Retirement plans in Canada

[shakira2009]

Hi all,

I'd like to know what kind of retirement plans are available in Canada.

I heard something about the RRSP, but am not sure of other options.

Is there anything specific made for immigrants?

Where can I find out more information of the overall picture (general info + as many options as possible)?

Thanks for your help!

 

[toby]

AN RRSP is for those who have invested into it during their working years. They deposit up to their individual limit each year, tax free, but pay tax on withdrawals. The RRSPs of taxpayers are, of course, not available to immigrants.

CPP (Canada Pension Plan) is also available in proportion to how much you have contributed during your working (taxpaying) years. It is not available to recent immigrants who have made no contributions.

If you are asking what social programs (payments) are available to immigrants who have not paid taxes to Canada during their workling years, there is Old Age Security, but again this depends on how many years you have spent in Canada.

Welfare is available to recent immigrants who don't have much income.

 

[shakira2009]

Hi toby,

Thank you very much for the info!

A friend also gave me this link http://www.servicecanada.gc.ca/eng/lifeevents/retirement.shtml, so I was able to find more details about CPP and OAS.

About the Old Age Security though, the conditions to get your retirement pension are:
1. to reach 65 years of age, and
2. to have lived in Canada for 10 or more years

... just that? They give you the pension even if you haven't contributed at all???

And another question:
For CPP for example, how is the monthly contribution calculated?

 

[toby]

CPP contriobutions are based on income, up to a max amount (about $30K). ABove that amount your contributions don't increase, but neither do your CPP payouts at retirement. Every one has a right to their CPP payments if they have contributed. The payout is based on contributions, and the length of time you made those contributions.

OAS is a social program, based partly on need, partly on time spent in Canada. It is not meant as a freebie for recent immigrants, since the payout is based on time spent in Canada. Please re-read the OAS explanation. I vaguely recall the ten-year rule, but there are other rules that also determine whether you are entitled to the full OAS payout or just a fraction.

Theoretically (I guess) someone could spend a lifetime in Canada, not working, and get full OAS payouts. But if you arrived (say) 5 years ago, your OAS payout would be quite small. You can call the OAS people when the time comes, and they'll calculate the payout for you. But you seem a long way off from OAS time. LOL

 

[shakira2009]

toby,

Thank you again for your answers!

Now that you gave me this valuable info, I'll continue doing research myself.

 

[cono_sur]

You should also consider making use of Tax-Free Savings Accounts (TFSA's).

 

[shakira2009]

OK, will do. Thanks!

 

[havanis]

what happens with the workyears you did make in your birthcountry , after emigrating to Canada ?
Do you lose everything because you 'r no longer a member of that country you 'r coming from, does that earned pensionmoney no longer belong to you ... or what ?

 

[Saif1587]

AN RRSP is for those who have invested into it during their working years. They deposit up to their individual limit each year, tax free, but pay tax on withdrawals. The RRSPs of taxpayers are, of course, not available to immigrants.

RRSPs are not available to immigrants? Pls. clarify. As a first time Tax filing and PR why cant some one buy/get RRSP?

 

[veri]

I am almost sure immigrants can have RRSP accounts.

According to this webpage http://www.settlement.org/sys/faqs_detail.asp?faq_id=4000267:

Who is eligible for an RRSP?

You are eligible to open an RRSP if you:

Are a Canadian resident for tax purposes* and file income taxes in Canada;
Are 71 years old or under; and
Have an income.

*Residence for tax purposes is different from residence for immigration purposes. Find more information about your tax status in Canada.

 

[Saif1587]

I am almost sure immigrants can have RRSP accounts.

According to this webpage http://www.settlement.org/sys/faqs_detail.asp?faq_id=4000267:

Who is eligible for an RRSP?

You are eligible to open an RRSP if you:

Are a Canadian resident for tax purposes* and file income taxes in Canada;
Are 71 years old or under; and
Have an income.

*Residence for tax purposes is different from residence for immigration purposes. Find more information about your tax status in Canada.

thanks for clarifying