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Retiring Abroad: What You Need To Know
EI Compassionate Care Benefits


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The opinions expressed herein are my own personal opinions and do not represent my employer's view in any way.

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# Tuesday, May 20, 2008
Tuesday, May 20, 2008 3:04:40 PM (GMT Daylight Time, UTC+01:00) ( General Life )

For many retiring Canadians, living outside of the country either full-time or part-time can be an attractive option. Whether choosing to winter in a warmer climate, or altogether moving to a different country, you need to be aware of the financial issues surrounding these decisions. Canadians can reside in another country without having to give up their Canadian citizenship; however you will still be subject to Canadian taxation laws. It's important to understand the taxation and financial regulations of either living abroad.

There are many things to consider when deciding where to spend your retirement years. If you are planning on living outside of Canada, you should do some research on the country where you plan on moving to. You will need to research that particular country's immigration regulations, as these vary greatly depending on the country chosen. You should also familiarize yourself with that country's laws, as well as political climate. Realize that countries you've enjoyed vacationing in may not offer the type of lifestyle you are accustomed to when it comes to actually residing there.

Financial and taxation issues are very important as well when contemplating to live outside of Canada. Some developing countries may seem to offer a lower cost of living; however many lack the resources to collect taxes on foreign sourced income, and instead will impose high consumption taxes and/or import duties. Especially for those who will be living on a fixed income and/or budget, you will need to thoroughly understand the financial implications of the country you are considering. You should also factor in the costs of traveling back to Canada as well as items such as larger phone bills to maintain contact with your friends/family.

Another major financial consideration will be health care and insurance. As Canada offers a very high standard of medical care, some countries may be considered inadequate by our terms. If you have specific health problems, i.e. diabetes, heart condition, you will need to ensure that your country of choice has medical facilities as well as physicians that are capable of giving you quality care. You will also need to obtain full health coverage as you will no longer be entitled to your Canadian provincial health care benefits.  Be aware that even if you have supplemental health insurance (to supplement your provincial healthcare plan), this will not be enough coverage when leaving Canada. If you are planning on living abroad only part time, remember that your provincial healthcare only provides limited coverage for up to only 3 months. Your level of provincial benefits will probably not be enough to fully cover any medical expenses that you may incur; it is advisable to have your own health insurance even when leaving Canada on a temporary basis. Depending on the length of your absence from Canada, you may also have to wait for your provincial health plan to be reinstated, which will temporarily leave you without health insurance coverage.

If you are planning on leaving Canada to live in another country (either full or part time) you will need to ensure that your passport is valid, and doesn't expire while you are out of the country. You will also need to open a bank account in your new country; it is a good idea beforehand to research their banking regulations. You may also want to have a safety deposit box in order to safeguard copies of your documents, i.e. birth certificate, identification which bears your photo, etc. You should also have the numbers of the Canadian consulate on hand should you require these in an emergency. As well, have a copy of your visa (if it is required).

If you are planning on permanently residing in another country, you will need to establish a legal status there, i.e. permanent residency or citizenship status. Requirements for legal status vary greatly from country to country, but usually will be based on principles such as employment status, investment status, and/or family connections. Some countries may recognize people such as retirees with a guaranteed minimum income as potential immigrants. Many countries will require proof of guaranteed income in order to establish sufficient support for the retiree and any dependents. You will need to provide financial documentation supporting your claim that you meet these requirements; have copies of bank statements, investments, RRSP’s, etc ready in order for submission.

You can still receive your Canadian Public Pensions while living abroad, provided that you still qualify for the benefit. Old Age Security (OAS) requires that you lived in Canada for at least 20 years after the age of 18; as this benefit is subject to an income test, you will need to file an annual tax return which reports your worldwide income. Canada does impose a withholding tax on "passive" income paid to nonresidents from Canadian sources. This includes interest, dividends, RRSP income, rental income, RRIF income as well as pension income. This rate is usually 25%; but may be reduced depending on the terms of any tax treaties that exist between Canada and your new country of residence. You will also be required to file tax returns in Canada if you are still receiving income that originates in Canada, i.e. income from a business in Canada, the sale of taxable property, or any income that is earned. However, you may also be entitled to a tax refund on such items as rental income and/or pension income if your taxable income is low enough to qualify.

