The BPA Financial Group of Companies

Both the Canada Pension Plan “CPP” and the Quebec Pension Plan “QPP” came into effect January 1, 1966. This programme provides a monthly taxable pension to retired contributors. It is designed to replace about 25% of the earnings on which a person's contributions were based. You qualify to receive it if you have contributed to the plan for at least one year.

Your pension

Your CPP normally starts the month after your 65^th birthday regardless of employment status. The pension does not start automatically, you must apply for it. You may commence receiving a pension from age 60, provided you have ceased or substantially ceased employment (for QPP, if you are in phased retirement). A person may defer commencing the pension at age 65, but payments must start at age 70. Your monthly payment is smaller if you begin receiving it before age 65, and larger if you take it after. Pension starting earlier or later than age 65 are adjusted by 0.5% for each month between age 65 and the date in which the pension commences. Increases in the CPP/QPP pension are indexed to the Consumer Price Index (CPI) annually.

Please consult Service Canada for further details or visit their website at Canada Pension Plan

Married or common law spouses who are together and at least 60 years of age, may be able to share the portion of their pension benefits earned during their time together. This may result in a tax savings.

Contributions

Employee contributions to the CPP/QPP are 4.95% of earnings in excess of the basic exemption, up to the Year’s Maximum Pensionable Earnings “YMPE”. Employers are required to contribute 4.95%. Self employed persons are required to contribute twice the employee rate.

CPP Survivor Benefits

Survivors are eligible for benefits provided contributions were made for the lesser of 1/3 the years in the contributory period subject to a minimum of 3 years, or ten years. These monthly benefits are paid to the surviving spouse or common-law partner and/or children of the deceased contributor. The amounts paid will depend on the contributions of the deceased, the age of the spouse or common-law partner, as well as the age of the children. In addition to the survivor pension, benefits payable on death include a lump sum death benefit. The lump sum death benefit under the CPP is limited to six times the pension benefit to a maximum of $2,500. The QPP death benefit is a fixed $2,500.

(1)   Special rules apply when this pension is combined with a disability or a retirement pension

(2)   The pension is reduced by 1/20 times the number of months between the age of the surviving spouse and age 45, no pension is payable before age 35.

Please consult Service Canada for further details or visit their website at CPP Survivor Benefits

Disability Benefits

The Canada Pension Plan (CPP) provides a disability benefit subject to certain eligibilty criteria. The definition of disability is the inability to regulary perform any substantially gainful occupation, and must be long lasting or likely to result in death.

• under 65 years of age
• stopped working because of my medical condition
• CPP: paid into CPP for at least four of the last six years
• QPP: Paid into QPP for at least two of the last 3 years, at least five of the last ten years or for at least half the years (min 2years).

The monthly benefit is payable commencing the fouth month following your disability. People who qualify for disability benefits from other programs may not qualify for the CPP disability benefit.

Please consult Service Canada for further details or visit their website at Canada Pension Plan Disability Benefits

Orphan's Benefits

The monthly benefit is payable to dependent children under the age of 18 or CPP contributors only under the age of 25 if attending school. Also for CPP only, orphans may recieve double benefits if both parents have died and were contributors.

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