Page 122 - A Canuck's Guide to Financial Literacy 2020

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• have contributed for at least 25 years, including 3 of the last 6 years, and
• and is under the age of 65.

The maximum disability benefit is greater than the maximum retirement benefit ($1335.83
vs $1134.17)

• At age 65, the disability pension is converted to a retirement pension.
• A contributor between ages of 60 and 64 cannot receive both a retirement pension
and a disability pension.

The amount of disability you will receive consists of a flat rate of $485.20 which is fixed for
all recipients plus a 75% of the contributor's retirement pension to a combined maximum of
$1335.83. Keep in mind that the total amount of survivor and disability pension amount
cannot exceed the disability benefit for the year.

Pension of Children of Disabled Contributors

A disabled contributor's child may be eligible to receive a monthly pension of up to 18 years
of age or up to 25 years old if they are enrolled in an approved educational institutional. The
disabled parent must satisfy the minimum contribution requirements discussed above.

• The monthly children's benefit is a flat rate of $250.27 a month.
• It is the same as the orphan's benefit under both the CPP and QPP.

Taxes of CPP Benefits and Contributions

Canada Pension Plan benefits are considered taxable income to the beneficiary.

• Employers
o Employers are able to deduct their contributions on behalf of the employee as
an expense
• Employees
o Contributions by employees result in non refundable federal and provincial
tax credits
• Self Employed
o Self employed individuals are able to claim non refundable federal and
provincial tax credits
o If they have hired employees, they can deduct their contributions as an
expense.