Financial Advice For UK Expats In Canada
Canada continues to be an excellent choice for British expats moving abroad. With breathtaking nature, a friendly society and a high quality of life, it will be hard to get bored in this melting pot of cultures.
An exciting new life awaits, but the financial aspect of moving can be daunting. Our guide for expats will ensure that you’re ready to move your life and finances to Canada with ease.
Whether you're starting a new job or getting ready for retirement abroad, we can help you navigate the tax system, transferring your pension and more.
01 Expats In Canada: Visa requirements
There are a variety of visa options to consider for British citizens in Canada, and the best choice for you will depend on the nature of your work, or if you plan to retire.
02 Working in Canada
To obtain a Canadian work permit, it’s likely that you’ll need to have secured a job in advance, so your employer can sponsor you.
Canada Offers a Start-up visa program to those with a business strategy that promises to bring in trade and jobs to Canadian people. This is a costly and time-consuming process (up to 37 months), but if successful it means you and your family will have the right to settle in Canada, with support to get your business up and running.
03 Permanent Residency
Immigration to Canada can also be achieved by applying for permanent residency. This process can be simple if you are a skilled worker or qualified in a skilled trade.
The Canadian Government uses a comprehensive ranking system (CRS), to sort immigration applicants, so the more qualifications and experience you have, the better chance you stand of being chosen from a pool of applicants.
Alternatively, if you have a family member who is a citizen or permanent resident, they can sponsor your residency.
04 Retiring in Canada
Canada is a great destination for British citizens wanting to retire in a peaceful environment with great healthcare and a close connection to natural wonders.
Unfortunately, there is not a specific visa available for retirees, as Canadas immigration programme is focused on drawing in skilled migrants who will contribute to the economy.
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However, you may still be eligible for the following visas:
Work visa: depending on your age and skill set, you could plan to move to Canada ahead of your retirement. This would allow you to gain permanent residency.
Family sponsorship: Canada allows family members to sponsor visa applicants, if they can prove that they are able to support you financially
Parent/grandparent super visa: this 10-year visa is multiple entry and allows you to stay in Canada for up to two years at a time.
05 Can I Still Access My State Pension If I Move To Canada?
You can still receive your state pension once you move to Canada, provided you have paid enough national insurance contributions. The payments can be made directly into your new Canadian bank account, either every 4 weeks or 13 weeks.
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It’s important to inform the DWP of your move as early as possible to avoid any delayed payments and to arrange a payment schedule.
If you have a workplace or private pension, you may incur tax charges, and there are a few options available to ensure the move is as tax efficient as possible and to protect your retirement savings.
06 Paying Taxes in Canada
Canada taxes its residents progressively, and the rates you pay will vary on the province in which you are a resident.
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Canadian tax- residents are taxed on their worldwide income, whilst non- residents are only taxed on income sourced from Canada. However, thanks to a tax treaty with the UK, you will not be charged twice. In Canada, an individual’s tax residency status is determined on a case-by-case basis.
You may be considered a tax resident if:
Your primary residence is in Canada
You spend 183 days or more in the country
Your economic interests (employment) are in Canada
Your spouse or children live in Canada
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Income Tax
Your income tax bill will be the sum of two charges: federal income tax and provincial income tax. It’s important to seek professional advice to get a clear understanding of how much tax you’ll owe, but as an example, using the province of British Colombia, the tax rates for 2024 are as follows:
Federal income tax rates:
British Columbia income tax rates for 2024:
Various credits and deductions, as well as additional charges such as the Canadian Pension Plan contributions, and employment insurance charges will affect your final tax bill.
08 Capital Gains
50% of your capital gains for the year will be added to your income tax bill, after offsetting half of your capital losses. Capital gains are any income from interest, selling real estate, stocks or shares.
Principal Residence Exemption:
Canada allows you to exclude the capital gain from selling your primary residence from your income tax bill. If you can prove that the property is your main home, you will not be taxed if you sell it.
09 Property
Canada currently has a ban on foreign ownership of residential property, which was extended for another two years in February. This is an attempt to protect housing affordability and accessibility for Canadian people.
Whilst renting accommodation may be the best option for British expats in Canada for now, some exceptions may apply. It’s worth consulting with a professional to see if you could still meet the requirements to purchase property in Canada.
10 Healthcare
Canada’s world class healthcare system is free and accessible to all residents. To access the services, you’ll need to register for a health insurance card, which can take up to three months, so it’s important to prepare a private health insurance plan to cover you for this initial period. However, emergency medical services will still be available free of charge.
Each province and territory have their own regulatory bodies, so policies may vary.
Some expats still opt for private health insurance plans, to avoid wait times and cover any supplementary fees for dental or vision treatments. Cigna Global, Allianz, Bupa, and Sun Life Financial all offer health care plans for expats in Canada.
Our Verdict
A move to Canada can mean a life changing new adventure, but it won’t come without its complications.
It’s important to seek advice to help you navigate the complexities of the tax system, as well as to ensure that your pension pot will be protected when you move.