Canada–Germany Tax Advisor — Canadian Expat Cross-Border Taxes | TWO.TAX

TWO.TAX is the international brand of TWOTAX GROUP. The group includes Steuerbee & Partner, TwoTax LLC, TwoTax Ltd. and its Canadian affiliated company. It provides cross-border tax consulting for people and businesses whose affairs involve Germany and another jurisdiction.

The responsible entity, office, jurisdictions and deliverables are identified for every engagement.

For a scoped review, use the contact page and include the jurisdictions, tax years, deadlines, relevant correspondence and requested deliverable.

Who needs this?

Canadians in Germany may need to consider T1, T1135, TFSA, RRSP, CPP/OAS, departure-tax and treaty questions. TWO.TAX provides English-speaking review for defined cross-border matters.

Key Canada–Germany cross-border tax issues

• TFSA — fully taxable in Germany — Canada's Tax-Free Savings Account has no treaty protection in Germany. All income and gains inside a TFSA — interest, dividends, capital gains — are taxable German income in the year they arise. Many Canadians only discover this at their first German Einkommensteuer assessment, sometimes with multi-year backdated exposure. TWO.TAX calculates the liability and structures future reporting.
• RRSP in Germany — Registered Retirement Savings Plans are generally not recognised as pension funds under the Canada-Germany convention. Annual accruals inside an RRSP may be taxable in Germany unless a treaty deferral election is properly structured. TWO.TAX analyses the situation and advises whether to withdraw before becoming German-resident or seek deferral treatment.
• T1135 foreign-property reporting: whether T1135 applies depends on Canadian residence, property type, value and current rules.
• CPP and OAS pensions in Germany: treaty treatment and withholding may depend on the facts and current rules.
• Departure tax: Canadian departure tax can apply when tax residence ends, depending on the assets and circumstances.
• Provincial health coverage and residency ties — Cutting Canadian residential ties (OHIP/MSP cards, bank accounts, property) is required to stop Canadian tax residency. Incomplete tie-cutting leads to continued T1 and T1135 obligations. TWO.TAX advises on the checklist before clients leave.

Canada–Germany tax FAQ

• Do I still have to file a Canadian tax return while living in Germany? — If you have properly cut all residential ties to Canada, no — you file a final departure T1 and then stop, unless you have Canadian rental income, dividends, or pensions subject to NR withholding.
• Is my TFSA tax-free in Germany? — No. Germany taxes all gains and income inside a TFSA as regular investment income (Kapitalertragsteuer 25%). This surprises nearly every Canadian who moves here.
• What is departure tax and do I have to pay it? — Departure tax is the deemed disposition of your assets when you leave Canada. It is unavoidable for most assets, but the amount can be minimised with pre-departure planning.

For a scoped review, contact TWO.TAX with the countries, tax years, deadlines and requested deliverable.