An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board Act and the Income Tax Act (S.C. 2016, c. 14)
Full Document:
Assented to 2016-12-15
PART 1Amendments to the Canada Pension Plan and the Canada Pension Plan Investment Board Act (continued)
R.S., c. C-8Canada Pension Plan (continued)
Marginal note:R.S., c. 30 (2nd Supp.), s. 15
21 (1) Subsection 46(1) of the Act is replaced by the following:
Marginal note:Amount of retirement pension
46 (1) Subject to this section, a retirement pension payable to a contributor is a basic monthly amount equal to the aggregate of
(a) 25% of their average monthly pensionable earnings,
(b) 8.33% of their first additional monthly pensionable earnings, and
(c) 33.33% of their second additional monthly pensionable earnings.
Marginal note:R.S., c. 30 (2nd Supp.), s. 15
(2) The portion of subsection 46(2) of the Act before paragraph (b) is replaced by the following:
Marginal note:Special case
(2) Subject to this section, the portion referred to in paragraph (1)(a) of the basic monthly amount of a retirement pension payable to a former disability pension recipient in respect of whom a division under section 55 or 55.1 is approved either before or after the commencement of the retirement pension, if the division reduces the retirement pension otherwise payable, is calculated by dividing
(a) the aggregate of
(i) the portion of the basic monthly amount of the retirement pension calculated in accordance with paragraph (1)(a) that would be payable to the contributor had their base unadjusted pensionable earnings not been subject to the division, multiplied by the number of months that have been excluded from the contributor’s contributory period by reason of disability, and
(ii) the portion of the basic monthly amount of the retirement pension calculated in accordance with paragraph (1)(a) that would be payable following the division, multiplied by the number of months in the contributor’s contributory period calculated in accordance with section 49
by
22 The Act is amended by adding the following after section 48:
Marginal note:First additional monthly pensionable earnings
48.1 The first additional monthly pensionable earnings of a contributor are an amount calculated by
(a) in the case where their first additional contributory period is less than or equal to 480 months, dividing their total first additional pensionable earnings by 480; or
(b) in the case where their first additional contributory period exceeds 480 months, dividing the aggregate of their 480 highest first additional pensionable earnings for a month by 480.
Marginal note:Second additional monthly pensionable earnings
48.2 The second additional monthly pensionable earnings of a contributor are an amount calculated by
(a) in the case where their second additional contributory period is less than or equal to 480 months, dividing their total second additional pensionable earnings by 480; or
(b) in the case where their second additional contributory period exceeds 480 months, dividing the aggregate of their 480 highest second additional pensionable earnings for a month by 480.
Marginal note:R.S., c. 30 (2nd Supp.), s. 17
23 Paragraph 49(d) of the Act is replaced by the following:
(d) in relation to any benefits payable under this Act for any month after December, 1977, any month for which the contributor was a family allowance recipient in a year for which the contributor’s base unadjusted pensionable earnings were equal to or less than the contributor’s basic exemption for the year.
24 The Act is amended by adding the following after section 49:
Marginal note:First additional contributory period
49.1 The first additional contributory period of a contributor is the period commencing January 1, 2019 or when they reach 18 years of age, whichever is the later, and ending with the earliest of
(a) the month preceding the month in which they reach 70 years of age,
(b) the month in which they die, and
(c) the month preceding the month in which the retirement pension commences.
Marginal note:Second additional contributory period
49.2 The second additional contributory period of a contributor is the period commencing January 1, 2024 or when they reach 18 years of age, whichever is the later, and ending with the earliest of
(a) the month preceding the month in which they reach 70 years of age,
(b) the month in which they die, and
(c) the month preceding the month in which the retirement pension commences.
25 The Act is amended by adding the following after section 50:
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:1997, c. 40, s. 71
26 (1) The portion of subsection 51(1) of the Act before the formula is replaced by the following:
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
Marginal note:1997, c. 40, s. 71
(2) The description of A in subsection 51(1) of the Act is replaced by the following:
- 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; 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; and
(3) Section 51 of the Act is amended by adding the following after subsection (1):
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:1997, c. 40, s. 71
(4) The portion of subsection 51(2) of the Act before the formula is replaced by the following:
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
Marginal note:1997, c. 40, s. 71
(5) Subsection 51(3) of the Act is replaced by the following:
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:R.S., c. 30 (2nd Supp.), s. 19
27 Section 52 of the Act is replaced by the following:
Marginal note:Earnings for which base contribution deemed to have been made for month
52 (1) For the purpose of calculating the pensionable earnings of a contributor for a month in any year for which they have made a base contribution, the base contribution is deemed to have been made for all months in the year, and the earnings for which the contributor is deemed to have made that contribution for each month in the year are an amount calculated by dividing their base unadjusted pensionable earnings for the year by 12, except that
(a) for a year in which the contributor reaches 18 years of age or in which a disability pension ceases to be payable to them under this Act or under a provincial pension plan, the base contribution is deemed to have been made for earnings for the months in the year after they reached that age or after the pension ceased to be payable, as the case may be, and
(b) for a year in which the contributor reaches 70 years of age or dies, in which a retirement pension becomes payable to them under this Act or under a provincial pension plan or in which any month is excluded from their contributory period under this Act or under a provincial pension plan by reason of disability, the base contribution is deemed to have been made for earnings for the months in the year before the contributor reached 70 years of age or died, before the retirement pension became payable or that were not so excluded, as the case may be.
