In Canada, the Canada Pension Plan (CPP) is a crucial part of your retirement income plan. Whether you’re close to retirement or still some years away, the CPP plays a significant role in your financial security. Many people have questions about when to apply for CPP, the payment dates, and whether CPP payments are taxable. Below is a summary of how the plan works.

What is the Canada Pension Plan (CPP)?

The Canada Pension Plan is a government-administered retirement pension designed to replace income once you retire. The CPP is one part of the Canadian retirement income system, with other components including Old Age Security (OAS), the Guaranteed Income Supplement (GIS), and personal savings. Contributions to the CPP come from workers, employers, and self-employed individuals, and are invested to ensure long-term sustainability.

The CPP is mandatory for all workers across Canada, except in Quebec, where the Quebec Pension Plan (QPP) operates. It’s important to note that the CPP is not funded by the government but by contributions from Canadian workers and employers.

CPP Payment Dates for 2025

Here are the scheduled dates for CPP payments in 2025:

• January 29, 2025

• February 26, 2025

• March 27, 2025

• April 28, 2025

• May 28, 2025

• June 26, 2025

• July 29, 2025

• August 27, 2025

• September 25, 2025

• October 29, 2025

• November 26, 2025

• December 22, 2025

How is CPP Funded?

Unlike OAS and GIS, the CPP is funded through contributions from both employees and employers, as well as self-employed individuals. These contributions are deducted from paychecks and invested, with the returns reinvested into the program. For self-employed individuals, the CPP contributions are added to their tax bill.

In January 2024, CPP contribution rates were increased as part of a long-term initiative to enhance retirement income, set to continue through 2026.

Who Manages the CPP Investment Portfolio?

The CPP’s investments are managed by CPP Investments, a Crown corporation operating independently from the government. The plan is regularly reviewed by the Office of the Chief Actuary of Canada to ensure it remains financially sustainable. According to the latest reports, the CPP is projected to be sustainable for at least the next 75 years.

Am I Eligible for CPP?

If you are at least 60 years old and have made at least one contribution to the CPP, you are eligible to start receiving CPP payments. You can also qualify if you’ve received CPP credits from a former spouse or partner who contributed to the plan. CPP benefits are available to Canadian citizens, permanent residents, legal residents, and landed immigrants.

Should I Apply for CPP or QPP?

If you’ve contributed to both the CPP and the Quebec Pension Plan (QPP), your place of residence at the time of your application will determine which plan you apply to. If you live in Quebec, you apply for the QPP; otherwise, you apply for the CPP.

When Can I Start Receiving My CPP?

You can begin receiving your CPP retirement benefits at any age between 60 and 70. However, the earlier you start, the smaller your monthly payments will be. Many Canadians opt to start their CPP at age 65 for the standard monthly payout.

How Long Will I Receive CPP Benefits?

Once you begin receiving CPP, you will continue to receive monthly payments for the rest of your life. Additionally, if you become disabled or pass away, the CPP offers income replacement for your family, including a one-time death benefit, a monthly survivor’s pension, and benefits for dependent children under the age of 25.

How Much Will My Monthly CPP Payments Be?

Your monthly CPP pension amount is determined by three main factors:

• The age at which you start receiving your benefits

• The number of years and how much you’ve contributed to the CPP

• Your average annual income during your working years

Generally, the longer you contribute and the later you start receiving your pension, the higher your monthly benefit. In 2025, the maximum monthly amount you can receive if you start your pension at 65 is $1,433. The average monthly pension for a new retiree at age 65 in October 2024 was $808.14. If you have a disability or are a surviving spouse of a deceased contributor, you may be eligible for additional benefits.

How to Apply for CPP Benefits

To apply for your CPP benefits, you can do so online through your My Service Canada Account or by downloading the paper application form. Keep in mind that it may take up to 120 days to process your application and determine your benefits. Once approved, your payments will be deposited directly into your bank account if you choose direct deposit, or you’ll receive cheques in the mail, usually within the last three business days of each month.

Are CPP Payments Taxable?

Yes, CPP payments are taxable. You can request the Canada Revenue Agency (CRA) to withhold federal income tax from your monthly payments through your My Service Canada Account or by submitting a request form. If you don’t choose to have taxes deducted, you may need to pay income tax quarterly.

This guide provides you with a complete overview of the CPP system and the dates to expect your payments in 2025. If you have more specific questions or want to calculate your expected contributions, visit the Government of Canada’s official website or access your My Service Canada Account.