Can Canadians collect their CPP and OAS pensions while living abroad?

Yes. CPP (Canada Pension Plan) is paid to you anywhere in the world for life. OAS (Old Age Security) is also paid abroad if you have at least 20 years of Canadian residency after age 18; if you have less than 20 years, OAS payments stop after 6 months outside Canada. Both are subject to a 25% non-resident withholding tax unless reduced by a tax treaty. Most popular retirement destinations (Mexico, Portugal, Costa Rica, Thailand) have treaties that reduce this to 15%.

Can Australians get the Age Pension while living overseas?

Yes, but with conditions. Australian residents who have lived in Australia for at least 35 years between age 16 and pension age receive the full pension amount overseas, indexed at six-monthly intervals. Those with less than 35 years receive a proportional amount. The Age Pension is generally portable to most countries, but Australia has International Social Security Agreements with about 30 countries that affect how it interacts with foreign pensions.

Which country has the lowest cost of living for retirees?

In 2026, Cambodia, Vietnam, Thailand, Mexico, and Portugal consistently rank lowest for retiree couples. A comfortable middle-class retirement (private healthcare, decent neighbourhood, dining out 3-4x/week) typically runs USD 1,800-3,000/month in Thailand or Mexico, USD 1,500-2,500 in Vietnam, and USD 2,500-4,000 in Portugal. Costa Rica and Panama sit in the middle at USD 2,500-4,000.

Do I have to pay tax in both Canada/Australia and my new country?

Generally no, thanks to double tax agreements. The standard rule: you pay tax where you are resident. If you become a non-resident of Canada or Australia for tax purposes, you generally only pay home-country tax on home-sourced income (rental property, certain pensions). The destination country typically taxes only its own source income or foreign income that is remitted to it. Specifics vary by treaty; get advice for your situation.

Best Countries to Retire from Canada or Australia in 2026 (Cost, Visa, Tax)

Canadians face increasingly unaffordable housing and rising tax burdens. Australians watch the cost of healthcare, electricity, and groceries climb every quarter. Both groups are looking abroad in record numbers. The good news: a Canadian or Australian pension that buys a modest one-bedroom apartment at home buys a comfortable house with a pool in Portugal, Mexico, or Thailand.

This guide ranks the 10 countries that work best for retirees from Canada and Australia in 2026, including the real monthly costs, the visa requirements, and the pension tax treatment most retirement blogs gloss over.

The Three Things Every Retiree Must Sort Out

Pension portability. Will your CPP/OAS or Australian Age Pension still be paid? At what rate? Subject to what withholding tax?
Tax residency. If you formally cease being a Canadian or Australian tax resident, you stop being taxed on worldwide income at home. But departure can trigger deemed-disposition or capital gains events. Plan carefully.
Healthcare. Free at home, often not free abroad. Some destinations have excellent affordable private systems. Others require expensive expat insurance.

The 2026 Ranking

1. Portugal - The European retiree favourite

Monthly cost (couple, comfortable): USD 2,500-4,000
Visa: D7 (passive income visa) for retirees with passive income of at least EUR 870/month per applicant.
Healthcare: Public SNS available after residency; private insurance EUR 50-100/month covers excellent care.
Tax treatment: Standard EU rates apply after residency. The famous NHR regime ended in 2024 but the new IFICI is narrower. Retirees with pension income from Canada or Australia generally pay 10-25% Portuguese tax depending on the pension type.

Why it works: EU residency, eventual EU passport after 5 years, English widely spoken in Lisbon and the Algarve, lifestyle that is hard to beat, and direct flights to Toronto and Montreal in the summer season.

Honest critique: housing in Lisbon and Porto has surged 50%+ since 2020. The Algarve remains better value but is increasingly crowded with British and Canadian retirees.

2. Mexico - The North American classic

Monthly cost (couple): USD 1,800-3,500 depending on city
Visa: Temporary Resident (4 years) with income of ~USD 4,500/month or savings/investments of ~USD 75,000. Permanent Resident with income of ~USD 7,500/month.
Healthcare: IMSS public insurance (~USD 500/year for retirees) covers most needs; private hospitals in major cities are excellent and cost a fraction of US prices.
Tax treatment: Mexico-Canada and Mexico-Australia tax treaties prevent double taxation. CPP and OAS are subject to 25% Canadian withholding, reduced to 15% under treaty. Australian Age Pension is fully portable.

Why it works for Canadians especially: 3-hour flight from Toronto, similar time zones, large established expat communities in Puerto Vallarta, San Miguel de Allende, Merida, and Lake Chapala. Climate options from beach to mountains. Cost of living is roughly half of urban Canada.

Watch out for: security varies enormously by region. Yucatan and Queretaro are among the safest places in North America. Border states and parts of Guerrero are not. Research the specific city, not the country.

