Living in Canada

[DavidM]

My wife and I from time to time have thought about moving to Canada, buying a house and retiring there as permanent residents. I was inspired today by a reference by a new member here on TF to the Sunshine Coast of BC north of Vancouver, so I looked up real estate listings there.

We can buy a waterfront smallish house with dock (the TF tiein finally) for 1/2 to 1/8 of US prices for similar properties. Sounds pretty good.

Then I looked at Canadian personal income taxes. Wow!! All of our income is SS, pension and IRA withdrawals which I suspect doesn't get any favorable Canadian treatment. If so, this means our Canadian federal and provincial taxes will be about double our US federal and state income taxes. Double wow!! I had no idea Canadian taxes were so high, particularly provincial taxes.

The NYT had an editorial today and others in the past by Paul Krugman partially justifying the high taxes of Nordic countries whose taxes are also double US. I get it. Those high taxes pay for health care among other important safety net services.

But I am on Medicare now so my health care costs aren't all that high in the US now. I would theoretically save about $5,000 per year in Medicare and Supplemental insurance premiums if I lived in Canada. Same for my wife. But that $10,000 in savings (assuming of course we qualify for permanent residency) would only offset about half of our extra taxes if we lived in Canada.

How are property and sales taxes in Canada. In the US, property tax rates are 1.5-3.0% of market value, the higher end being states with no income tax. Sales taxes average about 7% of taxable items in the US. Also from what I have seen, purchased goods in Canada are higher than the US, but services are probably cheaper so call it a wash on living expenses outside of housing and taxes.

So unless there are lower property and sales taxes in Canada, even with the relatively low cost of waterfront property in BC, I don't think I can make a case for living there.

David

 

[Xsbank]

12% sales tax in BC. It will cost you less here if you are spending US dollars. About 25 cent per dollar. Gas is currently 144.9/litre here.

Why do you want to live here? Saving money, go to upstate New York or Mexico.

 

[Genecop]

Maybe you can still purchase a property and stay part time, if you don’t become a Canadian resident...I’m interested in Nova Scotia myself...

 

[DavidM]

The BC idea is all about quality of life. The Sunshine Coast looks like it has many of the features that appeals to us: beautiful, scenic, water centric at much lower water front property cost than where we are living now- Connecticut summers, Florida winters. The kind of property I can get for US$6-700,000 on the Sunshine Coast is in the millions in both Ct and Fl.

We would have to make it a full time thing. I can't afford three houses!!!!

The sales tax difference is big, but maybe not on a big part of our expenditures. Research so far tells me that property taxes are low, maybe 1/2% of market value. That almost makes up for the Canadian income tax hit.

David

 

[Nomad Willy]

David,
I lived in BC in the early 70’s and liked it very much. I taught HS shop then. Didn’t make much money and I don’t remember what the exchange rate was then. I rented apartments and even boarded a bit.

Lately we’ve been talking about moving to BC but there’s lots of research to be done. Real estate is high here and even higher in BC. It looks to me like overpopulation has filled the good land with human development so real estate will probably remain high.

You’re right though David the BC living is about the quality of life. But what’s real and what’s percieved? Do people crowd in lines less? .. drive cars more politely? One of the main things I like about the Canadian way of life is the openess and continental ways. Not all though. I like the US left way of thinking about immigration in the US but wonder if immigration is a bit like a free-for-all in Canada. But I realize that will hardly affect us if at all. Other than the crowding. Keep in mind that we recently spent 8yrs in Alaska. And now we live 30 miles up a rural river valley. We’re not urban people.

I just recently found all my old papers as a landed immigrant so entry “may” not be difficult. Our geographic thinking is Campbell River .. maybe north or a bit south. We want to spend some time in Starbucks or similar places learning directly from locals. Especially since that comes under the heading of fun. We have made some road trips on the big island.

 

[Xsbank]

BC is not perfect (any more!). I grew up on the coast and I’m suffering from senior’s regret, sad that the place I knew and loved has deteriorated/diminished since I have aged. Socialist provincial government, “no” to any industry not Google, retarded child as Prime Minister (ours is a jerk and gets nothing done while yours is also a jerk but gets stuff done). Shitty transportation, shitty ferries, water rationing on the Sunshine Coast...too many ghettoes full of no-English and too many snowflakes. Now the bad stuff...just kidding.

