Canada has all the qualities of a top global retirement haven. It’s naturally beautiful, with plenty of rugged nature that offers opportunities for outdoor recreation. It has interesting cities rich in culture. It’s home to friendly people, high-quality health care and — outside of its major cities — it can be affordable. Plus, it’s geographically close to the U.S., which is convenient if you plan to travel back and forth.
But retiring in Canada is not as simple as packing up your house and driving north across the border. As with any international move, it requires careful planning and research. Here’s an overview of the steps to take to retire in Canada.
— Decide which part of Canada is right for you.
— Research residence permits.
— Make your finances accessible from anywhere.
— Understand your tax obligations.
— Consider your options for health care.
— Decide what to do with your household effects.
Decide Which Part of Canada Is Right for You
Canada is a vast country — the second biggest in the world. The first step in retiring in Canada is deciding which area of the country to move to. This should involve some in-person research. Visit as many areas of the country as possible to determine which is right for you. Narrow down your list of options, then aim to take extended stays in each place on your shortlist so you can experience it during different seasons.
When you finally settle on a location to retire, you’ll need to find a place to live. You should rent first — for a year or longer — before you buy property. Renting gives you more flexibility, allowing you to try different neighborhoods before you commit to a home.
[Read: How to Retire in France]
Research Residence Permit Options
As a visitor, you can stay in Canada for up to six months at a time. This could be the perfect amount of time for someone who wants to live in Canada part time.
To stay for longer than six months, you’ll need a residence permit. Canada doesn’t offer a retiree-specific residence permit, and it can be challenging to acquire residency unless you already have family living in Canada. If so, you can immigrate to Canada through family sponsorship.
If not, other options, such as Express Entry, are available. This option is designed for skilled workers from specific industries who want to participate in the Canadian workforce and contribute to the economy. Other paths to a residence permit include the startup visa, designed to attract entrepreneurs; the Atlantic Immigration Program, available to graduates from institutions in Canada’s Atlantic provinces; and provincial nomination, for those with the skills, education and work experience that allow them to contribute to the economy of a specific province or territory.
Make Your Finances Accessible From Anywhere
Before you leave the United States for Canada, you should organize your financial affairs so that you can access your bank accounts and pay your bills remotely. To check your balance, make transfers and pay bills, familiarize yourself with online banking and payment apps, including your bank’s mobile app. The last thing you want is to fly back to visit your bank in person each time a banking matter comes up.
You can receive Social Security benefits while living in Canada. You may want to inform the Social Security Administration about your move abroad, although you can only update your mailing address if you’re already getting benefits. Let the IRS know about your move using its change of address form, 8822, and register as an overseas voter if you want to continue participating in U.S. elections.
[Read: Where Retirees Can Buy a Home Overseas for Under $100K]
Understand Your Tax Obligations
As a U.S. citizen, you will always be required to file a tax return with the IRS. However, if you become a full-time resident of Canada, you may also have a tax obligation with the Canada Revenue Agency, the Canadian equivalent of the IRS. Tax matters are complex and can vary significantly from person to person, so it’s important to speak to tax specialists who can advise you on the best approach to managing taxes on both sides of the border. The good news is that Canada and the U.S. have a tax treaty in place, which helps U.S. citizens living in Canada avoid paying tax on the same income twice.
Consider Your Health Care Options
Canada is known for providing universal health care to its residents. It can be a good choice for receiving high-quality care. To get health care as a new resident of Canada, you’ll need to apply for a health insurance card from your provincial or territorial government. This will provide access to public health care services. Private health insurance is also available.
However, just as the best approach to managing taxes will depend on your unique circumstances, so will the best approach to managing your health care. It’s important to note that Medicare coverage outside the United States is limited. It only applies in Canada in specific circumstances. That said, maintaining Medicare can be a great option because of Canada’s proximity to the U.S. If you plan to return to the U.S. often after you move or you live in a city close to the U.S. border, you can continue to have your health care needs met stateside using Medicare.
[Related:10 Places to Retire Abroad on Social Security Alone]
Decide What to Do with Your Household Effects
If your plan to retire to Canada involves moving out of your current home in the U.S., you’ll have to decide what to do with your household effects. Your options include moving everything to Canada, downsizing or storing your possessions. If you bring your stuff to Canada, collect quotes from different moving companies or pack up a moving van and drive it to your new home. Make sure to factor in the cost of movers and import duties into your overall budget. Any personal or household items worth CAD 10,000 ($7,233) or more, including cars, are subject to duty and taxes.
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How to Retire in Canada originally appeared on usnews.com
Update 10/29/24: This story was previously published at an earlier date and has been updated with new information.
