Calgary to Austin: The Energy-to-Tech Pivot and Zero State Income Tax

Calgary produces engineers, data scientists, and project managers; Austin's technology employers hire them. The move trades Alberta's combined top rate of about 48% for a federal-only 37%, with no Texas income tax at any level. The Alberta side carries the departure tax and the corporate wind-up; the Austin side carries property tax and a sales tax that is higher than Calgary's.

Key takeaways

• Alberta's roughly 48% top rate sets the departure tax. On a $300,000 unrealized gain, about $72,000.
• Texas has no state income tax; US tax is federal only.
• Alberta's 5% GST becomes 8.25% sales tax in Austin.
• Travis County property tax runs about 1.8% to 2% effective; file the homestead application after you move in.
• AHCIP ends on permanent departure.

The Alberta departure

Departure tax applies to non-registered investments, private company shares, crypto, and foreign property at fair market value on the departure date. Alberta real estate, RRSPs, TFSAs, and pensions are excluded. Report on Form T1243, list holdings on Form T1161 if the total exceeds $25,000, and post security under Form T1244 for illiquid assets. A Calgary professional or consulting corporation is deemed sold, loses CCPC status, and becomes a US controlled foreign corporation; wind it up before you go.

Austin's side

No income tax; property tax in Travis and Williamson Counties around 1.8% to 2% effective, with a homestead exemption on school district taxable value and a 10% annual appraisal cap; 8.25% sales tax; no estate tax; strong homestead creditor protection.

The RRSP in Texas

Untouched on departure, federally deferred under the treaty, with no Texas layer. Withdrawals face 25% Canadian withholding on lump sums, 15% on periodic RRIF payments within the treaty limit, with a US foreign tax credit.

Equity

Austin tech compensation is equity-heavy. RSUs vesting after the move are split by working days between Canada and the US; no Texas layer. Options exercised after departure are sourced the same way.

Who makes this move

Calgary software engineers and data scientists to Austin's tech employers and startups, Alberta energy analysts to Austin's clean-energy and semiconductor firms, and Calgary project managers to the manufacturing and construction boom around the city.

Worked example

A Calgary data engineer moves to Austin on May 31 with $180,000 of unrealized gain in a non-registered account, $400,000 in an RRSP, RSUs vesting after the move, and a Calgary home sold in the departure year.

• Departure tax. $180,000 gain, $90,000 taxable, at about 48%: roughly $43,000.
• Home. Sold as a resident under the principal residence exemption.
• RSUs. Vests split by working days; no Texas layer.
• RRSP. No tax on departure; periodic withdrawals later at 15%.
• Austin. No state income tax. GST 5% becomes sales tax 8.25%. Property tax on a $650,000 home around $11,000 to $13,000 before homestead.

Official sources

"When you leave Canada, you are considered to have sold certain types of property (even if you have not sold them) at their fair market value (FMV) and to have immediately reacquired them for the same amount. This is called a deemed disposition and you may have to report a capital gain (also known as departure tax)." — Canada Revenue Agency, Leaving Canada (emigrants), https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/individuals-leaving-entering-canada-non-residents/leaving-canada-emigrants.html

"Texas imposes a 6.25 percent state sales and use tax on all retail sales, leases and rentals of most goods, as well as taxable services. Local taxing jurisdictions (cities, counties, special purpose districts and transit authorities) can also impose up to 2 percent sales and use tax for a maximum combined rate of 8.25 percent." — Texas Comptroller of Public Accounts, Sales and Use Tax, https://comptroller.texas.gov/taxes/sales/

Alberta's top personal income tax bracket: "15%" on "$362,961.01 and up" (2025). — Government of Alberta, Personal income tax, https://www.alberta.ca/personal-income-tax

Practitioner note

Calgary-to-Austin files are the ones where the client most often has a consulting corporation from years of contract engineering work. It has to be dealt with before departure. After the move it is a controlled foreign corporation with annual Form 5471 filings and no tax-free capital dividend account.

See also: Weighing Florida instead? See the Canada-to-Florida guide, or the same city's Calgary to Miami guide.

Next step

Fairlight prepares the Alberta departure return, the corporate wind-up, and the first-year US return for Austin clients. See cross-border pricing or book a call.