Advice for retiring in Canada from the US

[MikeK]

Does anyone have experience with moving to Canada in ER? I'd love any advice you have.

I have specific interest in utilizing the Canadian health care system and tax implications of having investments/income coming from the US.

We would like to live in Canada for part of the year to be near my wife's family; but we'd also like to live elsewhere (US or abroad) during the fierce/bitter Canadian winters.

Mike K.

[ShokWaveRider]

We are in Canada. When you move after 3 months, if you are a citizen you can get health coverage (Ontario). We left California last year and spent the winter in the Caribbean, Then we returned to Toronto to spend the summer with family. We will be returning to the Caribbean in November (If it is still there ). Then next year we will come back and most likely move out west to British Colombia to look for a home. Hopefully prices will stabilize. Canadians are taxed on worldwide income, but there is a treaty with the US and there is no double taxation. If you are not a citizen I am not sure of health care but you are exempt from taxes from overseas sources for 5 years.

SWR

[bruce1]

Canadian Winter There is nothing so invigorating as being out in bush on a crisp winter day in January. Try parts of BC or Southern Ontario, they don't have real winter. If you are not a citizen you might try landed immigrant status and see how that would work for medical.

Bruce 8)

Quote:

Try *parts of BC

They even have palm trees in these parts 8)

[Calgary_Girl]

I am a Canadian citizen and my husband is American but his legal status in Canada is "Landed Immigrant" and therefore he has healthcare coverage.

If you plan on retiring here and having healthcare coverage, you will need to show the Canadian government that you will be living in Canada the majority of the year (ie. at least 183 out of 365 days of the year). This is why quite a few Canadians are "Snowbirds"...they spend the winters in a warm climate but only for 4 or 5 months so they don't lose their healthcare coverage and return to Canada for the spring, summer and fall.

Even though my husband doesn't have any U.S. income, he is still legally obligated to file a U.S. income tax return every year showing his Canadian income. He doesn't have to pay dual tax but it is still a pain-in-the-you-know-what to file the U.S. return.

As a side note, I have to disagree about Canadian winters being "fierce/bitter"...it's not Siberia for pete's sake. We've actually had warmer days in winter here than my husband's hometown of Boston.

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As a side note, I have to disagree about Canadian winters being "fierce/bitter"...it's not Siberia for pete's sake. We've actually had warmer days in winter here than my husband's hometown of Boston.

Us Minnesotans aren't afraid of Canadian Winters. The Canadian Coasts have winters that are down right balmy compared to what we get in the Midwest.

[farmerEd]

>>Even though my husband doesn't have any U.S. income, he is still legally obligated to file a U.S. income tax return every year showing his Canadian income.

Ain't that nutty? A friend of mine moved out of the US over 20 years ago...lives in Germany, married a german, owns a business in germany, has 4 kids in germany etc etc....and yet the US government feels they still "own" him...no matter how long you are gone, no matter where you go. You are property of the US government. Guess we aren't really all that free afterall...

[Billy]

Unless your friend gives up his US citizenship, he must file.

Billy
Website www.geocities.com/ba264

[ordway]

How does the "retire in Canada" thing work? I find Canadian culture and climate pretty appealing (yes, I like cold weather!), and of course the health care is a big plus. I did look into the rules for Canadian immigration, and they seemed pretty strict about requiring that you have a job lined up. But obviously, to retire in Canada the plan would be to *not* work any more!

So, how can you get accepted as a "landed immigrant" in retirement?

[MikeK]

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As a side note, I have to disagree about Canadian winters being "fierce/bitter"...it's not Siberia for pete's sake. *We've actually had warmer days in winter here than my husband's hometown of Boston.

Thanks, Calgary Girl. I know Calgary well. My wife just got back from a one week trip. Unfortunately, a likely scenario is for us to live in Winnipeg, where her parents and Grandmother live. Winnipeg is a close cousin to Siberia .

I'm American and my wife is Canadian. Do you know if my wife and her family would be automatically eligible for healthcare upon our arrival? My wife has worked in Canada as an adult but she's been living in the States (and Japan) for the past 10 years.

The 6 months in Canada is helpful. Do you need to buy extra insurance when you are in a foreign country? Or does the Canadian system reimburse you?

Mike K.

[MikeK]

Quote:

Even though my husband doesn't have any U.S. income, he is still legally obligated to file a U.S. income tax return every year showing his Canadian income. *He doesn't have to pay dual tax but it is still a pain-in-the-you-know-what to file the U.S. return.

Can anyone give me details on what taxes I would have to pay and to which government? I expect my investments to be at Vanguard and to transfer money into a Canadian bank account once or twice a year. I'm confused if I'll need to pay the higher Canadian taxes and then ask for an exemption from the US government; or do I pay the US taxes and not have to file in Canada?

