Changes to the Canada Pension Plan

Starting in 2019, there will be a gradual enhancement of the Canada Pension Plan (CPP) to increase future retirement, disability and survivor pensions.

How this will affect you:

• Up to 2019, the CPP retirement pension replaces one quarter of average work earnings. In 2019, the CPP will begin to replace one-third of average work earnings.
• From 2019 to 2023, the CPP contribution rate for employees and employers will gradually increase by 1% (from 4.95% to 5.95%) on earnings between $3,500 and the annual maximum limit. The maximum limit used to determine average work earnings will also increase by 14% by 2025.
• In 2019, the CPP contribution rate will be 5.10% for employees and employers and the maximum annual limit will increase to $57,400. You will notice this increase in contributions on your first paycheque in January 2019.
• In 2024, employees and employers will begin contributing 4% each on any additional range of earnings. This range will start at the original annual maximum limit (estimated to be $69,400 in 2025) and go to an additional earnings limit (estimated to be $79,400 in 2025). This additional range will only affect you in years when your annual earnings are above the original earnings limit.

For more information about the CPP enhancements, visit the following Government of Canada links:

• About the Canada Pension Plan Enhancement
• Webinar: Enhanced CPP & You