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Posted on October 15th, 2024 in Domestic Tax, Financial Planning & Wealth Management
Several changes have been introduced to targeted measures and benefits under the Canada Pension Plan (CPP). None of the below changes are expected to impact contribution rates.
The CPP death benefit is increased to $5,000 (from $2,500) where all of the following criteria are met:
The increased benefit applies to deaths after December 31, 2024.
Prior to the change, the CPP surviving child benefit was only payable to children of a deceased parent if the child was under 18 or between the ages of 18 and 25 and was a fulltime student. While this benefit is still available, a similar benefit has now been introduced for part-time students, equal to 50% of the amount payable to full-time students.
In addition, eligibility for the disabled contributor’s child benefit is extended such that it continues to be available even when the disabled parent reaches age 65. Previously, the benefit ended when the disabled parent reached age 65.
Previously, couples who were legally separated but still married or in a common-law relationship could be eligible for CPP survivor pension on their partner’s passing. However, after this change, the survivor pension is not payable after a legal separation where there has been a division of their CPP pensionable earnings following the separation.
Ensure you apply for these enhanced benefits if you are eligible.
Article originally published in: Tax Tips & Traps 2024 Third Quarter – Issue 147.
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