Updated: April 2025  |  bremo.io financial guides

CPP Retirement Pension Canada 2025 — How Much Will You Get?

The Canada Pension Plan (CPP) retirement pension is one of the most important sources of retirement income for Canadians. If you've worked in Canada and made contributions, you're likely entitled to receive CPP payments when you retire. But how much will you actually get — and when should you start taking it?

What Is the CPP Retirement Pension?

The CPP retirement pension is a monthly, taxable benefit that replaces part of your income when you retire. The amount you receive depends on how much you contributed during your working years and for how long. It is not a flat amount — it's based on your personal contribution history.

CPP is funded through contributions made by employees, employers, and self-employed individuals throughout their working careers. The contributions are a percentage of your earnings between the basic exemption ($3,500/year) and the maximum pensionable earnings ($68,500 in 2024).

How Much Can You Receive from CPP in 2025?

For 2024, the maximum CPP retirement pension at age 65 is $1,364.60 per month. However, the average new CPP retirement pension is significantly lower — around $816 per month — because most Canadians don't contribute the maximum every year throughout their entire career.

How Is Your CPP Amount Calculated?

Service Canada uses a formula that takes into account your total pensionable earnings over your working life, adjusted for inflation. The more years you contributed and the higher your earnings (up to the maximum), the larger your benefit.

There is also a "drop-out" provision that allows your lowest-earning years to be excluded from the calculation. Specifically, up to 8 years of low- or zero-income years can be dropped, including years spent raising children under age 7 (the child-rearing provision) and years of disability.

When Should You Start CPP?

You can start your CPP retirement pension as early as age 60 or as late as age 70. The standard start date is age 65. Starting early means reduced payments; starting late means enhanced payments.

• Before 65: Benefit is reduced by 0.6% for each month before your 65th birthday (7.2% per year), up to a maximum reduction of 36% if you start at 60.
• After 65: Benefit increases by 0.7% for each month after your 65th birthday (8.4% per year), up to a maximum increase of 42% if you start at 70.

CPP Enhancement (CPP2)

Starting in 2019, CPP underwent an enhancement. Workers who began contributing after 2019 are paying into an expanded program that will provide a larger replacement rate — up to 33.33% of earnings (up from 25%). This enhancement is being phased in gradually and will benefit younger workers the most. By 2065, the full enhancement will be in effect.

How to Apply for CPP

You must apply for your CPP retirement pension — it is not paid automatically. You can apply online through My Service Canada Account, by phone, or by mail. Service Canada recommends applying 6 months before you want your payments to start.

You can check your CPP Statement of Contributions through My Service Canada to see your contribution history and an estimate of your future benefit.

CPP and Other Income

CPP retirement pension is taxable income. It is included in your total income for the year and taxed at your marginal rate. However, you can have federal and provincial income tax withheld at source, which can simplify tax filing. You may also be eligible for the pension income tax credit on CPP income.

CPP If You're Still Working

If you're between 60 and 70 and still working while receiving CPP, you can continue to make CPP contributions. These contributions earn you Post-Retirement Benefits (PRB), which permanently increase your monthly pension. PRB contributions are mandatory if you're under 65 and receiving CPP while working; they become optional at ages 65–70.

What Happens to CPP When You Die?

CPP offers survivor benefits. If you die, your estate receives a one-time death benefit of up to $2,500. Your surviving spouse or common-law partner may receive a monthly survivor's pension. Any dependent children may also receive a monthly children's benefit.

Tips to Maximize Your CPP

• Contribute consistently and maximize your earnings up to the annual limit throughout your career.
• Consider delaying to age 70 if you expect a long retirement — you'll receive 42% more per month.
• Use the child-rearing provision if you had children under 7 to exclude those low-income years.
• Apply 6 months before your desired start date to avoid delays.
• Review your Statement of Contributions annually via My Service Canada.