Canada Pension Plan (R.S.C., 1985, c. C-8)

Marginal note:Total pensionable earnings

50 The total pensionable earnings of a contributor are the total for all months in his contributory period of his pensionable earnings for each month calculated as provided in section 51.

Marginal note:Total first additional pensionable earnings

50.1 The total first additional pensionable earnings of a contributor are the total for all months in their first additional contributory period of their first additional pensionable earnings for each month calculated as provided in section 51.

Marginal note:Total second additional pensionable earnings

50.2 The total second additional pensionable earnings of a contributor are the total for all months in their second additional contributory period of their second additional pensionable earnings for each month calculated as provided in section 51.

Marginal note:Pensionable earnings, or first or second additional pensionable earnings, for month

• 51 (1) The pensionable earnings, first additional pensionable earnings or second additional pensionable earnings, as the case may be, of a contributor for a month (in this subsection referred to as the “particular month”) are an amount determined by the formula

  A × B

  where

  A

  is

  • (a) in the case of pensionable earnings, earnings for which the contributor is deemed by section 52 to have made a base contribution for the particular month;

  • (b) in the case of first additional pensionable earnings, earnings for which the contributor is deemed by section 52.1 to have made a first additional contribution for the particular month, except in the case where the contributor is considered to be disabled for the purposes of this Act or a provincial pension plan during the particular month, for the calculation of a pension or benefit other than a disability pension, the greatest of the following amounts:

    • (i) the value determined in accordance with section 51.1 multiplied by the Year’s Maximum Pensionable Earnings for the year that includes the particular month, divided by 12,

    • (ii) the highest of any value determined in accordance with section 51.1 for any of the 72 months before the month in which the contributor was deemed to have become disabled, multiplied by the Year’s Maximum Pensionable Earnings for the year that includes the particular month, divided by 12, and

    • (iii) the earnings for which the contributor is deemed by section 52.1 to have made a first additional contribution for the particular month; or

  • (c) in the case of second additional pensionable earnings, earnings for which the contributor is deemed by section 52.2 to have made a second additional contribution for the particular month except in the case where the contributor is considered to be disabled for the purposes of this Act or a provincial pension plan during the particular month, for the calculation of a pension or benefit other than a disability pension, the greatest of the following amounts:

    • (i) the value determined in accordance with section 51.2 multiplied by the Year’s Maximum Pensionable Earnings for the year that includes the particular month, divided by 12,

    • (ii) the highest of any value determined in accordance with section 51.2 for any of the 72 months before the month in which the contributor was deemed to have become disabled, multiplied by the Year’s Maximum Pensionable Earnings for the year that includes the particular month, divided by 12, and

    • (iii) the earnings for which the contributor is deemed by section 52.2 to have made a second additional contribution for the particular month; and

  B

  is

  • (a) where the contributor was born after December 31, 1932 and the contributor’s retirement pension did not commence before January 1, 1998 and, after the contributor’s 60th birthday, a month was excluded from the contributor’s contributory period by reason of disability, the product determined by the formula

    (C/D) × (E/F)

    where

    C

    is the contributor’s Maximum Pensionable Earnings Average for the year in which a benefit first became payable to the contributor under this Act or a provincial pension plan that caused a month after the contributor’s 60th birthday to be excluded from the contributor’s contributory period by reason of disability,

    D

    is the Year’s Maximum Pensionable Earnings for the year that includes the particular month,

    E

    is the Pension Index for the year in which a benefit becomes payable to the contributor under this Act or a provincial pension plan, and

    F

    is the Pension Index for the year referred to in the description of C, and

  • (b) in any other case, the ratio

    G/D

    where

    G

    is the Maximum Pensionable Earnings Average in respect of the contributor for the year in which a benefit becomes payable to the contributor under this Act or under a provincial pension plan, and

    D

    is as described in paragraph (a).

