CPP (Canada Pension Plan)

What Is the Canada Pension Plan (CPP)?

The Canada Pension Plan (CPP) is a government-run retirement income program that provides monthly payments to eligible Canadians. It's funded by contributions from workers and employers and is designed to replace part of your earnings when you retire or can’t work due to disability or death.

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CPP applies to most people who work in Canada outside of Quebec. (Quebec has its own version called the Québec Pension Plan or QPP.)

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Who Pays into CPP?

If you’re 18 or older, employed or self-employed, and earn more than the basic exemption amount, you contribute to CPP:

• Employees: Contributions are split between you and your employer
  
  
• Self-employed: You pay both the employee and employer portions
  
  

In 2025, the contribution rate is 5.95% of pensionable earnings (up to a yearly maximum).

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What Benefits Does CPP Provide?

CPP offers several types of benefits:

1. Retirement Pension

• Monthly payments starting as early as age 60
  
  
• Full pension available at age 65
  
  
• Can be delayed up to age 70 for larger payments
  
  
• The amount is based on how much and how long you contributed
  
  

2. Post-Retirement Benefits (PRB)

• If you continue working while receiving CPP, you can contribute and earn extra benefits
  
  

3. Disability Benefits

• Monthly payments if you're under 65 and unable to work due to a disability
  
  

4. Survivor’s Pension

• Payments to a surviving spouse or common-law partner after a contributor dies
  
  

5. Death Benefit

• A one-time payment (up to $2,500) to the estate or person responsible for funeral costs
  
  

6. Children’s Benefit

• Monthly payments to children of a deceased or disabled CPP contributor

How Much Will You Get?

CPP retirement payments vary based on:

• Your average earnings during your working years
  
  
• How much you contributed
  
  
• When you start taking payments
  
  

As of 2025, the maximum monthly retirement benefit at age 65 is about $1,364.60, but the average recipient gets closer to $758.

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How to Apply

CPP benefits are not automatic — you must apply:

• Online through your My Service Canada Account
  
  
• Or by completing a paper application and mailing it in
  
  

Apply 6 months before you want to start receiving payments.

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Key Takeaways

• CPP is a key part of retirement income in Canada
  
  
• You must apply to receive benefits — they're not automatic
  
  
• The longer you delay taking CPP (up to age 70), the more you'll receive
  
  
• CPP also includes benefits for disability, death, and surviving spouses

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Common Questions

Q: Can I collect CPP while working?
A: Yes. You can receive CPP retirement payments and continue working. You may also earn additional Post-Retirement Benefits.

Q: Is CPP taxable?
A: Yes. CPP income is considered taxable income.

Q: What happens to CPP when I die?
A: It can provide a survivor’s pension, children’s benefit, and a one-time death benefit to help with final expenses.