Canada currently has international social security agreements with over 50 countries. These agreements coordinate pension programs for people who have lived or worked in two countries.
Included in the 50 countries are the United States, France, Germany, Australia, Japan, as well as many smaller countries. Canada has only a limited agreement with the United Kingdom.
To get a list of all the countries with which Canada has agreements with and explanations of each agreement, visit the Service Canada website.
Most of the agreements are similar, and are generally designed to do two things:
- Eliminate duplicate coverage, for example where an individual lives in one country while working temporarily in another country
- Eliminate gaps in coverage, where an individual has contributed to both countries but doesn’t have enough contributions to qualify for benefits in one or both countries.
While both objectives are important, this article will deal exclusively with how the agreements eliminate gaps in coverage.
What is the meant by gaps in coverage?
Eligibility for social security benefits in Canada and in most other countries generally requires that you meet some minimum contributory criteria. For example:
- You must have resided in Canada for at least 10 years after age 18 in order to be eligible for even a partial Old Age Security (OAS) pension.
- You must have resided in Canada for at least 20 years after age 18 in order for your OAS pension to be permanently payable outside of Canada.
- You generally must have contributed to the Canada Pension Plan (CPP) for four of the last six calendar years in order to be eligible for a CPP disability benefit.
- You must have contributed for one-third of the years in your contributory period in order to be eligible for CPP death or survivor benefits.
Meeting these minimum contributory requirements is generally not difficult if you’ve lived your entire life in Canada. It is much more difficult if you’ve moved to or from another country partway through life. Without a social security agreement between those countries, people might not qualify for benefits from one or both of those countries.
Social security agreements can affect whether you meet the minimum contributory requirements to receive benefits (what I call eligibility), but they don’t affect the amount of those benefits (what I call entitlement).
Let’s look at an example: Peter was born in another country and moved to Canada at age 35 and lived here until age 50, at which time he then returned to his country of birth.
Without a social security agreement, Peter won’t be eligible for any OAS when he reaches age 65. This is because he has less than the necessary 20 years of residence in Canada in order to be eligible for OAS outside of Canada. With an agreement, he may be able to count years of residence or contributions in that other country to meet the minimum eligibility requirement of 20 years to qualify for OAS from Canada. The amount of his OAS benefit entitlement, however, will be based solely on his 15 years of residence in Canada.
You have to apply separately to each country for any benefits that you might be eligible for.
All CPP and OAS applications have a question that asks you to list any other country that you have lived or worked in. If you don’t meet the minimum eligibility requirements for CPP or OAS based just on your Canadian contributions/residence, your application will be considered under any International Agreement that might apply to you.
The process of confirming your contributions/residence in that other country generally takes several months, but if this gives you enough combined contributions/residence to meet the minimum eligibility requirements, it means that your application for CPP or OAS will be approved and not denied. Again, the amount of your benefit entitlement will be based solely on your Canadian contributions/residence.