The Canada Pension Plan is an insurance program designed to help Canadians provide income for their retirement. It also gives them income if they become disabled.
Working Canadians between the ages of 18 and 70 have to contribute to the Canada Pension Plan (or the Quebec Pension Plan), unless they are already receiving a pension from the plan.
Canada Pension Plan contributions are directly related to annual earnings. Each year, the basic exemption, maximum contribution limit, and benefits are adjusted according to the cost of living.
If you're an employer, Canada Pension Plan (CPP) is one of the things you must deduct from employees' pay cheques. If you're a sole proprietor, you pay your Canada Pension Plan contribution as part of your income tax.