 

[Jeff F]

I wouldn't assume that you need to pay cdn income tax. Not an expert, but lots of Americans own properties in Canada with no income tax obligations.

 

[Ken E.]

If you like the Sunshine Coast, and I share your opinion of it, you might also want to check out Vancouver Island. Eric mentioned Campbell River. Between there and Nanaimo to the south and Port McNeill to the north is beautiful country. While I'm sure nice real estate there isn't exactly cheap, I bet it's still attractive compared to other coastal areas.

 

[Nomad Willy]

You said it better than me Ken.
That’s exactly the area we have in mind.

Jeff,
Thanks for those words.
We’re running on a small Ameriprise Financial portfolio so won’t be working. Wonder if my dividend income can be sent to a Canadian bank account directly. Or/and under what conditions? Lots to learn.
And I’m old enough to think of moving anywhere as a monumental undertaking.

 

[Jeff F]

I also question David's assessment that income taxes are double in Canada. In general that's not true. Individual cases vary of course.

https://www.investopedia.com/financ...ans-really-pay-more-taxes-than-americans.aspx

 

[Russell Clifton]

So what is the reason so may Canadians have bought property in Washington state? Find a place in BC that you can tie up your boat all summer, spend the summer months fishing, exploring, etc., bring the boat back to Anacortes in the fall and put it in dry storage, get in your motor home and head to Arizona for the winter.

 

[micheln]

I guess since i live on the sunshine coast i can give my two bits. Cant say much about taxes you already found out. but a few key points. Medical care is bad, i mean real bad. Ive gone to the US twice, once for my wife and once for my grand-daughter. Happy to pay you guys to boot. The level of care is an order of magnitude above. Do not give up your medicare you currently have, or budget paying out of pocket to US docs for anything you might need.

Cost of living is sky high. It everything, want a battery charger, same model cnd 863$, US 429$. Same with food, fuel, furniture, on and on. A buck does not go far here, bring many bucks.

Everything mr xsbanks said is accurate.

However, it is Gods country. Ive lived in the US some as well and had to come back as i got home sick. Not for the people as they suck, but for the space. Lots a nd lots of empty space, cant buy that. i would say give it a test run but dont emigrate , you might find seaward just as nice without the negatve.

 

[Bay Pelican]

You also need to talk with a current tax expert as to the double taxation issue. If you retain your American citizenship you remain subject to US income taxes even though you pay Canadian income taxes. You will receive a credit for certain of the Canadian taxes. The details are tricky and must be examine case by case as it is only identical taxes which are credited and what may seem to be an income tax may be a social security contribution (US term).

Don't know how much this changed with the latest tax bill but it was a major problem for American's living abroad and the reason some gave up their citizenship.

 

[ktdtx]

Find a place in BC that you can tie up your boat all summer, spend the summer months fishing, exploring, etc., bring the boat back to Anacortes in the fall and put it in dry storage, get in your motor home and head to Arizona for the winter.

With this scenario why not just skip the buying of property.

 

[Russell Clifton]

With this scenario why not just skip the buying of property.

Exactly.

 

[Airstream345]

Or buy in WA and boat all summer in BC. Maybe you won’t have waterfront with a dock and you’ll have neighbors closer in but you can find view properties north or south of Seattle and especially west (on the Kitsap Peninsula) for those price points.

 

[Seevee]

Interesting, but I could argue STRONGLY to keep your Punta Gorda home and visit Canada for the warm months and make the trek back and forth, having the best of both worlds. And I see very little advantage of becoming a Canadian citizen. You can spend money there just as easy being a US citizen.

For you house comparison of $700k in Cn vs millions in FL, come down and live like the rest of us... you can buy tons of modest, but nice waterfront homes in FL for less than $700k. And for your 3 to 6 months in Canada, rent or find a boat to live on.

