The Canada Pension Plan (CPP) is one of the three main sources of retirement income for seniors in Canada.
CPP payments are made monthly and paid out through direct deposit to your bank or sent as a cheque. The payment schedule varies monthly but is generally on the third to last business day of each month.
CPP payment dates also coincide with when Old Age Security (OAS) pension benefits are paid out. You can read more about OAS vs CPP.
In Quebec, the CPP-style program is known as the Quebec Pension Plan.
CPP Payment Dates for 2023
The Canada pension payment dates in 2023 (CPP payment dates) are:
- January 27, 2023
- February 24, 2023
- March 29, 2023
- April 26, 2023
- May 29, 2023
- June 28, 2023
- July 27, 2023
- August 29, 2023
- September 27, 2023
- October 27, 2023
- November 28, 2023
- December 20, 2023
CPP payments include the CPP retirement pension, CPP disability, children’s benefits, and survivor’s benefits.
OAS benefits are made out on the same dates and include the OAS pension, Guaranteed Income Supplement (GIS), Allowance, and Allowance for the Survivor.
December payments are generally scheduled before December 25.
What is the Canada Pension Plan?
The Canada Pension Plan (CPP) is a retirement pension plan that pays monthly taxable benefits to eligible seniors. In Quebec, it is called the Quebec Pension Plan (QPP).
It works using a contributory system, which means you must have contributed to the plan during your working years to benefit.
The earliest age to collect CPP is 60; however, the standard retirement age for full benefits is 65. You can also delay CPP payments until age 70 for higher payouts.
The CPP Investment Board, a federal Crown corporation, manages the CPP.
How Much CPP Will I Get?
You may wonder how much CPP to expect and why your payments are what they are.
The amount of CPP you get is based on your contributions to the plan. The more you contribute (and the longer you contribute), the more CPP you will qualify for in retirement.
Generally, to receive CPP, you must be at least 60 years old and have made at least one contribution to the plan. Most people will not qualify for the maximum CPP because they did not make the maximum contributions to the plan…for at least 39 years, that is.
Here’s a snapshot of the average and maximum CPP payments for 2023:
|Type of pension or benefit||Average amount for new beneficiaries||Maximum monthly payment amount (2023)|
|Retirement pension (at age 65)||$717.15||$1,306.57|
|Post-retirement benefit(at age 65)||$9.53||$40.25|
|Post-retirement disability benefit||$524.64||$558.74|
|Survivor’s pension – younger than 65||$480.52||$707.95|
|Survivor’s pension – 65 and older||$313.59||$783.94|
|Children of disabled CPP contributors||$264.53||$281.72|
|Children of deceased CPP contributors||$264.53||$281.72|
|Death benefit (one-time payment)||$2,499.44||$2,500.00|
|Combined survivor’s and retirement pension (at age 65)||$914.53||$1,313.13|
|Combined survivor’s pension and disability benefit||$1,158.95||$1,542.77|
As you can see, the average CPP retirement pension benefit is $717.15, which is just over 58% of the maximum CPP amount of $1,306.57.
Who Gets the Maximum CPP Benefit?
The maximum monthly CPP benefit in 2023 is $1,306.57 per month or $15,678.84 per year. To receive the maximum CPP, you must have:
- Contributed to the CPP for at least 39 years of the 47 years from age 18 to 65.
- Contributed the maximum amount to the CPP for at least 39 years based on the Yearly Maximum Pensionable Earnings (YMPE).
The YMPE is the amount used to calculate the maximum contribution to the CPP/QPP each year.
For example, for 2023, the YMPE is $66,600, up from $64,900 in 2022.
This means that for 2023, you do not make any additional CPP contributions after reaching $66,600 in income for the year.
Maximum CPP Contribution for 2023
- YMPE = $66,600
- Basic exemption: $3,500
- CPP contribution rate (employee): 5.95%
- maximum contributory earnings: $63,100 (i.e. $66,600 minus $3,500)
- Maximum annual employee contributions in 2023: $3,754.45
The YMPE over the years are:
- 2023: $66,600
- 2022: $64,900
- 2021: $61,600
- 2020: $58,700
- 2019: $57,400
- 2018: $55,900
- 2017: $55,300
- 2016: $54,900
For the YMPE numbers all the way to 1966 (when the amount was $5,000), check here. The basic exemption amount has been $3,500 since 1996.
Assuming you earned and contributed CPP on an income that’s about 80% of the YMPE throughout your working years and you made CPP contributions for at least 39 years, it’s safe to say that you can expect to receive around 80% of the maximum CPP amount.
Provisions like child-rearing, low-income earning years drop-out, and disability drop-in/drop-out may increase your benefits.
