CPP Calculator Canada

Your CPP retirement pension is based on the amount and duration of your contributions to the plan. The calculation considers your average pensionable earnings over your contributory period (from age 18 to 65), excludes your lowest-earning years using the general dropout provision (17% of years), and applies the benefit formula to determine what percentage of the maximum pension you qualify for. The maximum monthly CPP retirement pension in 2025 is $1,433.00 for someone starting at age 65 with maximum contributions throughout their career.

You can start receiving CPP as early as age 60, but your pension will be permanently reduced. The reduction is 0.6% for each month before your 65th birthday, which equals 7.2% per year. If you start at age 60, the maximum reduction is 36% (5 years x 7.2%). For example, if your pension at 65 would be $1,000/month, starting at 60 would give you $640/month. This reduction is permanent and does not increase when you turn 65.

Delaying your CPP pension past age 65 increases your monthly payment. The increase is 0.7% for each month you delay, which equals 8.4% per year. The maximum increase is 42% if you delay until age 70 (5 years x 8.4%). For example, if your pension at 65 would be $1,000/month, waiting until 70 would give you $1,420/month. There is no benefit to delaying past age 70, as the pension automatically starts at that point.

CPP2 (the second additional CPP contribution) began in 2024 as part of the CPP enhancement. It applies to earnings between the first earnings ceiling (YMPE, $71,300 in 2025) and the second ceiling (YAMPE, $81,200 in 2025). The CPP2 contribution rate is 4% for employees. CPP2 will gradually increase future retirement benefits for those who contribute. The full enhancement will be available to those who have contributed for at least 40 years under the enhanced system.

To receive the maximum CPP pension, you generally need to have contributed at the maximum level for about 39 years. The contributory period spans from age 18 to 65 (47 years), but the general dropout provision allows you to exclude the lowest 17% of your earnings years (about 8 years). Periods of low or no earnings while raising children under age 7 (child-rearing provision) or receiving CPP disability benefits can also be excluded, helping protect your pension amount.

Yes, self-employed individuals are required to contribute to CPP. However, self-employed workers pay both the employee and employer portions, which means the total rate is 11.9% (2 x 5.95%) on pensionable earnings between $3,500 and $71,300 in 2025. Self-employed individuals also contribute to CPP2 at 8% (2 x 4%) on earnings between $71,300 and $81,200. These contributions are reported on your annual tax return using Schedule 8.