Toronto to San Antonio: USAA, Military Tech, and Zero State Income Tax

San Antonio's financial services sector (USAA, Frost Bank), its military and cybersecurity contractors, and its healthcare systems recruit Toronto's finance, technology, and healthcare professionals. The move is one of the largest rate cuts on the map: Ontario's combined top rate of about 53.5% becomes a federal-only 37%, and San Antonio's home prices are the lowest of any major Texas metro.

Key takeaways

• Ontario's roughly 53.5% top rate, including the provincial surtax, sets the departure tax. On a $300,000 unrealized gain, about $80,000.
• Texas has no state income tax; US tax is federal only.
• 13% HST becomes 8.25% sales tax in San Antonio.
• Bexar County property tax runs about 2%; file the homestead application after you move in.
• OHIP ends on permanent departure. Keeping the Toronto home means NR6, Section 216, and the Vacant Home Tax if empty.

The Ontario departure

Departure tax applies to non-registered investments, private company shares, crypto, and foreign property at fair market value on the departure date. Ontario 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. The Toronto home: sell it under the principal residence exemption, rent it under NR6 and Section 216, or face Toronto's Vacant Home Tax if it sits empty. OHIP ends on permanent departure.

San Antonio's side

No income tax; Bexar County property tax near 2% effective with a homestead exemption and a 10% annual appraisal cap; 8.25% sales tax; no estate tax; strong homestead creditor protection. Home prices are among the lowest of any major Texas metro.

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

RSUs vesting after the move are split by working days between Canada and the US; the state and any local authority tax their share. Both payrolls may withhold on the full amount; the excess is recoverable on the first-year returns.

Who makes this move

Bay Street finance staff to USAA and Frost Bank, Toronto software engineers to San Antonio's tech and cybersecurity employers, Ontario healthcare professionals to the city's hospital systems and the South Texas Medical Center, and Toronto defence professionals to the Joint Base San Antonio contractor base.

Worked example

A Toronto insurance analyst moves to San Antonio on June 30 with $220,000 of unrealized gain in a non-registered account, $450,000 in an RRSP, RSUs vesting after the move, and a Toronto condo sold in the departure year.

• Departure tax. $220,000 gain, $110,000 taxable, at about 53.5%: roughly $59,000.
• Condo. 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%.
• San Antonio. No state income tax. HST 13% becomes sales tax 8.25%. Property tax on a $500,000 home around $10,000 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/

There are 5 Ontario income tax brackets and 5 corresponding tax rates. — Government of Ontario, Personal income tax, https://data.ontario.ca/dataset/personal-income-tax-rates-and-credits

Practitioner note

Toronto-to-San Antonio is a clean file with one Texas-side item: the homestead application, which caps appraisal growth at 10% a year and removes a fixed amount from school district taxable value. File it the year you move in.

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

Next step

Fairlight prepares the Ontario departure return, the property filings, and the first-year US return for San Antonio clients. See cross-border pricing or book a call.