• Marginal note:First additional pensionable earnings — 2019 to 2022

  (1.1) Despite subsection (1), the first additional pensionable earnings of a contributor for a month are an amount calculated as provided in subsection (1) multiplied

  • (a) for 2019, by 0.15;

  • (b) for 2020, by 0.3;

  • (c) for 2021, by 0.5; and

  • (d) for 2022, by 0.75.

• Marginal note:Exception

  (2) For the purposes of subsection (1), in the case of pensionable earnings, if the year referred to in the description of C is 1987 or earlier, the Maximum Pensionable Earnings Average for the year is calculated as if the Year’s Maximum Pensionable Earnings for a particular year before 1986 were calculated as the greatest multiple of $100 that is equal to or less than an amount calculated by multiplying the Year’s Maximum Pensionable Earnings for 1986, which are $25,800, by the ratio

  A/B

  where

  A

  is the average for the twelve month period ending on June 30 of the year preceding that particular year of the average weekly wages and salaries of the Industrial Composite in Canada as published by Statistics Canada for each month in that period, and

  B

  is the average for the twelve month period ending on June 30, 1985 of the average weekly wages and salaries of the Industrial Composite in Canada as published by Statistics Canada for each month in that period.

• Marginal note:Pension Index before 1974

  (3) For the purposes of subsection (1), in the case of pensionable earnings, if the beginning of a period that is excluded from the contributor’s contributory period by reason of disability is in a year before 1974, in calculating the Pension Index for the year in which that period begins, paragraph 43.1(2)(a) of the Canada Pension Plan, R.S.C. 1970, c. C-5, as amended by section 24 of chapter 4 of the Statutes of Canada, 1974-75-76, is to be read without reference to the words “or 1.02 times the Pension Index for the preceding year, whichever is the lesser”.

Marginal note:Value determined — disabled contributor’s first additional contributory period

• 51.1 (1) For each month that was excluded from the contributor’s contributory period under this Act or under a provincial pension plan by reason of disability, a value shall be determined by the formula

  [[(M1 × A) + (M2 × B) + (M3 × C) + (M4 × D) + (M5 × E) + (M6 × F) + (M7 × G)]/R] × 0.7

  where

  A

  is, in respect of the sixth year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the first additional unadjusted pensionable earnings of the contributor for that sixth year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that sixth year;

  B

  is, in respect of the fifth year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the first additional unadjusted pensionable earnings of the contributor for that fifth year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that fifth year;

  C

  is, in respect of the fourth year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the first additional unadjusted pensionable earnings of the contributor for that fourth year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that fourth year;

  D

  is, in respect of the third year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the first additional unadjusted pensionable earnings of the contributor for that third year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that third year;

  E

  is, in respect of the second year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the first additional unadjusted pensionable earnings of the contributor for that second year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that second year;

  F

  is, in respect of the year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the first additional unadjusted pensionable earnings of the contributor for that prior year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that prior year;

  G

  is, in respect of the year in which they were deemed to have become disabled, the greater of

  • (a) the lesser of 1 and the number determined by the formula

    H/[I × (M7/12)]

    where

    H

    is the first additional unadjusted pensionable earnings for that year, and

    I

    is the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that year;

  M1

  is the lesser of

  • (a) the number of months in the contributor’s first additional contributory period in the sixth year before the year in which they were deemed to have become disabled, and

  • (b) the number of months determined by the formula

    12 − M7

  M2

  is the number of months in the contributor’s first additional contributory period in the fifth year before the year in which they were deemed to have become disabled;

  M3

  is the number of months in the contributor’s first additional contributory period in the fourth year before the year in which they were deemed to have become disabled;

  M4

  is the number of months in the contributor’s first additional contributory period in the third year before the year in which they were deemed to have become disabled;

  M5

  is the number of months in the contributor’s first additional contributory period in the second year before the year in which they were deemed to have become disabled;

  M6

  is the number of months in the contributor’s first additional contributory period in the year before the year in which they were deemed to have become disabled;

  M7

  is the number of months in the contributor’s first additional contributory period in the year in which they were deemed to have become disabled that are before the month following the month in which they were deemed to have become disabled; and