If you are planning on retiring and living outside of Canada, you may want to obtain advice regarding the financial and taxation issues. Do your own research about any potential countries you are interested in, either on a part or full time basis, so you can better plan ahead. Remember, the earlier you start planning, the better prepared you will be when you actually retire.

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# Thursday, May 01, 2008
Thursday, May 01, 2008 9:27:46 PM (GMT Daylight Time, UTC+01:00) ( General Life )

The majority of working Canadians have Employment Insurance (EI) deducted from their wages. This insurance is intended to provide temporary financial assistance to those who are unemployed and looking for work and/or upgrading their skills. EI also provides financial assistance for other reasons though; such as maternity leave, work absence due to illness, caring for a new child, as well as short-term help for those who need to care for a family member who is seriously ill with a significant risk of death.

Compassionate Care Benefits are intended to help those who are employed, but who need a short leave of absence in order to care for a relative that is gravely ill and at risk of dying within 26 weeks. People who are collecting EI at the time can also ask for this benefit. This benefit is payable up to a maximum of 6 weeks; however, it can be shared among eligible family members (i.e. 3 siblings can each claim 2 weeks to be used in succession.)

In order to be eligible for Compassionate Care benefits, you must be able to prove that your regular weekly earnings have decreased by more than 40%. As well, you must have accumulated 600 insured hours within the last 52 week period, or since the start of your last claim. This is known as the qualifying period. There is a 2 week waiting period; however if the 6 week period is shared by family members, only the first person will serve the waiting period.

EI recognizes family members as either your blood relative or a blood relative of your spouse (if common law spouse, you must have resided together for at least one year). These relatives include:

• Your child or the child of your spouse
• Your wife/husband or common-law partner
• Your parent or the parent of your spouse
• Step-parent or common-law partner of a blood parent
• Sibling or step-sibling, as well as sibling or step-sibling of your spouse
• Father or mother in law, either married or common-law
• Son or daughter in law, or your spouse's son or daughter in law
• Uncles and aunts, as well as their partner; or your spouse's uncle or aunt, or their partner
• Nephew and nieces; also a nephew or niece of your spouse
• Current or former foster parent; current or former foster parent of your spouse
• Current or former foster child as well as their partner
• Current or former ward; current or former ward of your spouse
• Current or former guardian or their partners

There is also a provision for someone who although they are not "related" they do consider you as a family member, i.e. friend or neighbor. In this case, a Compassionate Care Benefits Attestation is required from the person who is gravely ill and requesting your help. Care/support is defined as providing psychological/emotional support, arranging care through a third party, and/or directly providing or participating in care.

When applying for Compassionate Care benefits, you will be required to provide documentation proving that the ill family member is in need of care/support, as well as being at risk of dying within 26 weeks. 2 forms will be required to be submitted:

• Authorization to Release a Medical Certificate which is completed and signed by the ill relative or their legal representative
• Medical certificate for Employment Insurance Compassionate Care Benefits which is completed and signed by the ill relative's medical doctor to confirm the significant risk of death within the prescribed 26 weeks

These forms must be submitted at the same time; as well, the applicant assumes the cost of any fees charged by the doctor/legal representative. Only one Medical Certificate is required even if several family members are sharing the 6 weeks leave. If more than one is submitted, the first one submitted will determine the beginning and end of the 6 week period. Compassionate Care benefits end when either the 6 weeks have been paid up and the time period has expired, you have exhausted the maximum payable benefits allowed for your claim, or if the family member dies or no longer requires care and support. If the family member dies while you are receiving this benefit, it is your responsibility to immediately inform the administrator of your benefits in order to prevent EI overpayments.

For more information regarding eligibility as well as the complete list of requirements regarding this benefit, please visit the Service Canada website.

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