As you’re probably aware, the CPP, or Canada Pension Plan, is a program intended to offer an income alternative for retired Canadians. It works a little like this: Canadians make contributions to the program throughout their working years, and then collect benefits from their date of retirement to the end of their life.
Frequently asked questions
Yes. If your spouse or legal common-law partner passes away, you will likely be eligible to collect their CPP payments. The pension is usually paid to the person who was either married to the deceased spouse at the time of death or who was the common-law partner, however, if the deceased does not have a common-law partner the separated spouse may be eligible for their CPP payments. If you are widowed more than one time, you will be eligible for the larger of the CPP payments.
You can apply for CPP benefits as early as age 60 and as late as age 70. The more advantageous option will depend on your particular situation. If you are healthy and have an outlook for a long life, it may make sense to delay your payments as long as possible. If you wait until the age of 70 to collect CPP payments, you will see an increase in your monthly payment.
Good news! Even if you move outside of Canada, you can still collect your CPP. One major difference is that you will see a standard 25% tax deduction on your monthly payments. Unlike the default for CPP payments, this deduction will be made automatically. Important: in order for this deduction to be made, the country that you’re residing in must share a tax treaty with Canada. Countries that share tax treaties with Canada include the United States and the United Kingdom.