Seniors -> CPP retirement pension

Canada Pension Plan (CPP) Retirement Pension

The information below reflects the status of the Canada Pension Plan retirement pension as of 2011.  See our article on the Canada Pension Plan Rules, which discuss old and new rules.  Information below which is affected by the revisions to the CPP rules are marked **.

The CPP retirement pension is considered taxable income.  The amount you receive is not affected by the amount of any other income.

You are eligible for a CPP retirement pension if:

The CPP retirement pension, as mentioned above, can be obtained as early as age 60.  It can also be delayed to age 70.

When early pension is taken before 2012, the pension amount is reduced by 0.5%** for each month that you start your pension before or after you turn 65.  Thus, if you start your pension at age 60, it will be 30%** less than if you start it at age 65.  However, because you will be receiving the pension for an additional 5 years, and you cannot predict how long you will live, it is usually to your advantage to start it as early as possible.

The amount of your CPP pension will depend on how many years you have contributed to the Plan, and how much you have contributed.  

A person's CPP retirement pension is calculated as 25% of his average pensionable earnings during his contributory period.  The contributory period starts when he turns 18, or 1966, whichever is later.  The contributory period ends when he starts collecting the pension.

You can estimate how much your CPP retirement pension will be by referring to your Statement of Contributions, which is sent to you annually.  The table of current monthly average and maximum rates can be found on the Service Canada website.  You can use our CPP Retirement Pension Calculator to compare the pension you would receive at different starting dates.

You should apply for your CPP retirement pension about 6 months before you would like it to start.  You can apply up to a year before you would like it to start.  Service Canada indicates that it takes about 8 weeks to receive your first payment, from the time that they receive your application.

See also our article on the Child Rearing Drop-out Provision, which could increase your CPP retirement pension monthly benefits.

You cannot receive both a CPP retirement pension and a CPP disability benefit at the same time.  If you are under 65, have been receiving a CPP retirement pension for less than 15 months, and you are eligible for the disability benefit, you can request to have your retirement pension replaced by a disability benefit.

See our CPP Retirement Pension Calculator, which provides a comparison of the CPP pension you will receive, based on different starting dates.