US-Canada Totalization Agreement
Published on May 05, 2025
Published by
Reviewed by
Darshana Dhanani,, an IRS Enrolled Agent with 9 years of expat tax experience, specializes in US tax preparation, tax planning, and tax advice for US citizens and Green Card holders living and working abroad.
Table of Contents
How does the US-Canada deal help with Social Security and pensions?
The totalization agreement between the US and Canada helps individuals who have worked in both countries avoid double contributions to Social Security systems. Without it, expats might end up paying into both the US Social Security and Canada’s CPP or QPP for the same job.
This agreement determines which country’s system you pay into and lets you combine work history from both sides to qualify for benefits—something especially helpful for those who haven’t worked long enough in one country alone to meet the minimum requirements.
Who can combine US and Canadian work history to claim benefits?
If you’ve worked in both countries but don’t meet the minimum years required to get retirement benefits in one of them, the agreement may still allow you to qualify.
Here’s how that works:
- For US Social Security: You usually need 10 years of work (40 credits). If you don’t have that, your time contributing to Canada’s CPP can count—so long as you’ve worked at least 1.5 years (6 credits) in the US.
- For Canada’s CPP or QPP: If you don’t meet their minimum contribution thresholds, your US work history can help you become eligible.
- For Canada’s Old Age Security (OAS):
- If you live in Canada: You need at least 10 years of residence after age 18.
- If you live outside Canada: You must have 20 years of Canadian residency after turning 18. Time spent living in the US can sometimes count toward those residency years through this agreement.
What’s the process for applying for benefits through the agreement?
The application process depends on where you live at the time you apply:
- If you’re in the US and want Canadian benefits:
- Complete form CDN-USA 1
- Submit it to your local US Social Security office
- They will forward it to Service Canada for review
- If you’re in Canada and applying for US benefits:
- Fill out form ISP-5005-USA
- Submit it to Service Canada, or mail it to:
- International Operations
Service Canada
PO Box 250
Fredericton, NB E3B 4Z6
Canada
- International Operations
The country that receives the application coordinates with the other side to evaluate your work history and determine eligibility.
Why use the IRS Streamlined Tax Amnesty Program?
It’s for American citizens that didn’t know they had to file US tax returns each year, and have therefore fallen behind. Some more than 30 years! With the IRS Streamlined Procedure, say goodbye to overdue tax returns, late fees, and penalties.
Connect with over 10,000+ expats today!
Embarking on an international journey shouldn’t mean navigating the complex world of US taxation alone. If you’re living and working abroad, our friendly, supportive Expat Tax Online Help Facebook group is here to assist. We’ve designed a community that serves as a comprehensive guide and resource platform tailored for US expats.
Are there any exceptions to the general coverage rules?
Yes, depending on your employment situation, different rules might apply:
- Short-term assignments abroad: If your US employer sends you to Canada for five years or less (or vice versa), you typically continue paying into your home country’s system only.
- Self-employed individuals: Generally, you pay into the system of the country where you live—even if your clients are based in the other country.
- Public-sector jobs: If you work for the government in either country, special rules apply depending on who employs you and where you’re located.
How does the agreement affect Social Security taxes abroad?
The biggest benefit is that it eliminates double taxation. If you’re working in one country, you only contribute to that country’s system—not both.
This means:
- You and your employer won’t have to make two sets of Social Security contributions
- You’ll build eligibility under just one system at a time
- Your contributions will still count toward benefits in both countries through the agreement, if needed
This setup is especially helpful for mobile professionals, remote workers, and employees on international assignments.
Can someone get retirement benefits from both countries?
Yes, as long as you qualify under each country’s rules—either on your own or by combining credits—you can receive separate benefits from both the US and Canada.
- Payments will be issued separately, one from each country
- You’ll only get credit for the time you worked—you won’t be paid twice for the same period
- Each payment is calculated based on the system’s own rules, using your contributions and total credited time
The result is often better than trying to qualify under just one country’s rules, especially for workers who have split their careers across the border.
Spread the word. Please share… 👉
