CPP and OAS for Immigrants: Eligibility, Residence Rules and Agreements

CPP and OAS for immigrants work differently from each other, and the difference decides how much pension a person who arrives in Canada at 30, 45 or 55 can expect. The Canada Pension Plan pays a retirement pension based on contributions made while working in Canada, with no minimum number of years. Old Age Security is based on years of residence in Canada after age 18. Social security agreements with India, the United States and many other countries can fill gaps. This guide explains eligibility, amounts, applications and tax for Indian-origin and American newcomers and for Canadians who retire abroad.

CPP and OAS for immigrants: how does CPP work?

CPP is funded by contributions on Canadian employment and self-employment earnings (Quebec has the separate QPP). For 2025, the employee and employer each contribute 5.95% on earnings between a $3,500 basic exemption and a maximum of $71,300, for a maximum employee contribution of $4,034.10. For 2026, the maximum earnings are $74,600 and the maximum employee contribution is $4,230.45. A self-employed person pays both halves, a maximum of $8,068.20 for 2025 and $8,460.90 for 2026. Earnings above the first ceiling can attract a second contribution, called CPP2, which the CRA lists separately.

To receive a CPP retirement pension you must be at least 60 and have made at least one valid contribution to the CPP, which usually means work you did in Canada. The amount depends on how much and how long you contributed, your average earnings and the age you start. The CRA excludes up to eight of your lowest-earning years for the base component and uses your best 40 years for the enhanced component. At 65 the maximum pension was $1,507.65 a month in January 2026, and Service Canada lists an average of $858.34 a month. Starting early cuts the pension by 0.6% for each month before 65 (up to 36% at age 60), and starting late raises it by 0.7% for each month after 65 (up to 42% at 70).

An immigrant who arrives at 45 and works 20 years before retiring will typically have a smaller CPP than a lifelong Canadian, because CPP reflects the contributory period. Other CPP benefits, such as disability and survivor benefits, have their own contribution tests.

How do the OAS residence rules work?

OAS is a residence-based pension. Service Canada says you must be 65 or older, a Canadian citizen or legal resident at the time your application is approved, and have lived in Canada for at least 10 years since age 18. If you have lived in Canada for less than 40 years after age 18, you receive a partial pension equal to years of residence divided by 40. The Old Age Security payment page lists maximums of $762.50 a month for ages 65 to 74 and $838.75 at 75 and over for October to December 2026. If you live outside Canada, you generally need 20 or more years of residence in Canada after age 18 to keep receiving OAS.

Two related points: the Guaranteed Income Supplement for low-income pensioners can be reduced or stopped if you have not filed your taxes, and OAS is subject to a recovery tax if your net income is over $93,454 (the 2025 figure the CRA lists).

What do the Canada-India and Canada-U.S. agreements do?

Canada has social security agreements with 65 countries, including India and the United States. They coordinate the pension systems so people who lived or worked in more than one country can combine periods to meet minimum requirements. They affect eligibility only: each country pays only on the periods it credits under its own program.

The India agreement works in both directions: Indian authorities may count CPP contributions and Canadian residence toward EPS eligibility. If you have already received a refund of your EPS contributions, the agreement cannot help you qualify in either country. The CRA also describes a detached worker rule for employees sent temporarily from Canada to India: if the posting is temporary and no longer than 60 months, CPP coverage can continue and the employer applies for a certificate of coverage.

How to apply, step by step

1. Check your timeline. CPP can start between 60 and 70. Service Canada may enrol you in OAS automatically; if no letter arrives about a month after your 64th birthday, apply yourself.
2. Gather proof of residence and work history from each country: immigration documents, Indian provident fund and EPS records, U.S. Social Security statements.
3. Apply through Service Canada. If you live in Canada, apply for Canadian benefits through the public pensions pages. To claim Indian benefits, the India agreement page lists the Indian forms, such as 10D for old age, and says to return them to a Service Canada Centre or International Operations in Edmonton.
4. Apply for both countries' benefits if you lived in both. The U.S. side uses the interim application ISP-5005-USA when you live in Canada.
5. Expect each country to decide separately and to pay only for the periods it recognizes.

Documents you need

• Passport, SIN and proof of Canadian residence dates.
• Immigration records and Canadian tax slips.
• India: EPFO or EPS membership records and pension payment orders.
• U.S.: Social Security earnings statement and claims correspondence.
• Banking details for direct deposit.

Tax on pensions and reporting

CPP and OAS are reported on T4A(P) and T4A(OAS) slips and taxed as income in Canada. Foreign pensions, including U.S. Social Security, go on line 11500 in Canadian dollars at the Bank of Canada rate on the day received, or the annual average rate if payments were spread through the year; you may deduct part of U.S. Social Security on line 25600. A foreign tax credit may be available on line 40500. A non-resident who receives CPP or OAS can elect under section 217; see our non-resident guide. The CRA publishes Guide T4155 for non-residents who receive OAS and must file an OAS return of income.

Worked example: a Hyderabad immigrant

Lakshmi arrives in Brampton at 45, works 20 years and retires at 65. She has 20 years of Canadian residence after 18, so her OAS would be 20/40, or 50% of the full amount. At the October to December 2026 maximum of $762.50 for ages 65 to 74, that is about $381 a month, though actual amounts are indexed. If she has at least 20 years of Canadian residence she can also keep OAS if she later returns to Hyderabad. Her CPP depends on 20 years of contributions. If she also contributed to the Indian EPS before moving, the agreement may let Canada count those periods to help her meet minimum rules.

If you also file in the U.S. or India

A U.S. citizen or green card holder retiring in Canada receives Canadian pensions and may also draw U.S. Social Security; both countries tax in different ways, and the treaty coordinates some of it. See Canada-U.S. social security totalization, the U.S. Social Security and Medicare guide for foreign workers and cross-border retirement planning for 401(k), RRSP and EPF. For the broader comparison, read payroll and social security compared.

Mistakes to avoid

• Assuming OAS needs contributions. It is based on residence.
• Taking an EPS refund before checking whether the agreement could help your Canadian pension.
• Ignoring the 20-year rule if you plan to retire abroad.
• Failing to file taxes, which can reduce the Guaranteed Income Supplement.
• Forgetting to report foreign pensions in Canadian dollars.

How we can help

We are a U.S. CPA firm in Aurora, Illinois. We cover the U.S. side of cross-border retirement: Social Security interaction, taxation of foreign pensions, and credits, and we coordinate with your Canadian CPA and Indian Chartered Accountant. We do not apply to Service Canada for you. See cross-border tax services and relocation and immigration tax planning. More Canadian guides are on the Canada hub.

Frequently asked questions

General information only. It is not tax, legal, accounting or immigration advice for your situation, and rules change; confirm the current rules with the official source or a licensed professional in the relevant country.