The only good thing is that my Canadian relatives tell me their tax system is much easier to calculate and file.

[Hyperborea]

Quote:

Can anyone give me details on what taxes I would have to pay and to which government?

I can't give you exact details but I can give you some ideas. You will have to file Canadian taxes on your worldwide income. You will have some tax deducted at source by some of your investment holders and that will go onto the Canadian taxes that you will file as a deduction. You will also have to file US taxes (for life) and you will use the Canadian taxes as a deduction against the US ones. You won't be able to file "Married Filing Jointly" in the US unless your wife also submits to US taxation. The calculations will be messy. You may want to pay somebody to do this for the first year or two so that you can make sure that all the details get looked after.

Canadian taxation will not neccesarily be greater than the US taxes. You will need to learn different strategies and tricks for tax minimization as the tax rules are different. Every person files their own taxes so splitting your income as evenly as possible between yourself and your wife will lower youer taxes. Capital gains have a very low rate in Canada as only half of the gains are taxed at your marginal rate (or equivalently all of the gains are taxed at half your marginal rate).

I would download the tax forms from the Canadian government web site and do some mock returns or see if you can pick up last year's Canadian tax software in a discount bin somewhere.

A good site for some discussion on this is http://grasmick.com/board/

[sach]

Mike , According to Canadian Immigration they discontinued the retirement visa in 1991. Check out the link below

http://www.faqs.org/faqs/canada/immi...ection-25.html

sach

[Calgary_Girl]

The two ways that I know of to immigrate to Canada are: 1) Find employment and get the Canadian company to sponsor your work permit (how my husband did it); or 2) Get a family member already in Canada to "sponsor" you (which may take longer).

My husband was able to enter Canada because he found employment here but I sponsored him for Permanent Residency and now he can work for any employer he chooses. It took over a year to get approved for the Permanent Residency because the government does an extensive background check (i.e. criminal background check with the American government; wanted to make sure that our marriage was "legit" and not a marriage of convenience just to get my hubby in the country; I also had to provide financial statements showing I could support my husband for 10 years....and on and on....)

I believe the U.S. immigration system is similar. I lived in the States for two years and was able to enter the country on a work Visa.

[Calgary_Girl]

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Thanks, Calgary Girl. *I know Calgary well. *My wife just got back from a one week trip. *Unfortunately, a likely scenario is for us to live in Winnipeg, where her parents and Grandmother live. *Winnipeg is a close cousin to Siberia *. I'm American and my wife is Canadian. *Do you know if my wife and her family would be automatically eligible for healthcare upon our arrival? *My wife has worked in Canada as an adult but she's been living in the States (and Japan) for the past 10 years. The 6 months in Canada is helpful. *Do you need to buy extra insurance when you are in a foreign country? *Or does the Canadian system reimburse you? Mike K.

Hi Mike. I'm not sure if your wife would automatically be eligible for healthcare since every province regulates its own healthcare system. She would need to check on Manitoba's system and if there is any waiting period, etc. I know in Alberta I didn't have to wait at all before I was eligible to "re-enroll" after living in the States for 2.5 years. Also, I was able to add my husband to Alberta healthcare even though he was an American citizen. It probably helped that he had a 3 year work permit though.

The healthcare system in each province is fairly basic and quite similar - they cover basic things like visits to the doctor, your hospital room, etc. They do not cover things like prescriptions, x-rays, dental visits....all of the big expenditures. You should look at "topping up" your healthcare coverage for this and also if you are planning on traveling a lot to the States as a Snowbird. This can be done through private health insurance like Blue Cross. Before you get too scared, private health insurance in Canada isn't as outrageous as it is in the States....my husband and I were both fully covered for $120/month (not including the $88/month that we pay for Alberta Healthcare - the "basic" coverage). We are in our early 30's so for someone in their 60's it would be more than $120/month but certainly not astronomical.

BTW, I have to agree with you about Winnipeg being a close relative of Siberia's

[Calgary_Girl]

The latest and greatest update for Alberta (where I live) is that seniors don't have to pay healthcare premiums anymore. I guess this is one of the perks of being a debt free province (our provincial government announced last month that we will have enough moola to pay off the last of our debt this year)

I also got some more info on prescription drug coverage in Alberta (you will have to look into Manitoba's coverage) - Seniors don't have to pay any premiums and they only have to pay 30% of the drug cost (to a maximum of $25) for each drug prescribed.

Sounds like a deal to me....I think I'll stay in Canada in my old age

[MikeK]

Calgary Girl,

Thanks for the update. Your information is very helpful.

It seems that we shouldn't have much trouble moving to Canada. Now we just have to make the decision. It was another perfect day in Northern California. This is Utopia (except for the high cost of housing).

My wife would actually prefer going to Calgary -- lots of friends, better weather and a more compatible lifestyle.

Mike K.