Related: How to get the maximum CPP.
Is the CPP Taxable?
Yes, CPP payments are considered taxable income. The tax rate is based on your overall taxable income level. At the Federal level, the following income tax rate applies:
- Up to $53,359: 15%
- $53,360 to $106,717: 20.50%
- $106,718 to $165,430: 26%
- $165,431 to $235,675: 29%
- $235,676 and over: 33%
Couples may choose to share their CPP benefits for tax-saving purposes. You must apply to Service Canada to share your pension, and you can cancel anytime.
The amount of CPP you receive is not income-tested like the OAS, and there is no clawback of CPP even if your income exceeds the OAS maximum income threshold (i.e. $129,757 for 2023).
CPP Increases in 2023
Changes were made to the CPP starting in 2019. While the CPP was initially designed to replace 25% of pre-retirement income, the long-term plan is to have the program replace 33.33% of your average lifetime earnings.
The full impacts of these changes are not expected to be realized until 2065.
A few things to note:
CPP contribution rates are increasing. For 2022, the employee/employer contribution rates increased from 5.45% to 5.70% (total of 11.40%) of earnings up to the YMPE. It increases to 5.95% (11.90% total) in 2023.
|Year||Employee contribution rate||Employer contribution rate||Self-employed contribution rate|
|2023 and later||5.95%||5.95%||11.90%|
Additional contributions will be phased in starting in 2024 at 4% of earnings above the YMPE up to a maximum amount.
For example, in 2024, you will contribute an additional 4% (8% total – 4% employer/4% employee) on income earned between the YMPE and $61,400 in 2019 dollars.
Overall, seniors will receive a higher CPP from now on, and the full impact of the increased CPP will be felt about 4.5 decades from now.
Additional CPP Benefits
In addition to the retirement pension, CPP beneficiaries and their spouse or dependents may also qualify for:
1. Post-Retirement Pension
While collecting CPP, you can continue to work and make CPP contributions. These additional contributions are paid out as a post-retirement benefit and increase your overall pension.
You can no longer make a CPP contribution after age 70. CPP contributions are voluntary between the age of 65 to 70.
2. CPP Survivor’s Pension
This benefit is paid out to the legal spouse or common-law partner of a deceased CPP contributor.
The total CPP benefit that can be received (i.e. retirement pension, disability pension, and survivor’s pension) cannot exceed the maximum CPP retirement or disability pension.
The current maximum CPP survivor’s pension is $707.95 (under 65 years) and $783.94 (65 years and older). The average monthly amounts are $480.52 and $313.59, respectively.
3. CPP Disability Pension
CPP contributors with a “severe and prolonged” disability may qualify for the CPP disability pension and post-retirement disability benefit.
Their dependent children may also qualify for a children’s benefit.
The current maximum CPP disability pension is $1,538.67, while the average monthly payment is $1,078.07.
4. CPP Death Benefit
A lump-sum benefit of $2,500 is paid out to the estate of a deceased CPP contributor. To apply, you must complete Form ISP1200 and mail it to Service Canada.
5. CPP Children’s Benefit
Monthly benefits are available to dependent children of a deceased or disabled CPP pensioner. The child must be under the age of 18 or under 25 if in school full-time.
The maximum monthly children’s benefit for 2023 is $264.53.
What Happens To CPP After Death?
After a CPP pensioner dies, their spouse may be eligible for additional benefits, i.e. the survivor’s benefit as explained above, and children under age 25 could also receive a children’s benefit.
The survivor’s pension varies depending on how much the deceased contributor made to the plan, as well as the age of the living spouse.
If the spouse is under 65 years old, they get 37.5% of the retirement pension of the deceased contributor plus a flat-rate amount. If the spouse is 65 years and older, they receive 60% of the deceased contributor’s retirement pension.
The living spouse or common-law partner can only receive a total combined pension benefit up to the maximum retirement pension ($1,306.57 in 2023).
So, if you already receive the full CPP, your survivor’s benefit falls to zero.
The deceased contributor’s estate may also be eligible for a death benefit of $2,500 to help with funeral expenses.
If a CPP pensioner dies before they can apply for the CPP, the following applies:
- Their estate can submit an application to receive up to 12 months of retirement pension. This is only possible if they were over 70 and the application was submitted within 12 months of death.
- Their estate, spouse, or next of kin can still apply for the death benefit.
- Their spouse and children can still apply for the survivor’s pension and children’s benefits.
What Happens To CPP If You Move Abroad?
CPP payments are not subject to the 20-year residency requirements that apply to Old Age Security. Regardless of where you live abroad, you can receive your CPP pension.
Payments are either made in the local currency or in Canadian dollars.
