What happens to your CPP, OAS, RRSP, and TFSA when you retire outside Canada — and the tax rules every Canadian expat retiree must understand.
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Open KOHO Free — Code 45ET55JSYABoth CPP and OAS are portable — they are paid to eligible Canadians worldwide regardless of where they live. You do not need to be a Canadian resident to receive these benefits. This makes them reliable income anchors for Canadians retiring to lower-cost countries in Europe, Asia, Latin America, or elsewhere.
OAS requires 20 years of Canadian residence after age 18 for non-residents. CPP has no residency requirement — only contribution history matters.
Once you become a non-resident of Canada, Canadian income (CPP, OAS, RRSP/RRIF withdrawals, pension income) is subject to non-resident withholding tax, typically at 25%. However, Canada has tax treaties with over 90 countries that reduce this rate:
| Country | Treaty Withholding Rate (Pension) |
|---|---|
| United States | 15% (OAS/CPP); 25% (RRSP/RRIF unless periodic) |
| United Kingdom | 0–10% |
| Portugal | 10% |
| Mexico | 15% |
| Costa Rica | 25% (no treaty) |
| Thailand | 25% (no treaty) |
File NR5 with CRA to apply for reduced treaty rates. File NR73 to determine residency status if uncertain.
When you become a non-resident of Canada, CRA deems you to have sold (and repurchased) most of your capital property at fair market value on the date of departure. This "departure tax" can trigger significant capital gains on non-registered investments, stocks, and rental properties. RRSP, RRIF, and TFSA accounts are not subject to deemed disposition — they continue as-is.
Once you become a non-resident, you can no longer contribute to a TFSA. Worse — if you contribute while a non-resident, you are charged a 1%/month penalty tax on those contributions. Your existing TFSA balance can remain in Canada, but withdrawals may be subject to withholding tax depending on treaty status. Many Canadians close their TFSAs before departing to avoid complications.
Leaving Canada means losing provincial health insurance coverage, typically after 6 months abroad. You must arrange private international health insurance. This is a significant cost consideration for retirees planning to live abroad full-time — international health coverage can cost $3,000–$8,000+/year depending on age and destination.
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