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Retirement for Expats in Canada

Author: Jason Zhou
Submitted: December 2013

Visa issues

According to the Human Development Report commissioned by the United Nations Development Program, Canada is one of the top ten places to live. There are many people planning to retire to Canada due to the comparably lower living costs, lower property prices and abundant natural attractions. However, you should bear in mind that you may need a visa to live in Canada.

If you are a Canadian citizen and have retired in another country, there are no restrictions on returning to Canada. If you do not hold such citizenship, retiring here can be difficult. The main barrier is to get a long term resident permit.

There is no specific retirement visa in Canada. People from certain countries such as the US, most of the EU countries, Australia and New Zealand are not required to obtain a visa if they plan to live in Canada for no more than six months in a year. Therefore, many of them can retire to Canada with a visitor visa in a condition of six months in and six months out. To see if you qualify for such conditions, check here https://www.cic.gc.ca/english/visit/visas.asp.

If you do not qualify, you will need to apply for a visitor visa which allows you to stay in Canada for 6 months. After 6 months you can apply to extend your stay, you will need to apply for this 30 days before your visa expires. As this will significantly increase the work you need to do each year to prepare for your visa application, you may consider obtaining a permanent resident permit through the following routes:

  • Business Immigration
  • Skilled Workers (Professionals)
  • Provincial Nomination Programs
  • Family Class Sponsorship
  • Canadian Experience Class.    

More information on these routes can be found here: https://www.canadavisa.com/canadian-immigration-visas.html .

Medical care and insurance

Canada has a very good reputation for its medical system. All Canadians are covered for health care under a program known as Medicare. Most medical procedures and services are covered by this plan at no cost to the patient. The Government sets scheduled fees for services and the ability of practitioners to charge in excess of these fees is strictly limited.

You should note there may be a long waiting list for such free services. Therefore, many retirees choose to buy private healthcare insurance as well.

You are not covered by the free public medical services if you have spent less than three months in Canada.  

Thinking about tax

Tax is always a significant part of life. Residents are subject to tax on their worldwide income and capital gains. Non-residents are subject to tax only on income and certain Canadian sourced capital gains.

Retirement benefits received by individuals from a foreign plan are taxable when received and are generally eligible for a foreign tax credit and the non-refundable pension credit.

Foreign incomes may be reduced under a double tax treaty between Canada and other jurisdictions.      

Where to retire

To decide where to retire some of the following points may be considered: the proximity of family and friends, a peaceful and quiet environment, the climate, local costs including house prices and daily expenses, local services such as access to health services and transportation. Retirement homes or villages may also be considered.

Financial planning

Most people would like to maintain their pre-retirement standard of living. However, many find their savings will not last as long as they expected. For example, as stated in recent research from HSBC, UK retirement lasts about 19 years on average and financial problems are likely to emerge after 7 years. The report can be found here: https://www.newsroom.hsbc.co.uk/press/release/brits_face_12_years_of_hardshi.  It is therefore recommended to have a detailed financial plan for retirement as early as possible.

 

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