Moving back to India from Canada?
Here's what changes for your RRSP, TFSA, brokerage accounts, and tax residency.
ISO Certified
SIPC Insured
SEBI RIATax residency
When do you become an Indian tax resident again?
Your residency status is determined by days spent in India.
Either of these makes you a tax resident
Rule 1
182 days or morein India during one financial year.
Rule 2
60 days or more this yearand365 days or more across the previous 4
Once you're a resident, your global income, including Canadian dividends and capital gains, becomes taxable in India. Your move date relative to the financial year can shift this by a full year.
Transitional status
What is RNOR, and why does it matter?
Between NRI and ordinary Indian resident, there's a transitional status called Resident but Not Ordinarily Resident (RNOR). During this window, your Canadian-sourced income is generally not taxed in India.
You qualify if
- 1You were an NRI for 9 of the previous 10 years, or
- 2You spent fewer than 730 days in India over the previous 7 years.
RNOR window typically lasts
2 – 3 years
Outside Indian tax during RNOR
- ✓Capital gains from selling Canadian stocks
- ✓Withdrawals from your TFSA or RRSP
- ✓Canadian rental income
- ✓Interest from Canadian bank accounts
Crucial Rule: To utilize these exemptions, funds must be received in your Canadian bank account first. Direct wiring to an Indian account makes them taxable.
Filing requirements
Disclosures and filings at each stage
Your filing obligations are limited during RNOR, and ramp up sharply once you become an Ordinary Resident.
| Requirement | NRI | RNOR | Ordinary Resident |
|---|---|---|---|
| Canadian income taxable in India | No | No | Yes |
| Schedule FA (foreign asset disclosure) | No | No | Yes |
| Schedule FSI (foreign source income) | No | No | Yes |
| Form 67 (foreign tax credit claim) | No | No* | Only if claiming foreign tax credit |
| Advance tax on foreign income | No | No | Yes |
| Black Money Act penalties for non-disclosure | No | No | Yes |
* Form 67 may apply to an RNOR in case of foreign income that becomes taxable in India.
The key shift from RNOR to Ordinary Resident: your global income becomes taxable, and you need to disclose all brokerage accounts and holdings, RRSPs, TFSAs, and property to the Indian tax authorities.
Brokerage accounts
What happens to your Canadian brokerage accounts?
When you move back, you become a non-resident in Canada. Most brokerages do not support non-residents and may restrict your account or force you to liquidate.
Option 1: Transfer in-kind (Recommended)
Move your entire eligible portfolio to an India-friendly global broker like Paasa without selling, allowing you to retain your positions.
Option 2: Liquidate your holdings
Sell your positions immediately and manage the cash, triggering Canadian departure tax considerations.
Equity compensation
What happens to your RSUs and stock options?
Tax treatment depends heavily on your equity plan documents and residency status on the vesting date.
1. Vesting during NRI status
Taxed as ordinary Canadian employment income. The CRA withholds tax on the vesting date.
2. Vesting during RNOR
Taxed in Canada only. No Indian tax on vesting, as it is treated as foreign-sourced income.
3. Vesting after becoming ordinary resident
If you continue working for the same company in India, income is apportioned between Canada and India based on workdays, with a foreign tax credit available.
Retirement accounts
What happens to your Canadian retirement accounts?
You can keep your registered Canadian retirement accounts open indefinitely after returning to India. What changes is how they are taxed.
| Account | New Contributions | Canadian Tax | Indian Tax (as Ordinary Resident) |
|---|---|---|---|
| RRSP | Not possible | 25% withholding (or 15% via Form NR301) | Taxable at slab rate; foreign tax credit applies |
| TFSA | Not possible | Tax-free | Fully taxable as ordinary income in the year it arises |
| CPP | Based on employment | 25% withholding | Taxable at slab rate; foreign tax credit applies |
Property
What happens to your Canadian property?
There is no deemed disposition exit tax on Canadian real estate. You can continue to hold and rent it out indefinitely.
Rental income
Canada applies a 25% withholding tax, or you can file an NR6 election to pay tax on net income. India taxes it after you become ROR but provides a foreign tax credit.
Capital gains on sale
Under Article 13 of the DTAA, Canada always retains the right to tax the gain. India also taxes it once you are a full ROR, offering a credit for the Canadian tax paid.
Exit tax
Will you owe a Canadian departure tax when you leave?
Deemed Disposition Tax
Canada treats your non-registered stocks, ETFs, and mutual funds as if they were sold at fair market value the day before you leave, taxing the "paper profits."
RRSPs, TFSAs, & Real Estate
Your registered retirement plans, employer pensions, and Canadian real estate are completely exempt from the departure tax.
FAQ
Common questions returning Canadian NRIs ask
Country guides
Guides for where you're returning from
Each guide breaks down brokerage, retirement, tax, and exit considerations for your origin country.
How Paasa helps
Built for returning Indian professionals
From navigating your RNOR window to generating exact Schedule FA filings, Paasa is the financial home for your transition back to India.
In-kind brokerage transfers
Move eligible accounts from Canadian brokerages via AON/ACATS so you don't book taxable capital gains.
Estate Tax Protection
Direct access to Ireland-domiciled UCITS ETFs, allowing you to legally shield your investments from the 40% US Estate Tax applied to non-residents holding US equities.
Schedule FA and FSI reports
Year-end disclosures generated for every foreign holding, tailored exactly for Indian reporting requirements.
LRS-compliant remittance
Send money abroad under the USD 250,000 annual window to keep compounding your wealth globally.
RNOR-aware strategy
Built around your specific planning window so you can optimize cost-basis resets before the window closes.
You own your assets
Your holdings are held in your name at our global custodian, Interactive Brokers.
SEBI REGISTERED RIA: INA000021058
Enterprise-grade security, certified for sensitive and regulated data
Book a call with a Paasa advisor to map out your Canadian exit (RRSP/TFSA strategies, departure tax, and Schedule FA filings).