Moving to the UK from Canada: The 2026 Tax Guide

Answer first: yes, potentially, but often not on your Canadian income and gains for the first four years. Once you are UK tax resident, the UK's default (the arising basis) taxes your worldwide income and gains as they arise, wherever in the world they come from. That includes Canadian employment income, rental income, dividends, interest and capital gains.

The important exception for most people arriving from Canada is the 4-year FIG regime (covered below). If you qualify, you can claim relief so that your Canadian and other foreign income and gains are effectively free of UK tax for up to four tax years. Your UK-source income (for example, a UK salary once you start work here) is always taxable in the UK from day one, regardless of FIG.

Two systems run in parallel while you settle. The SRT decides whether and when you become UK resident, and the FIG regime decides how your foreign income and gains are taxed in your early years. The Canada-UK double tax treaty then sits over the top to stop the same income being fully taxed twice.

Your UK tax residence is not a choice; it is decided mechanically by the Statutory Residence Test. The UK tax year runs 6 April to 5 April. You are automatically UK resident for a tax year if any one of the automatic UK tests is met. The clearest is the day-count test:

• 183 days or more in the UK in a tax year makes you automatically UK resident, with no exceptions. You are generally counted as spending a day in the UK if you are here at midnight.
• The home test: broadly, if you have a UK home for at least 91 consecutive days (30 of them in the tax year) and have no overseas home you use enough, you can be resident on far fewer days.
• The full-time work test: working full-time in the UK over a 365-day period can also make you resident.

If none of the automatic UK tests (and none of the automatic overseas tests) apply, residence is decided by the sufficient ties test, which weighs your UK connections (family, accommodation, work and 90-day history) against your day count. When you arrive part-way through a UK tax year, split-year treatment can often split the year into a non-resident part and a resident part, so you are only taxed as a UK resident from your arrival. For the SRT mechanics and a first read on your day count, see our moving-to-the-uk-tax-guide and try the srt-calculator.

The 4-year FIG regime replaced the old non-dom remittance basis on 6 April 2025. For a Canadian arriving now, it is the single most valuable relief. If you qualify, you can claim 100% relief from UK tax on your qualifying foreign income and gains for your first four tax years of UK residence.

You qualify if you become UK tax resident after at least 10 consecutive tax years of being non-UK resident. If you have never lived in the UK, or left more than 10 years ago, you will normally meet this. The four years run consecutively from the first year you become UK resident, and split years and years of treaty non-residence still count as UK-resident years, so the clock keeps ticking whether or not you claim.

Important conditions to plan around:

• You must claim FIG for each source of income or gain, in each tax year, on your Self Assessment return. It is not automatic.
• In any year you claim, you lose your income tax personal allowance and your capital gains tax annual exempt amount, so it is worth modelling whether a claim actually helps in a low-foreign-income year.
• Relief applies to foreign income and gains arising on or after 6 April 2025; it does not rescue pre-April-2025 foreign income.
• Most foreign pension income is within the regime, which matters directly for RRSP and RRIF withdrawals (see below).

For a deeper walkthrough of eligibility and claims, see fig-regime-uk and use the fig-checker to see whether you are likely to qualify.

This is where Canada-UK planning gets specific, and where mistakes are common. Treat your Canadian registered accounts individually, because the UK does not respect them all the same way.

RRSPs and RRIFs. These are generally respected as pensions under the Canada-UK double tax treaty, so the fund itself is not taxed on its internal growth while it stays wrapped. When you take money out as a UK resident, though, the withdrawal is generally UK-taxable. Canada usually applies withholding tax at source: broadly 25% on lump-sum RRSP or RRIF withdrawals, and 15% on periodic pension payments from a RRIF. The treaty makes periodic pension payments taxable only in the UK as your country of residence, so the Canadian tax on periodic payments can generally be reclaimed or refunded, whereas the credit position on lump sums works differently. Because how UK tax and treaty relief interact depends on whether you take periodic payments or a lump sum, and on getting the forms right, the sequencing of any withdrawal deserves advice (the exact Canadian withholding and refund mechanics are to confirm for your plan). During your FIG window, a claim can shelter these foreign pension withdrawals from UK tax, which can make the first four years an efficient time to draw down, if the Canadian side works too.

TFSAs. Do not assume your Tax-Free Savings Account is tax-free in the UK. It is not. The UK does not recognise the TFSA wrapper, so once you are UK resident the interest, dividends and capital gains inside it can be UK-taxable like any ordinary investment account. FIG relief may cover this while you can claim it, but after your four years, a TFSA becomes a fully taxable holding from the UK's point of view. On the Canadian side, you can keep a TFSA as a non-resident but you cannot make new contributions without a penalty, so many people review or restructure a TFSA before or during their move.

Leaving Canada is a Canadian tax event in its own right, separate from anything the UK does. When you cease to be a Canadian tax resident, the Canada Revenue Agency generally treats you as having sold most of your capital property at fair market value on your departure date and immediately reacquired it. This deemed disposition can crystallise capital gains and produce departure tax, even though you have not actually sold anything.

What is generally caught: shares, ETFs, mutual funds, cryptocurrency and foreign real property. What is generally excluded: Canadian real property (taxed later when actually sold), RRSPs, RRIFs and other registered plans such as TFSAs, RESPs and RDSPs (which keep their Canadian status, with withdrawals taxed later), and CPP/QPP and registered pension entitlements. You may be able to elect to defer paying the departure tax until you actually sell, and there are Canadian filing forms to complete (Form T1243 for the deemed disposition and, where the total value of your property on departure exceeds CAD 25,000, Form T1161).

Keeping Canadian property or investments is perfectly possible, but plan the interaction with the UK. Canadian rental income becomes UK-taxable once you are UK resident (with treaty relief for Canadian tax paid), and a later sale can face both Canadian rules and UK capital gains tax, again with the FIG window potentially relevant. The key point: the Canadian and UK timelines rarely line up neatly, so model both before you set a departure date.

The best Canada-UK tax outcomes are almost always set up before you become UK resident. Once the SRT clock has ticked over, many options close. Practical areas to review with an adviser:

• Time your arrival. Because split-year treatment and the FIG four-year clock both hinge on when you become resident, the calendar date you land can change your tax bill. Understand your day count before you commit.
• Review your TFSA. Decide whether to keep, rebalance or unwind it before UK residence, given it loses its tax-free status here.
• Consider crystallising Canadian gains. Realising gains while still Canadian resident (or dovetailing with departure tax) can reset your cost base and reduce future UK CGT, but only when the numbers support it.
• Plan RRSP and RRIF drawdowns. The FIG window can be an efficient time to take pension income, but the Canadian withholding and treaty position must be worked through first.
• Keep clean records. Note the value of every asset on your departure and arrival dates; you will need them for both countries.

Finally, think about Inheritance Tax early. From 6 April 2025 the UK runs a residence-based IHT system. You come into UK IHT on your worldwide estate once you have been UK resident for at least 10 of the last 20 tax years (a 'long-term resident'), and a tail of between 3 and 10 years can keep you in scope after you leave. The nil-rate band is £325,000 (frozen to April 2030) and the residence nil-rate band is £175,000, tapering away by £1 for every £2 of estate over £2,000,000; the rate is 40% (36% where 10% or more of the estate goes to charity). Both bands transfer between spouses and civil partners, so a couple can potentially pass on up to £1m free of IHT. IHT is due six months after the end of the month of death, with a 10-year instalment option for property. For the residence rules that will eventually apply to you, see residence-based-iht.