Canada Pension Plan

Definition

• A social insurance program run by the Government of Canada. Canadians 18 and older contribute a portion of their income into a pension plan administrated by Human Resources and Social Development Canada (HRSDC). As of 2012, taxpayers contribute 4.95% of their earnings toward the Canada Pension Fund (CPP) to a maximum of $2,306.70. Employee contributions are matched by their employer, effectively doubling the employee's contributions.

Relevant Locations
Canada

Synonyms
canadian pension plan

Acronyms
CPP

Related Terms and Acronyms

• Annuity — Definition,
  • A regular periodic payment made by an insurance company to a policyholder for a specified period of time.
  • A financial instrument that disperses a number of payments over a set period of time.
• Canada Pension Plan Investment Board Act (CPPIB) — Acronym, Canada,
• Employment Insurance (EI) — Acronym, Canada,
  • A Service Canada program where premiums are paid by taxpayers and benefits are provided for the unemployed.
  ➥ Formerly known as Unemployment Insurance (UI).
• Fringe Benefit — Definition,
  • Employee compensation other than your wages, tips and salaries, such as health insurance, life insurance and pension plans. Usually referred to as a Bonus.
• Garnishment — Definition,
  • An amount withheld from your pay and remitted to another party, such as a creditor. You must include in your taxable income any amount that was garnished from your pay, because the full amount of your pay is considered to have been received by you even though some was withheld to pay your debts.
• Income Tax — Definition,
  • The main source of revenue for the federal government and many Provinces. The tax is based on your earned and unearned income. The amount or percentage taxed is based on the amount of income, using the governments graduated tax scale.
• Old Age Security (OAS) — Acronym, Important,
  • A Canadian pension plan for eligible Canadians over the age of 65.
• Payroll Taxes — Definition,
  • A tax based on wages and salaries that is deducted from employees pay cheques.
• Pension — Definition,
  • A retirement plan where money is set aside over many years for an individual's retirement.
• Tax-Free Savings Account (TFSA) — Acronym, Canada, Important,
  • A savings account for Canadians where income earned is not taxed.