Sure Canada is a great place to be, but there's a reason that 98% of them move south for the winter.... it's called COLD! (Well, not 95%, but seems like it).

We have tons of Canadian friends that do the winter/summer thing with homes both in Canada and FL, and do just find. And they escape the brutal winters and instead play on their boat or the golf course in the winter months.

Food for thought.....

 

[DavidM]

Thanks for all of your advice. The Sunshine Coast sounds nice at first, but in fact real estate is just as cheap (or expensive) in Washington State in Bainbridge or Camano Islands or mainland based areas like Paulsboro.


I believe that the quality of life may be better and cruising will be nicer up in the Sunshine Coast and beyond, but look at my avatar to the left to know that I won't be cruising far.


The one advantage might be a nicer, sunnier climate than Washington state, but maybe that is mostly hype.


I have done enough research now to know that it will probably be more expensive to live in Canada: income taxes, cost of goods and sales taxes are the biggest increases, somewhat offset by health care costs and property taxes.


FWIW US citizens with permanent Canadian residency have to pay Canadian income taxes and since they are higher than US taxes there will be no US taxes due.


So, it looks like I will stick with Connecticut and Florida.


David

 

[RT Firefly]

Greetings,
Mr. dj. Mr. S's advice (post #17) is probably the best. Win/win PLUS you won't have to go through the hassle of learning another language...Eh?

 

[Lou_tribal]

The financial aspect may not be the main decision point for going to live somewhere in my sense.
Price/cost/taxes is something but it would be really a pitty to reduce everything to it as there are so many more important things. Quality of life is one, the way you feel somewhere is another etc. If not why not to go to live in 3rd country, it would be far cheaper...
I may look like a dreamer but I prefer to live somewhere I feel good even if it costs me more.

L

 

[DavidM]

I posted my conclusion (post 18) before I read Seevee's advice in post 17 and I mostly agree with him. FWIW an app that I have that gives detailed climate data on anyplace in the US says that that Friday Harbor in the San Juans (a reported pocket of sunnier skies than Seattle) has the same number of sunny days as Punta Gorda. The difference is that PG's sunny days are in the winter when I am there.


Lou also makes a valid point about balancing quality of life against cost. I just don't think that the Canadian PNW balances out right for me.


We live in a gorgeous, almost rural spot in NW Connecticut six mo out of the year and in warm and sunny Florida for the winter months. I can think of nicer places to live and cruise but none nicer in the winter except the keys and I can't afford that.


David

 

[AusCan]

Lou does have a good point. If the tax rate is the major factor in your decision, then you may not not be a good fit for Canada.
There are many ways to measure quality of life and tax rate is a very small part of it. According to the latest world rankings in quality of life, Canada is #1 and the USA is #17. The top 5 countries are all high tax countries.

 

[DavidM]

I can easily believe that Canada is #1 in quality of life and the US is #17. Canada has most of the things we liberals want out of a government, many areas are absolutely gorgeous, and is English speaking and fairly close to home.

But that rating works for the average guy. At 72 years of age, I can afford to live in two of the nicer north/south places in the US. I hoped that the Canadian PNW could give me a better quality of life but the only way to do it and come close to what I have now is to sell both US houses and buy a nice place on the water in Canada.

My judgement is that given my financial situation I would pay more in Canada and not improve my overall quality of life.

David

 

[Lou_tribal]

... and is English speaking ...

David

And French speaking

L

 

[gsholz]

Doesn’t BC now have an additional 20% foreigner tax?

 

[Moonfish]

FWIW an app that I have that gives detailed climate data on anyplace in the US says that that Friday Harbor in the San Juans (a reported pocket of sunnier skies than Seattle) has the same number of sunny days as Punta Gorda. The difference is that PG's sunny days are in the winter when I am there.

I lived in Friday Harbor for many years, and while it's true San Juan Island has more sunny days than Seattle, we used to joke that if the sun came out for even 5 minutes they would count that as a sunny day!

I also heard once that New Mexico has more sunny days during the winter than Florida...

 

[BandB]

BC is beautiful and wonderful but to me quality of life must take into consideration the days of the year it is comfortable to be outdoors and boating. That flips the equation a bit.