If you are deemed by CRA to be a non-resident of Canada for tax purposes, a 25% withholding tax rate applies to your benefits.
If you live in a country with a tax treaty with Canada, the tax withheld may be reduced or waived altogether (e.g. if you live in the U.S.).
What is the Best Age to Collect CPP?
Should I collect CPP at age 60? There are no hard and fast rules for when to start collecting CPP payments.
Some factors to consider are:
- Do you need the money now?
- Your expected lifespan
- Current income levels and plans to continue working
- OAS clawback considerations
The longer you wait to collect, the more pension you receive. However, waiting beyond age 60 is not always a better decision. I would advise you to discuss your overall financial situation with a financial planner to determine what’s best for you.
Canada Pension Plan FAQ
Here are some popular CPP questions and answers:
Will CPP benefits increase in 2023?
Yes, CPP benefits have increased for 2023 based on changes to the Consumer Price Index. The maximum monthly CPP benefit increased from $1,253.59 to $1,306.57.
What is the maximum CPP for 2023?
The maximum monthly CPP is $1,306.57. This makes for an annual pension of $15,678.84. The maximum monthly CPP in 2022 was $1,253.59.
The maximum monthly CPP disability amount in 2023 is $1,538.67, for an annual maximum pension amount of $18,464.04.
Should I collect CPP while working?
The standard age to start collecting CPP is 65. You can opt for an early CPP starting at 60 years of age. In this case, your benefits are decreased by 0.60% each month (7.2% penalty per year).
Alternatively, you can delay CPP till age 70 and receive an increase of 0.70% per month (8.4% increase per year).
If you started contributing to the CPP later in life or simply want to increase your retirement benefits, working and contributing to the CPP after 65 may make sense. However, contributions to the CPP are not required after you turn 65.
What are the CPP disability payment dates in 2023?
CPP disability is paid on the same dates as the CPP retirement pension. The CPP disability dates for 2023 are on January 27, February 24, March 29, April 26, May 29, June 28, July 27, August 29, September 27, October 27, November 28, and December 20, 2023.
How much can I earn while on CPP disability in 2023?
You can earn up to $6,600 before taxes without losing your disability benefits. You should contact CPP when your annual income reaches this amount as you could lose some of your benefits.
Does CPP pay for funeral expenses?
If the CPP pensioner made eligible contributions, their estate (or spouse/next-of-kin/estate executor) may be eligible for a $2,500 death benefit.
Can I collect my deceased husband’s CPP?
A surviving spouse can apply for a survivor’s pension. The amount you receive will depend on how much was contributed to the plan, your age, and the other pension benefits you are already receiving.
Is the CPP survivor benefit increasing?
Yes, the maximum CPP survivor pension amount for those under 65 increased to $707.95 in 2023, while it increased to $783.94 for those over age 65.
What date does the Old Age Security (OAS) get deposited?
OAS benefit payments are made on the last business day of each month. The OAS payment dates in 2023 are January 27, February 24, March 29, April 26, May 29, June 28, July 27, August 29, September 27, October 27, November 28, and December 20, 2023.
What are the GIS payment dates in 2023?
OGIS benefit payments are made on the last business day of each month, which is the same day you receive the OAS pension.
What should I do if my CPP payment is not received?
If your CPP payment is late, you should contact Service Canada toll-free at 1-800-277-9914 to inquire about its status. If you haven’t set up direct deposits, it may take a few days to receive your CPP cheque.
Also, if you have just applied for the CPP, the processing time is anywhere from 7 days to 120 days.
Should I collect CPP early at 60 or delay it until age 70?
There are many factors you should consider when deciding on whether to take CPP early or delay it until later, including your other income, OAS clawback, your expected lifespan, and more.
Delaying your OAS until later can lead to increased payments of up to 42%, while collecting CPP early can decrease your monthly payment by up to 36%.
Can I cancel CPP after starting?
Yes, you can cancel your CPP pension up to 12 months after you begin receiving it. To cancel your CPP, you must send a request in writing to Service Canada and repay all the benefits you have already received.
When are CPP cheques sent?
Your CPP cheque is mailed to you during the last 3 business days of each month. As such, you may receive it by the general payment date or shortly after.
If you have questions about CPP payments and amounts, leave them in the comments.
Did CPP benefits increase in 2022?
Yes, CPP amounts increased in 2022. CPP benefits are adjusted every January to account for the inflation rate (i.e. Consumer Price Index). And in 2022, the amount increased by 2.4%.
In addition, CPP pensioners started to see increases in their payments starting in 2019 due to changes announced in the 2016 Federal Budget. The full impact of the CPP enhancement won’t be realized until 2065.