Take advantage of the agreement between Canada and China

CPP and social security agreements

You are doing business in China

Did you know that Canada has signed a social security agreement with China? It enters into force on January 1, 2017. The agreement eliminates double coverage under the Canada Pension Plan and China’s social security system.

Social security agreements

Canada has more than 50 social security agreements. The main goals of this agreement are to:

  • make sure that the Canada Pension Plan (CPP) coverage for a worker sent to work in China will not be interrupted
  • eliminate cases where workers might have to contribute to the social security system of both countries for the same work

How to eliminate double coverage while not interrupting the CPP for a worker

Employers and their employees and self-employed workers can take advantage of Canada’s agreements with a certificate of coverage from the Canada Revenue Agency (CRA). To apply for a certificate, fill out Form CPT171 and send it to the CRA. To get the form, go to International social security agreement forms.

Generally, the following conditions must be met for receiving a certificate of coverage for an employee sent to work in China:

  • the employer operates in Canada
  • the employer remits CPP contributions and files an information slip (T4) for the employee
  • the employee's work is subject to the CPP before the employee is sent to work in China
  • the employee is required by the employer to work in China
  • the employment in China is temporary and is no longer than 72 months. In some cases, it is possible to lengthen the employment

Self-employed person

A self-employed person must be, under the Income Tax Act of Canada, resident in Canada while a certificate of coverage is being requested. Each country defines self-employment differently. If you have to report your earnings from China as a self-employed income on your Canadian tax return, you likely qualify for a certificate of coverage from Canada, even if you are considered an employee under the laws of China.

There could be others cases where someone qualifies for a certificate of coverage. For more information, call 1-877-598-2408 or 613-670-7439. We accept collect calls.

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