If paragraph (a) or (b) applies, the earnings for which the contributor is deemed to have made a base contribution for each such month are an amount calculated by dividing the contributor’s base unadjusted pensionable earnings for that year by the number of those months.
Marginal note:If no base contribution made
(2) For the purpose of calculating the pensionable earnings of a contributor for a month in any year for which the contributor made no base contribution, the amount of the earnings for which a base contribution is deemed to have been made for any month in the year is deemed to be zero.
Marginal note:When base contribution deemed to have been made
(3) For the purposes of this Part,
(a) a contributor is deemed to have made a base contribution for any year for which their base unadjusted pensionable earnings exceed their basic exemption for the year, and is deemed to have made no base contribution for any year for which their base unadjusted pensionable earnings do not exceed their basic exemption for the year; and
(b) a contributor is deemed to have made a base contribution for earnings for any month for which a base contribution is deemed by subsection (1) to have been made by them.
Marginal note:Earnings for which first additional contribution deemed for month
52.1 (1) For the purpose of calculating the first additional pensionable earnings of a contributor for a month in any year for which they have made a first additional contribution, that contribution is deemed to have been made for all months in the year, and the earnings for which the contributor is deemed to have made that contribution for each month in the year are an amount calculated by dividing their first additional unadjusted pensionable earnings for the year by 12, except that
(a) for a year in which the contributor reaches 18 years of age, the first additional contribution is deemed to have been made for earnings for the months in the year after they reached that age; and
(b) for a year in which the contributor reaches 70 years of age or dies or in which a retirement pension becomes payable to them under this Act, the first additional contribution is deemed to have been made for earnings for the months in the year before they reached 70 years of age or died or before the retirement pension became payable, as the case may be.
If paragraph (a) or (b) applies, the earnings for which the contributor is deemed to have made a first additional contribution for each such month are an amount calculated by dividing their first additional unadjusted pensionable earnings for that year by the number of those months.
Marginal note:If no first additional contribution made
(2) For the purpose of calculating the first additional pensionable earnings of a contributor for a month in any year for which the contributor made no first additional contribution, the amount of the earnings for which that contribution is deemed to have been made for any month in the year is deemed to be zero.
Marginal note:When first additional contribution deemed to have been made
(3) For the purposes of this Part,
(a) a contributor is deemed to have made a first additional contribution for any year for which their first additional unadjusted pensionable earnings exceed their basic exemption for the year, and is deemed to have made no first additional contribution for any year for which their first additional unadjusted pensionable earnings do not exceed their basic exemption for the year; and
(b) a contributor is deemed to have made a first additional contribution for earnings for any month for which a first additional contribution is deemed by subsection (1) to have been made by them.
Marginal note:Earnings for which second additional contribution deemed for month
52.2 (1) For the purpose of calculating the second additional pensionable earnings of a contributor for a month in any year for which they have made a second additional contribution, that contribution is deemed to have been made for all months in the year, and the earnings for which the contributor is deemed to have made that contribution for each month in the year are an amount calculated by dividing their second additional unadjusted pensionable earnings for the year by 12, except that
(a) for a year in which the contributor reaches 18 years of age, the second additional contribution is deemed to have been made for earnings for the months in the year after they reached that age; and
(b) for a year in which the contributor reaches 70 years of age or dies or in which a retirement pension becomes payable to them under this Act, the second additional contribution is deemed to have been made for earnings for the months in the year before they reached 70 years of age or died or before the retirement pension became payable, as the case may be.
If paragraph (a) or (b) applies, the earnings for which the contributor is deemed to have made a second additional contribution for each such month are an amount calculated by dividing their second additional unadjusted pensionable earnings for that year by the number of those months.
Marginal note:If no second additional contribution made
(2) For the purpose of calculating the second additional pensionable earnings of a contributor for a month in any year for which the contributor made no second additional contribution, the amount of the earnings for which that contribution is deemed to have been made for any month in the year is deemed to be zero.
Marginal note:When second additional contribution deemed to have been made
(3) For the purposes of this Part, a contributor is deemed to have made a second additional contribution for earnings for any month for which a second additional contribution is deemed by subsection (1) to have been made by them.
Marginal note:2009, c. 31, s. 35
28 (1) The portion of subsection 53(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Base unadjusted pensionable earnings for a year
53 (1) Subject to section 54, the base unadjusted pensionable earnings of a contributor for a year are an amount equal to
Marginal note:R.S., c. 30 (2nd Supp.), s. 20(1)
(2) Subparagraph 53(1)(b)(i) of the Act is replaced by the following:
(i) the contributor’s earnings on which a base contribution has been made for the year under this Act, calculated as the aggregate of
(A) the contributor’s salary and wages on which a base contribution has been made for the year, and
(B) the amount of any base contribution required to be made by the contributor for the year in respect of the contributor’s self-employed earnings divided by the contribution rate for self-employed persons for the year,
(3) The portion of subsection 53(1) of the Act after paragraph (c) is replaced by the following:
whichever is the least, except that if the amount calculated as provided in paragraph (a) is equal to or less than the amount of the contributor’s basic exemption for the year, the contributor’s base unadjusted pensionable earnings for that year are deemed to be zero.
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