Canada Pension Plan Post-Retirement Benefit
The Post-Retirement Benefit (PRB) is a new lifetime benefit that increases your retirement income and rises with increases in the cost of living, even if you already draw the maximum pension from the Canada Pension Plan (CPP) or the Quebec Pension Plan (QPP).
Canadians working outside of Quebec who receive a CPP or QPP retirement pension will begin making CPP contributions toward the PRB on January 1, 2012. The benefit will be paid to you the following year, starting in 2013.
These contributions are mandatory for CPP and QPP retirement pension recipients aged 60 to 65. If you are at least 65 but under 70 years of age, you can choose not to contribute (visit the Canada Revenue Agency Web site for more information).
Note: You cannot make CPP contributions toward the PRB once you reach 70.
Contributions toward the PRB:
- Employees contribute 4.95% of pensionable earnings;
- Employers contribute 4.95%; and
- Self-employed workers contribute both portions for a total of 9.9%.
If you are already receiving your CPP retirement pension, the contributions you make to the CPP will go toward your PRB. These contributions to the PRB will not make you eligible for or increase the amount of other CPP benefits. Your contributions to the PRB are also not subject to credit splitting or pension sharing.
- Find out what benefit payment you can expect to receive from the PRB.
- Learn more about your options and responsibilities for the PRB.
It is important to consider how the Post-Retirement Benefit (PRB) will affect your retirement plans, and see if this increase in income will have any impact on your eligibility or benefit amounts for Old Age Security (OAS), the Guaranteed Income Supplement (GIS), or other provincial or territorial programs. To find out more about these benefits, visit the Retirement Planning page.
What will my benefit payment be?
This table will show you the estimated amount of yearly benefits you could receive from the PRB for a single year of contributions, based on:
- your employment earnings for the year
- your age
Note: This table is intended to provide an estimate only; it may not match your circumstances exactly.
To see the table that is relevant to you, choose your year of birth from the pull-down menu.
What are my options for the Post-Retirement Benefit (PRB)?
As of January 2012
If you are 60 to 65 years of age
Contributions to the CPP are mandatory for those who:
- receive a CPP or QPP retirement pension; and
- earn income in Canada (outside of Quebec).
However, you don’t make contributions if you don’t work while receiving a CPP or QPP retirement pension.
If you are at least 65 but under 70 years of age
If you receive a CPP or QPP retirement pension and work in Canada (outside of Quebec), you can either:
- make contributions, resulting in a PRB; or,
- elect not to contribute (visit the Canada Revenue Agency Web site for more information).
Once you reach 70, you will not make CPP contributions toward the PRB.
When would I receive my Post-Retirement Benefit?
You don’t have to apply. If you made CPP contributions toward a PRB, it will be paid to you automatically the year following your contributions.
How do I stop making CPP contributions?
Starting at age 65, you can elect to stop making contributions. This is done by filling out the form from the Canada Revenue Agency (CRA) and providing it to your employer. For more information on the form or to get a copy, visit the Canada Revenue Agency Web site.
As an employee, what help is available to me?
Check out our online tools and resources to help you understand the CPP changes and how they may affect your retirement plans.
As an employer or a self-employed worker, what should I know?
Changes are about to take effect regarding CPP contributions. Starting January 1, 2012, all workers 65 and under will have to make CPP contributions.
- Workers under age 65 who receive a CPP or QPP retirement pension but who do not currently contribute to the CPP will have to start making CPP contributions.
- Employees and self-employed workers who are at least 65 but under 70 years of age can elect not to contribute. If the employee decides to make the contributions, the employer will also have to contribute.
Visit the Canada Revenue Agency Web site for more information on CPP contribution changes.
- Date modified: