Take advantage of the agreement between Canada and India

CPP and social security agreements

You are doing business in India

Did you know that Canada has signed a social security agreement with India? It enters into force on August 1, 2015. The agreement eliminates double coverage under the Canada Pension Plan and India’s social security system.

Social security agreements

Canada has more than 50 social security agreements. Each agreement coordinates the social security systems of the two countries. Their main goals are to:

  • Eliminate cases where workers might have to contribute to the social security system of both countries for the same work. The agreements make sure that the Canada Pension Plan (CPP) coverage for a worker sent to work in India will not be interrupted. 
  • Co-ordinate the pension benefits of two countries if a person has lived or worked in both. A person who has lived or worked in another country may be eligible for social security benefits from that country, or Canada, or both. For more information on benefits, contact Service Canada.

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 CPT169 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 India:

  • 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 India.
  • The employee is required by the employer to work in India.
  • The employment in India is temporary and is no longer than 60 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 asked. Each country defines self-employment differently. If you have to report your earnings from India 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 India.

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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