As to costs, you're comparing a rather rural area of BC to a prime area of CT or FL. However, there are far less expensive coastal areas from the Chesapeake to NC to SC to GA and even northern FL. Also, W FL, AL, MS, LA.

If not for climate, I would love living in BC, I believe, but based on us liking metropolitan areas we'd choose Vancouver or Victoria and wouldn't save money. In NC, we had about 8 months to enjoy the outdoors. I was use to that plus worked so wasn't so bad. However, once adjusting to 12 months, I'd really hate only having 8 again.

 

[sunchaser]

The BC coastal climate is widely variable. Much more so than WA or OR. But weather variance aside, for boaters used to the nirvana known as the SE US it lacks amenities such as hurricanes, gators, massive population and lightning.

Not to mention the constant icebergs, 15 foot tidal changes, 10 knot currents slowing down an 8 knot boat, rain all the time and blizzards fouling the foredeck. I'd not recommend it for anyone interested in sipping piña coladas and wearing flip flops. BC is mukluks, parkas, toque and Al boat country. Murray needs snowshoes and a shovel to get to his boat. Overall not a place to be.

Now for finishing the planning for my December cruise.

 

[salishpaddler]

Doesn’t BC now have an additional 20% foreigner tax?

If I'm not mistaken, BC has imposed a 20% surcharge on residences purchased by non-citizens, primarily to discourage Asian buyers driving up the market with cash purchases.
https://vancouversun.com/news/local-news/b-c-budget-2018-b-c-ndp-increases-and-extends-housing-taxes-in-effort-to-rein-in-speculation
With that in mind, you'll have no difficulty purchasing a home, and the local and provincial governments will be happy to tax you, but you'll still be classified as a visitor and be required to depart the country every six months or risk deportation.

Regarding healthcare, Medicare is generally worthless in Canada, hence so are Medicare supplements. The primary exception is for emergency medical services required if you are enroute to or from Canada. As a U.S.resident in Canada, count on purchasing commercial health insurance in the Canadian marketplace.

Even with all of that, I continue to give deep thought to relocating, but at age 70, Canadian citizenship is a pipe dream and even obtaining a permanent residency permit is doubtful, though the time may come when US citizens can legitimately claim political asylum. In the meantime, as a disabled military retiree entitled to care in VA and Department of Defense health care systems and as Medicare recipient with TRICARE supplement, I can receive health care virtually anywhere in the US at little out-of-pocket cost. Thus, if I were to actually relocate to Canada, it would be in a location within a day's drive across the border. That still provides a wide variety of possibilities, including often overlooked Port Moody and Coquitlam, an easy Sky Train ride into the heart of Vancouver. Marinas are available in the inlet and Indian Arm, but liveaboard spots may be next to impossible to find.

 

[HiDHo]

We did some rving up the Pacific coast highway and into Canada. At the border our rv was searched, I think for tobacco products, we are non-smokers, no mater. We honestly declared the few ounces of liqour and payed north of $50 duty. So now we enter BC, it is beautiful. First fuel stop diesel $5.25 a gallon after we did the liter conversion, the young lad pumping the diesel gave us a clue, BC stands for “ bring cash ! “ we agreed. On to Calgary blew a trailer tire on the 5th wheel. Stop in Calgary for four tire replacing, check brakes, repack wheel bearings cost $1400. Thanked the tire store manager and headed to Great Falls, Montana for the same tires, brake, and wheel bearing service $650. We also noticed that Candian customs waves through Canadians returning from shopping trips to Walmart with the cars and trucks loaded with groceries. The U S border states Walmarts told us they do many thousands of dollars of business from Canadians coming to there stores to load up on groceries. We loved travelling in Canada but found the idea of having to leave the country to grocery shop terrible. I know the Candian government applies huge taxes to beer, cigarette’s and liqour because it’s bad for your health and the tax money will pay later on for your medical problems. I guess that’s socialism at work but the concept strikes me of to much “ big brother” at work. Just our rving impressions of Living in Canada, for what it’s worth.