Moving from the US to New Brunswick: What Changes on Your Taxes, and What Follows You

New Brunswick shares a border with Maine and a labour market with New England. Americans arrive for Fredericton's cybersecurity cluster, Saint John's energy and port employers, Moncton's logistics and back-office sector, and the University of New Brunswick. The tax profile is a high-rate, high-sales-tax province: a 19.5% top provincial bracket for a combined top marginal rate near 52.5%, and a 15% HST.

Key takeaways

• No arrival tax. Property is deemed acquired at fair market value when you become a Canadian resident; US basis is unchanged.
• NB's combined top rate is about 52.5%.
• 15% HST on most purchases.
• NB Medicare coverage generally begins after a waiting period of up to three months. Budget for private coverage.
• The US filings (1040, FBAR, Form 8938, PFIC rules) follow you regardless of province.

Becoming a New Brunswick resident

Residency starts when you establish residential ties. From that date Canada taxes worldwide income, and under section 128.1 of the Income Tax Act most property is deemed acquired at fair market value on arrival. Your US basis stays where it was.

NB specifics:

• Provincial tax. Brackets top out at 19.5%. Combined top rate about 52.5%.
• Sales tax. 15% HST.
• NB Medicare. Register on arrival; coverage generally begins the first day of the third month after you establish residence.
• Property. No provincial land transfer tax; a real property transfer tax of 1% applies on purchase. Property tax on non-owner-occupied residential property is assessed at a higher rate.

What follows you from the US

• Annual 1040 with Form 1116 foreign tax credits; NB's rates cover the US liability on employment income.
• FBAR and Form 8938 on Canadian accounts above thresholds.
• PFIC. Canadian mutual funds and Canadian-listed ETFs each require Form 8621. Hold US-listed ETFs instead.
• TFSA. Taxable in the US and potentially a foreign trust. Skip it.
• RRSP. Canadian deduction, US deferral under the treaty.
• Roth IRA. Article XVIII(7) election on the first Canadian return; no contributions after arrival.
• 401(k) and IRA. Stay in the US; taxable in Canada on withdrawal with a foreign tax credit; section 60(j) rollover available.
• T1135 once non-Canadian property exceeds $100,000 CAD in cost (arrival year exempt).
• Maine and Massachusetts exit. File part-year returns and close residency formally.

Who moves to New Brunswick

Cybersecurity and IT professionals into Fredericton, energy and industrial staff into Saint John, logistics and customer-operations staff into Moncton, academics, and Americans with Maritime families. The Maine-to-NB path is short and busy.

Worked example

An American cybersecurity engineer moves from Boston to Fredericton on June 1 with $250,000 in a US brokerage account (US basis $180,000), $220,000 in a 401(k), and a Roth IRA of $60,000.

• Arrival. Brokerage deemed acquired at $250,000 for Canadian purposes; US basis stays at $180,000.
• 401(k). Left in place.
• Roth. Article XVIII(7) election on the first T1; no further contributions.
• NB. Salary taxed at combined rates reaching 52.5%; foreign tax credit covers the 1040. Medicare from the first day of the third month.
• Reporting. FBAR and Form 8938 on new Canadian accounts; no TFSA, no Canadian mutual funds.

Official sources

"You become a resident of Canada for income tax purposes when you have enough residential ties in Canada." — Canada Revenue Agency, Newcomers to Canada, https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/individuals-leaving-entering-canada-non-residents/newcomers-canada-immigrants.html

New Brunswick's top personal income tax bracket: "19.5% over $190,060". — Government of New Brunswick, Personal Income Tax, https://www2.gnb.ca/content/gnb/en/departments/finance/taxes/personal.html

"If you are a U.S. citizen or resident alien, the rules for filing income, estate, and gift tax returns and paying estimated tax are generally the same whether you are in the United States or abroad." — Internal Revenue Service, U.S. citizens and resident aliens abroad, https://www.irs.gov/individuals/international-taxpayers/us-citizens-and-resident-aliens-abroad

Practitioner note

Americans arriving in New Brunswick from Massachusetts sometimes assume the foreign tax credit will leave nothing owing in the US. On employment income that is usually true. On US-source dividends and capital gains, Canada's tax can be lower than the US tax, and a residual US bill remains. We model both returns before the move so the first April is not a surprise.

Other provinces: Alberta · British Columbia · Manitoba · Newfoundland and Labrador · Nova Scotia · PEI · Quebec · Saskatchewan

Next step

Fairlight prepares the first Canadian return, the ongoing US return with foreign tax credits, and the FBAR and Form 8938 filings for Americans in New Brunswick. See cross-border pricing or book a call.