If I move to Ontario mid-year, do I pay Ontario tax for the whole year?
No — Ontario provincial tax applies only for the period you were resident in Ontario. Canada's income tax rules use your province of residence on December 31 of the tax year to determine which province's tax you pay for the entire year at the provincial level, with a notable exception: if you moved from another province, you generally pay provincial tax based on where you lived on December 31.
However, if you moved to Ontario from another province during the year, you technically pay Ontario tax for the full year based on your December 31 residence, not just the months you spent there. The other province's tax does not apply once you are an Ontario resident at year-end. This means moving to a lower-tax province before December 31 could reduce your provincial tax for that year, and moving to a higher-tax province before December 31 means the higher rate applies for the full year.
Foreign income earned before arriving in Canada as a new resident is generally not taxable in Canada for that period (you report as a part-year resident). If you immigrated to Canada mid-year, the rules are different — your Canadian residency start date limits what income is taxable here. A tax professional is strongly recommended in the year of a cross-border or interprovincial move.
Key takeaways
- Your province of residence on December 31 determines which province's tax applies for the full year.
- Moving to Ontario before year-end means Ontario tax applies for the whole year.
- New immigrants are taxed as part-year residents on Canadian-source income.
- The year of a move almost always warrants professional tax advice.