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Changes to CPP

The Canadian Pension Plan is changing to better reflect how Canadians choose to live, work, and retire. What are the changes?

In a nutshell, here’s a list of what’s changing:

  • Your monthly CPP retirement pension amount will increase by a larger percentage if you take it after age 65
  • Your monthly CPP retirement pension amount will decrease by a larger percentage if you take it before age 65
  • If you are under 65 and you work while receiving your CPP retirement pension, you and your employer will need to make CPP contributions. These contributions will increase your CPP retirement benefits.
  • If you are age 65 to 70 and you work while receiving your CPP retirement pension, you can choose to make CPP contributions. These contributions will increase your CPP retirement benefits.
  • The number of years of low or zero earnings that are automatically dropped from the calculation of your CPP pension plan will increase.
  • You will be able to begin receiving your CPP retirement pension without any work interruption.

Will these changes affect you?

The answer is “yes” if:

  • you are an employee who contributes to the CPP, whether you are just starting your career or you are planning to retire soon
  • you are a self employed person who contributes to the CPP
  • you are between the ages of 65-70 and you work while receiving your CPP retirement pension (or if you work outside of Quebec while receiving a QPP retirement pension)

You will not be affected by these changes if you started receiving your CPP retirement pension prior to December 31, 2012, and you remain out of the workforce.

Note for Employers: These changes also affect employers who contribute to the CPP on behalf of their employees.

If you have any questions about the changes to the CPP, don’t hesitate to give me a call. (250) 818-2616

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