Changes to the Canada Pension Plan

Canadians are living longer and healthier lives, and the transition from work to retirement is increasingly diverse.  The Canada Pension Plan (CPP) is adapting to better reflect how Canadians choose to live, work, and retire.  The CPP changes resulted from a review of the CPP that federal, provincial and territorial Finance ministers completed in 2009.  Changes will gradually be introduced from 2011 to 2016.

If you started receiving a CPP pension before December 31, 2010, and you remain out of the work force, you won't be affected.

Starting in 2010, if you are between the ages of 60 and 70 and work while receiving a CPP retirement pension:

  • If you are under age 65 and you work in Canada while receiving your CPP retirement pension, you and your employer will have to make CPP contributions.
  • Between the ages of 65 and 70, you can either choose to make contributions or opt out.  If you choose to make contributions, your employer will also have to contribute.
  • These contributions will increase your CPP retirement benefit through the new Post-Retirement Benefit.

If you are an employee or self-employed person who has contributed to the CPP and are thinking about retirement:                                                                                                                                          

  • Starting in January 2011, your monthly CPP retirement pension will increase by a larger percentage if taken after age 65. 

If you start receiving your monthly CPP retirement pension in January 2012 or later:

  • Your monthly benefit amount will decrease by a larger percentage if taken before age 65.
  • You can take your CPP retirement pension without any work interruption; and
  • A longer period of low or zero earnings may be automatically dropped from the calculation of your pension; this will likely increase your benefit amount.
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