The Canadian Pension Plan (CPP) was created by Canada for senior citizens of the Canada Revenue Agency (CRA) to help them live financially stable and respected lives. There has been a rumour created by many recent reports that suggests that CRA might increase the pension payment in 2025.
CRA New Plan To Increase Pension Payments
The CRA will probably introduce a new plan to increase pension payments and implement it. The Canadian government creates pension plans to guarantee residents’ social security after retirement.
CRA realised that the pension payments have to be changed annually due to the rapid increase in the cost of living and inflation. Goods and services are getting costly and that’s why it is important to increase the payment in the Canada Pension Plan introduced by CRA.
What are the New Plans of CRA?
The CRA includes both Old Age Security (OAS) and the Canada Pension Plan (CPP) to help the senior citizens of Canada financially. The OAS is updated every three months in line with inflation and the CPI. Quarterly adjustments are made to payment methods and income restrictions. However, the modifications are done every year with CPP. Various adjustments are included in CPP, such as adjustments to:
- Payout amounts
- Maximun annual payments
- Maximum annual payments
- Exemption amounts
- Contribute rates
OAS: The benefits you’ll get in Old Age Security (OAS) determine how many years you have stayed as a resident in Canada after turning 18. Due to a 1.3% increase in benefits this year, the maximum monthly OAS payment is not $727.67 for individuals aged 65 to 74 years and $800.44 for those aged 75 and older.
CPP: In 2024-2025, the CPP maximum earnings cap on CPP increased by 14% as well. The amount of pension increased will depend on the contribution amount and duration. The CPP boost for employees with 40 years of contributions will raise the maximum retirement payment by over 50%.
Canada Revenue Agency (CRA) Key Highlights
| Particulars | Details |
| Main Authority | Canada Revenue Agency (CRA) |
| Key Programs |
|
| CRA Pension Eligible Age | 60 years and above |
| Official Website | canada.ca |
CRA Pensions Eligibility Criteria
All individuals receiving CPP or OAS benefits will qualify for increased CRA pensions. The eligibility criteria are specifically based on the retirement plan. Below we have summarised all the basic eligibility rules.
To qualify for benefits, the following criteria must be met:
- The beneficiary must be a low-income Canadian citizen or a permanent resident.
- The applicant must be at least 60 to receive Old Age Security (OAS) and Canada Pension Plan (CPP) benefits. However, the benefits will increase if they are received at age 65.
- The applicant must have contributed to the CPP during their working years to be eligible for CPP payments.
- The applicant must have resided in Canada for a minimum of 10 years and must have filed their tax returns annually.
- These two programs play a major role in helping millions of retirees and the elderly receive the monthly income they require to pay their bills. The CRA is responsible for updating rules and policies related to pension programs, including OAS and CPP.
CRA Pension Increase Amount
For most seniors, the Canada Pension Plan (CPP) and Old Age Security (OAS) are significant sources of income, alongside investments and personal savings. The OAS benefits will increase, and the income limits will adjust accordingly. Additionally, the retirement age has been updated for 2025.
The amount of the CPP pension payout is determined by the worker’s length of service and the contributions made to the CPP. Only employee wages between $3,500 and the yearly earnings limit—which is subject to annual adjustments and will be $71300 for 2025—are eligible for contributions.
Conclusion
In 2005, the Canada Revenue Agency (CRA) implemented several modifications to the Canada Pension Plan (CPP) and Old Age Security (OAS) to help address the financial challenges faced by pensioners. These changes aim to ensure long-term sustainability for the ageing population. For detailed information and confirmation regarding these pension payments, employees can visit the CRA website or www.canada.ca.
We also recommend making consistent contributions to the CPP throughout your working career, as benefits increase with more contributions. You can track your CPP contributions and estimate your payments by using your My Service Canada Account.