3. Thailand - The Asia retirement standard

Monthly cost (couple): USD 1,500-2,800
Visa: Retirement Visa (O-A) requires age 50+, deposit of THB 800,000 (~USD 23,000) in a Thai bank for at least 2 months before application, or monthly income of THB 65,000 (~USD 1,900). The new Long-Term Resident (LTR) visa offers 10-year stays for wealthy retirees with USD 80K+ annual passive income.
Healthcare: Private hospitals in Bangkok and Chiang Mai are excellent and cheap. A comprehensive private insurance plan for a 65-year-old couple runs USD 4,000-7,000/year.
Tax treatment: Thailand only taxes foreign income remitted to Thailand. Pensions kept in offshore accounts and brought in selectively can minimize Thai tax. Treaty with Canada caps withholding; no treaty with Australia means standard Australian non-resident treatment applies.

Why it works: very low cost of living, world-class food, year-round warm weather, large English-speaking expat communities in Chiang Mai, Phuket, Hua Hin. Modern infrastructure in major cities.

Watch out for: visa renewals every year (with the 90-day reporting requirement). Driving culture is challenging. Air quality in Chiang Mai during burning season (Feb-Apr) is among the worst in the world.

4. Costa Rica - The Pensionado classic

Monthly cost (couple): USD 2,500-4,000
Visa: Pensionado visa requires guaranteed pension income of USD 1,000/month per applicant. Rentista requires USD 2,500/month stable income for 2 years or USD 60,000 deposit.
Healthcare: Caja public system is universal and inexpensive for residents (~USD 50-100/month). Private hospitals are good in San Jose.
Tax treatment: Costa Rica taxes only Costa Rica-source income. Foreign pensions, foreign investment income, and foreign rental income are 100% tax-exempt locally. Canadian and Australian tax treatment depends on whether you remain home-country tax resident.

Why it works: stable democracy, no military, excellent climate in the Central Valley, biodiversity, friendly culture. Large North American expat community.

Trade-off: more expensive than people expect. Beach areas (Tamarindo, Nosara) cost as much as cheaper parts of the US. Roads are poor outside major routes.

5. Panama - Best legal/tax structure

Monthly cost (couple): USD 2,000-3,500
Visa: Pensionado visa with USD 1,000/month pension income (only USD 750 if buying property worth USD 100K+). The most generous retiree visa terms in the Americas, with discounts on medical, transport, utilities, and entertainment built into law.
Healthcare: Mixed system. Hospital Punta Pacifica is JCI-accredited (Johns Hopkins affiliate). Private insurance for retirees runs USD 200-400/month.
Tax treatment: Territorial taxation: Panama only taxes Panama-source income. Foreign pensions, dividends, and capital gains are fully tax-exempt locally. Uses the US dollar (no FX risk on USD-denominated pensions).

Why it works: dollar economy, excellent banking infrastructure for the region, easy residency, English widely spoken in Panama City. Cooler highlands (Boquete) for those who want spring-like weather year-round.

Watch out for: Panama City is hot and humid. Outside the capital, infrastructure quality varies. Reputation hit from the Panama Papers still affects banking relationships globally.

6. Spain - For the lifestyle, not the tax savings

Monthly cost (couple): USD 2,500-4,500
Visa: Non-Lucrative Visa for retirees with passive income of ~EUR 2,400/month per applicant, plus health insurance. Path to residency in 5 years, citizenship in 10.
Healthcare: Universal public system available after residency; private insurance EUR 60-150/month for excellent care.
Tax treatment: Spain taxes residents on worldwide income. Pensions taxed as ordinary income (typically 19-47%). The Beckham Law reduces tax to 24% for qualifying foreign workers but does not generally apply to retirees.

Why it works: world-class lifestyle, healthcare, food, cities, beaches. Direct flights to Toronto. Established Anglo expat community in Valencia, Malaga, Alicante.

Trade-off: high taxation makes Spain the worst of the European options for pure tax savings. Choose it because you want to live in Spain, not to save on tax.

7. Malaysia - The cheaper alternative to Thailand

Monthly cost (couple): USD 1,500-2,500
Visa: Malaysia My Second Home (MM2H) program. Recently tightened: requires monthly offshore income of RM 40,000 (~USD 8,500) and a fixed deposit of RM 1M (~USD 215K). The Sarawak version is more accessible (RM 7,000/month income).
Healthcare: Excellent private healthcare in Kuala Lumpur and Penang at 30-40% of Western costs. Insurance for 65-year-old couple ~USD 3,000-5,000/year.
Tax treatment: Malaysia taxes only Malaysia-source income. Foreign pensions and investment income are exempt.

Why it works: English is the second language, modern infrastructure, religiously diverse and stable, excellent food, lower cost than Thailand in many respects, and Penang has one of the best expat retirement scenes in Asia.

