Canada Vs. the US: What to Know Before Moving Here

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As both Americans and Canadians experience the impact of Trump 2.0, you might be feeling uneasy about what the future might bring. For many disillusioned Americans, moving from America to Canada is a very real consideration. In fact, according to The Hill, there was a spike of more than 5000% in online searches for “Moving to Canada” and “immigrate to Canada.” We’re flattered!

Here we take a look at Canada vs the U.S. from an immigration and quality of life point of view, to help you understand what immigrating from the U.S. to Canada might look like.

Immigrating from U.S. To Canada: Express Entry

Our immigration rules apply to all countries and are based on a “point system” to determine your eligibility. The qualities that increase your chances of entry also qualify you for “Express Entry” in as soon as five to six months, including:

  • You’re under 30
  • You have advanced degrees
  • You have at least 3 years of work experience
  • You can speak, read, and write English, French or both

Once you’ve lived and worked here for a year, you can earn points for Canadian work experience to help fast track permanent residence.

Do you have more questions about buying a home in Canada? Here are a few more posts that you might find helpful:

Alternative Fast Tracking

There are a few other things that can help make immigrating from the U.S. to Canada more likely, including:

  • A Canadian-based job offer from a Canadian employer
  • One of your parents is a Canadian citizen
  • Your legal partner is a Canadian citizen

Students Moving from America to Canada

A student permit can increase your chances of qualifying for an open work permit once you graduate Unfortunately, being accepted into a post-secondary program in Canada is no longer a guarantee of entry. The government reduced the number of student immigrants granted study permits each year, unless you’re pursuing master’s or doctoral studies.

Border Application

If you have a legitimate full-time Canadian job offer and are eligible for a Canadian work permit, you can also gain entry by applying at a Canadian border. You’ll need the following documents:

  • A copy of your employment contract
  • Either a copy of a labour market impact assessment or an offer of employment number from your employer

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Tax Implications of Moving From America to Canada

Americans still have to file an annual U.S. income tax return while working and living in Canada despite paying Canadian taxes. In other words, you have a double tax obligation.

Luckily, there are some exclusions and tax credits that might help you avoid this double taxation nightmare:

  • U.S. citizens might qualify for a foreign earned income exclusion
  • You can also claim a foreign tax credit against your U.S. tax liability for any Canadian taxes you’ve paid
  • Speak to a tax expert who understands income recognition rules and deductions before you decide to move!

Cost of Living: Canada vs U.S.

The cost of living varies significantly depending on your chosen location in Canada and your previous residence in the United States. Here are some general cost comparisons:

  • Healthcare: Canada has public healthcare while the U.S. is mostly privatized. As a result, you can expect more affordable healthcare but might find access to various services restricted compared to the U.S.
  • Taxes: Taxes are complicated to assess. However, looking at the tax brackets, here’s where you’ll come out:
    • Low-income: Americans pay less tax than Canadians
    • Middle-class: Canadians see better tax cuts than Americans
    • High-income: Canadians tend to pay less tax than Americans
  • Housing: This is another area that’s difficult to compare due to thousands of housing market variations across both countries. Overall, Canada tends to have lower housing costs for renters and higher costs for homeowners. Canada also tends to have lower property taxes which can give homeowners a bit of a break. However, you’d need to compare your current location to where you plan to move in Canada to get a realistic picture. Also, because the U.S. dollar is much stronger than the Canadian “loonie” as we call it, selling your U.S. property will give you a hefty down payment in Canada!
  • General expenses: Things such as food and gas tend to be higher in Canada, but that is balanced out with higher car insurance, utilities and rent in the U.S.

American Home Purchases in Canada

Although Americans can gain from the stronger U.S. dollar when purchasing a home in Canada, Canada passed a foreign buyer ban preventing non-Canadians from buying residential properties in 2022. Originally set to expire in 2024, it was extended to January 1, 2027.

Before buying a home in Toronto, Canada, learn more about the local real estate market with our monthly market updates here.

How does the ban apply?

The ban prohibits non-Canadians from directly or indirectly purchasing residential properties in the following areas:

  • Census metropolitan areas with a total population of at least 100,000, of which 50,000 or more must live in the core
  • Census agglomerations with a core population of at least 10,000

Who is considered a non-Canadian?

Anyone who is not a Canadian citizen, permanent resident, or registered as an Indian under the Indian Act.

What are some exemptions?

There are a few exemptions that apply, including:

  • Temporary residents studying or working in Canada
  • Refugees and refugee claimants
  • Accredited members of foreign missions in Canada
  • Non-Canadian spouses and common-law partners

What happens next?

The Canadian government is monitoring market conditions and will assess the impact of the ban to determine if it should be extended, modified, or terminated.

How can real estate lawyers help?

Real estate lawyers can help you navigate the ban, including identifying exemptions and reviewing property transactions.

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The Bottom Line

Moving from the United States to Canada could provide a comparable lifestyle for Americans at odds with the Trump administration. However, you really need to investigate possible financial challenges such as double taxation, job availability/salaries, local housing costs and the ban on foreign home ownership that could make life in Canada less appealing.

Do you have more questions about moving to Canada from the U.S.? We’d be happy to start a conversation! Give us a call at 416.291.7372 or email us at hello@christinecowern.com.