outside Canada and its value on your arrival date.
- Keep proof: a dated appraisal or comparable sales for real estate, year-end or arrival-date statements for investments, exchange screenshots for crypto.
- Report income only from arrival, not the value of the property; see foreign income after moving.
- Check T1135: if the total cost, at arrival values, is over $100,000, file it from your second Canadian tax year; see form T1135.
- Keep the records for as long as you own the property, plus six years. Your first return: first tax return in Canada.
Leaving again within five years? Property you brought with you is generally exempt from departure tax if you were resident for 60 months or less in the last 10 years; see leaving Canada.
Property Before Moving Questions
Do I pay Canadian tax on gains from before I moved to Canada?
Generally no. When you become a resident, most property is treated as acquired at its fair market value on that date, so only growth after you arrive is taxed in Canada. Canadian real estate and Canadian business property you already owned are the main exceptions.
Do I have to report foreign property when I immigrate to Canada?
Not on the first return, apart from income earned after you arrive. From your second tax year, if the total cost of your specified foreign property is more than $100,000, you file form T1135, using the values on your arrival date as the cost.
How do I prove the value of property on the day I became a resident?
Keep a dated appraisal or comparable sales for real estate, and statements showing the value around your arrival date for investments and crypto. Get these early; they are much harder to reconstruct years later.
Is my home in my old country a principal residence?
Only for years you were a Canadian resident and someone in your family ordinarily lived in it. Years before you arrived don’t need the exemption, because the cost resets to market value on arrival.
What happens if I sell my foreign house after moving to Canada?
You report the gain since your arrival date, converted to Canadian dollars, on your Canadian return. Half is taxable. Tax paid in the other country on the same gain is usually a foreign tax credit.
Sources: Income Tax Act, paragraph 128.1(1)(c) (deemed acquisition on immigration) and section 128.1(4) (short-term residents); CRA, Newcomers to Canada; CRA, Form T1135. Checked October 2026. Foreign pensions and retirement accounts have their own rules and are not covered. The other country's tax on a later sale depends on its law and the treaty. The example ignores currency changes.
Last reviewed October 5, 2026 against CRA and Government of Canada sources. How we check our facts.