This applies to Canadian residents only. I have no idea what the strategy would be like if I were to move in from another country…
I haven’t checked the latest updates in the Canadian income tax model, so my information might be outdated, but the below information was definitely true and beneficial for me when I moved from Quebec to BC almost 2 years ago now.
Here’s a simple way to make or save some money moving from one province to another:
There are 2 scenarios:
- Your current province’s income tax rate is higher than BC’s
- Your current province’s income tax rate is lower than BC’s
Since your income tax rate is based on where you reside on December 31st of a given year, it might be profitable for you to move to BC late in the year if you fit scenario #1 or early in the year if you fit scenario #2. Conversely, plan accordingly when deciding to move out of BC to another province. See the current income tax rates here.
Income tax handling has always seemed overly complicated to me and this article is quite basic. I suggest you verify this information for yourself and make sure this holds true for your particular case too.
I hope things work out as well for you as they did for me. ;)