Watch out for: the recent MM2H changes made it significantly more expensive and selective. Smaller Anglo community than Thailand. Hot and humid year-round.

8. Vietnam - The frontier value play

Monthly cost (couple): USD 1,200-2,200
Visa: Vietnam has no dedicated retirement visa. Most retirees use 3-month tourist visa runs or business visas with sponsor. New 5-year visa for property owners with USD 250K+ investment is on the table for 2026.
Healthcare: International hospitals in HCMC and Hanoi are good and very affordable. Most retirees still fly to Bangkok or Singapore for serious procedures.
Tax treatment: Vietnam taxes worldwide income for tax residents (183+ days) but enforcement on retiree foreign pensions is light. Many long-term residents structure their stay to avoid hitting the 183-day threshold.

Why it works: extraordinary value. A nice 2-bedroom apartment in District 2 of HCMC rents for USD 700-1,000/month. Coffee culture and street food are world-class. Healthcare in major cities is improving rapidly.

Trade-off: lack of a proper retirement visa makes long-term planning harder. Air quality in HCMC and Hanoi is poor. Language barrier outside major districts.

9. New Zealand - For Australians only

Monthly cost (couple): AUD 3,000-4,500
Visa: Trans-Tasman arrangement: Australian citizens can live, work, and retire in NZ indefinitely without a visa. Access to NZ healthcare after 2 years.
Healthcare: Public system free for residents after 2 years; ACC covers all accidents from day one.
Tax treatment: NZ has no capital gains tax and no estate/inheritance tax. NZ-Australia tax treaty prevents double taxation on pensions. Australian Age Pension is fully portable to NZ.

Why it works for Australians: same language, similar culture, no visa headaches, world-class natural environment, lower house prices than most Australian capitals (outside Auckland and Queenstown).

Trade-off: not really a tax play; rates are similar to Australia. The cost of living is roughly the same. Choose NZ for lifestyle, not for savings.

10. Greece - The undervalued European option

Monthly cost (couple): USD 1,800-3,200
Visa: Financially Independent Person visa requires passive income of EUR 3,500/month plus EUR 1,000 per dependent. Path to permanent residency in 5 years and citizenship in 7.
Healthcare: Public ESY available to residents. Private insurance EUR 60-150/month gives access to excellent private hospitals in Athens and Thessaloniki.
Tax treatment: Greece offers a 7% flat tax for foreign pensioners who establish residency, valid for 15 years. This is one of Europe's most attractive retiree tax regimes and is still active in 2026.

Why it works: still relatively undiscovered compared to Portugal and Spain. EU citizenship path. Beautiful islands and Mediterranean climate. 7% pension flat tax is hard to beat in the EU.

Trade-off: Greek bureaucracy is real. Healthcare quality outside major cities is uneven. Banking can be slow.

The Pension Tax Cheat Sheet

Canadian CPP: 25% non-resident withholding (standard); reduced to 0-15% under most tax treaties.
Canadian OAS: 25% non-resident withholding (standard); reduced to 15% under most treaties. OAS stops after 6 months abroad if you have less than 20 years of Canadian residency.
Canadian RRSP/RRIF: 25% withholding on lump sums and periodic payments; treaties commonly reduce periodic payments to 15%.
Australian Age Pension: Generally portable internationally. Full rate applies for those with 35+ years of Australian residency between age 16 and pension age. Lower thresholds apply for less.
Australian Super: Generally tax-free after age 60 for Australian tax residents. Non-residents may face country-of-residence taxation under the relevant treaty.

The Departure Tax Trap

Canadians who cease tax residency are deemed to have disposed of most non-real-estate assets at fair market value on the date of departure. Unrealized capital gains become realized for Canadian tax purposes. Real estate is excluded but rental property income for Canadians-abroad is subject to 25% withholding (reducible to 15% by election in many cases).

Australians have an equivalent: ceasing to be an Australian tax resident triggers a deemed capital gains event on most non-Australian-real-estate assets (CGT Event I1). The taxpayer can elect to defer this until actual sale, but the election is irrevocable.

Translation: plan the year you leave carefully. Realize losses before departure. Defer or trigger gains based on your individual situation. Talk to a cross-border tax specialist before crossing the border for the last time.

Bottom Line

The single best country depends on three things: the lifestyle you want, the climate you can tolerate, and your monthly pension income. For most Canadian retirees with CAD 3,000-4,500/month after tax, Mexico (Yucatan), Portugal (Algarve), or Panama deliver the best combination of safety, healthcare, expat community, and cost. For Australians with similar income, Malaysia, Thailand, and Portugal lead. For wealthy retirees of either origin, Italy's lump-sum regime, Greece's 7% flat tax, and Singapore's 0% capital gains tax all offer compelling structures.

Compare any two destinations side-by-side using NationsData's country comparison or browse individual country profiles for cost of living, healthcare, and tax data.