Nearly all individuals who work inside of Canada are eligible to contribute toward and receive benefits from the Canada Pension Plan, or CPP. The CPP is a deferred income retirement vehicle that has been in place since 1965 when it was introduced as a complement to Old Age Security. Standard benefits are reserved for those who reach the full retirement age of 65, although there are provisions for people between the ages of 60 to 65, those with a chronic disability, and survivor benefits to those who lost someone before they reached retirement age.

CPP benefits are not sent to anyone, even those with eligibility, until an application to receive them is filled out and submitted. If an application is denied, an appeal can be made to the Canada Pension Appeals Board. Those living in Canada but residing in Quebec are not eligible for CPP benefits, since the provincial government of Quebec has opted out of the program. Instead, Quebec offers the Quebec Pension Plan.

Contributions towards the post-retirement benefits of the CPP are mandatory, even for self-employed workers. The level of benefits that you are eligible to receive in retirement varies depending on how much you paid into the system during your working life. Since the contribution rate, as a percentage of income, is fixed, those who earn more money are eligible to receive higher monthly benefits from the CPP. The CPP also provides monthly benefits to the dependent children of disabled or deceased CPP contributors. To qualify for children's benefits, the child must either be under the age of 18 or under the age of 25 while enrolled full-time at a recognized educational institution.

  1. How Does the Canada Pension Plan differ from Social Security?

    The most striking difference between the Canada Pension Plan and Social Security is how sustainable the CPP is versus the ... Read Answer >>
  2. When should I take my Canadian Pension Plan distributions?

    The Canadian Pension Plan (CPP) is a retirement program from which contributing Canadians may receive payments at the age ... Read Answer >>
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