Cross Border Financial Planning: Plan Ahead to Stay Ahead

Expatriates often underestimate how complicated planning their cross-border move can be.  We often find that there are several simple steps that if taken before a move, can simplify your financial affairsi mmensely. Here’s a partial list of common US Canada cross-border issues we come across.

  1. Prepare a plan that sets out a strategy for moving across the border. How long do you plan to move? Will you return? Will you require investments in both Canada and the U.S? Will you need to maximize CPP/QPP or Social Security? What about your estate? Do you want retirement income in Canadian or US dollars?
  2. Maintain accurate records and receipts. Document and retain transactions statements, especially of capital transactions. This includes real estate, registered investments and cash accounts. Document the purchase price, currency rate, and market values at the time of the transaction.
  3. Re-arrange your investments and investment accounts prior to moving or very shortly afterwards. Proper restructuring of your accounts can be beneficial not only for future tax planning, but also for streamlining the tax slips. For instance, dividends are taxed differently and afforded different advantages in Canada and the US. Certain types of accounts automatically suppress these types of tax slips and need to be tracked manually.
  4. Estate Planning:  If one spouse is a US citizen, it may not be best to hold assets in joint name or tenants in common. Much depends on the State you live in and whether the estate of the Canadian spouse exceeds the value of the US estate. For combined Canadian and US estates exceeding $3.5 million, it might be worthwhile to incorporate the use of trusts.
  5. Currencies also present a challenge. If assets are denominated in the home currency but the actual need for “cash” is required in the host country, unless a cash management strategy is employed, unnecessary costs and fees can result. In addition, rising ($CAD) currency values can sometimes create tax problems by over inflating the real cost of a ($USD) investment, and thereby giving the appearance of a larger gain for tax purposes.
  6. Treasury Department disclosure: US citizens and non-residents must file a Treasury Department disclosure form showing any foreign accounts with a balance exceeding $10,000.

If you haven’t had a chance to address these issues, it’s still “better late than never.” Consider contacting a qualified professional to help simplify the process — it may save you a lot of time and money in the future.

Paul is a cross-border financial planner and portfolio manager with Pacifica Partners Inc. Capital Management. He can be reached at


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