Moving to Nova Scotia from most other provinces could cost people a lot of money if they move at the wrong time, a tax expert warns.

Joel Gillis at Tax Depot says where you live on Dec. 31 determines which province charges you taxes.

The federal rate is the same across Canada, but provincial and territorial income tax rates and tax brackets — and therefore overall tax bills — vary widely from one part of the country to the next.

Nova Scotia has one of the highest tax rates in the country. Only Quebec collects more taxes. The lowest-taxed area is Nunavut. 

Gillis cites the case of a man who moved in mid-December from B.C. to Nova Scotia.

“So instead of getting back almost $1,000 in B.C., he owed around $2,500 in Nova Scotia,” Gillis said. “If he had of known that, he could have moved in January.”

Gillis says even if you travel back and forth to work in Alberta, your place of residence remains Nova Scotia.

It makes a big difference. Using an average 2010 return for an income of $40,000, the result is:

  • $537 return in Nova Scotia
  • A $1,736 return in Alberta

If you earn $80,000, it gets worse:

  • Owe $3,200 in Nova Scotia
  • Receive a $343 return in Alberta

Gillis says people have to move to another province to get the lower rate. He advises people who work out west and live in Atlantic Canada, to make sure the employer is taxing at Nova Scotia rates to avoid a shock when the bill comes.