  R

  is the greater of 1 and the number of months determined by the formula

  M1 + M2 + M3 + M4 + M5 + M6 + M7

• Marginal note:Year in which first additional contributory period begins

  (2) For the purposes of the descriptions of A to F in subsection (1), if the contributor’s first additional contributory period begins in the six years before the year in which they were deemed to have become disabled, the Year’s Maximum Pensionable Earnings for the year in which their first additional contributory period begins is replaced by the prorated portion determined by the formula

  A × (M ÷ 12)

  where

  A

  is the Year’s Maximum Pensionable Earnings for the year in which the contributor’s first additional contributory period begins; and

  M

  is the number of months in that year that are included in the contributor’s first additional contributory period.

Marginal note:Value determined — disabled contributor’s second additional contributory period

• 51.2 (1) For each month that was excluded from the contributor’s contributory period under this Act or under a provincial pension plan by reason of disability, a value shall be determined by the formula

  [[(M1 × A) + (M2 × B) + (M3 × C) + (M4 × D) + (M5 × E) + (M6 × F) + (M7 × G)]/R] × 0.7

  where

  A

  is, in respect of the sixth year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the second additional unadjusted pensionable earnings of the contributor for that sixth year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that sixth year;

  B

  is, in respect of the fifth year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the second additional unadjusted pensionable earnings of the contributor for that fifth year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that fifth year;

  C

  is, in respect of the fourth year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the second additional unadjusted pensionable earnings of the contributor for that fourth year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that fourth year;

  D

  is, in respect of the third year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the second additional unadjusted pensionable earnings of the contributor for that third year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that third year;

  E

  is, in respect of the second year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the second additional unadjusted pensionable earnings of the contributor for that second year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that second year;

  F

  is, in respect of the year before the year in which they were deemed to have become disabled, the greater of

  • (a) a ratio calculated by dividing the second additional unadjusted pensionable earnings of the contributor for that prior year by the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that prior year;

  G

  is, in respect of the year in which they were deemed to have become disabled, the greater of

  • (a) the lesser of 1 and the number determined by the formula

    H/[I × (M7/12)]

    where

    H

    is the second additional unadjusted pensionable earnings for that year, and

    I

    is the Year’s Maximum Pensionable Earnings for that year, and

  • (b) any value that was determined in accordance with this section for a month in that year;

  M1

  is the lesser of

  • (a) the number of months in the contributor’s second additional contributory period in the sixth year before the year in which they were deemed to have become disabled, and

  • (b) the number of months determined by the formula

    12 − M7

  M2

  is the number of months in the contributor’s second additional contributory period in the fifth year before the year in which they were deemed to have become disabled;

  M3

  is the number of months in the contributor’s second additional contributory period in the fourth year before the year in which they were deemed to have become disabled;

  M4

  is the number of months in the contributor’s second additional contributory period in the third year before the year in which they were deemed to have become disabled;

  M5

  is the number of months in the contributor’s second additional contributory period in the second year before the year in which they were deemed to have become disabled;

  M6

  is the number of months in the contributor’s second additional contributory period in the year before the year in which they were deemed to have become disabled;

  M7

  is the number of months in the contributor’s second additional contributory period in the year in which they were deemed to have become disabled that are before the month following the month in which they were deemed to have become disabled; and

  R

  is the greater of 1 and the number of months determined by the formula

  M1 + M2 + M3 + M4 + M5 + M6 + M7

• Marginal note:Year in which second additional contributory period begins

  (2) For the purposes of the descriptions of A to F in subsection (1), if the contributor’s second additional contributory period begins in the six years before the year in which they were deemed to have become disabled, the Year’s Maximum Pensionable Earnings for the year in which their second additional contributory period begins is replaced by the prorated portion determined by the formula

  A × (M ÷ 12)

  where

  A

  is the Year’s Maximum Pensionable Earnings for the year in which the contributor’s second additional contributory period begins; and

  M

  is the number of months in that year that are included in the contributor’s second additional contributory period.