What you need to know about inheriting or transferring a foreign pension
In Canada, if you receive an inheritance, whether from a Canadian or foreign estate, it is tax-free. However, there are exceptions. A recent case involved “inheriting an IRA” from his father in the United States. When the taxpayer did not report the IRA payment on his Canadian tax return, the Canada Revenue Agency reassessed him and added it to his income minus the A judge upheld the ruling that the payment was taxable, because the payment didn’t come from his father’s estate and since there is a specific rule in the Canadian Income Tax Act stating that a taxpayer must include any pension benefit in their Canadian income. The taxpayer could have done things different to avoid the tax, but it does get complicated and depends on your unique circumstances.
Read more: What you need to know about inheriting or transferring a foreign pension