Canada Pension Plan

Marginal note:Average monthly pensionable earnings in case of pension commencing after December, 1975

• 48 (1) Subject to subsections (2), (3) and (4), where a retirement pension becomes payable to a contributor commencing with any month after December, 1975, his average monthly pensionable earnings are an amount calculated by dividing his total pensionable earnings by the total number of months in his contributory period or by the basic number of contributory months, whichever is the greater.

• Marginal note:Deductions in calculating average monthly pensionable earnings of certain months during child raising years

  (2) In calculating the average monthly pensionable earnings of a contributor in accordance with subsection (1) for the purpose of calculating or recalculating benefits payable for a month commencing on or after January 1, 1978, there may be deducted

  • (a) from the total number of months in a contributor’s contributory period, those months during which he was a family allowance recipient and during which his pensionable earnings were less than his average monthly pensionable earnings calculated without regard to subsections (3) and (4), but no such deduction shall reduce the number of months in his contributory period to less than the basic number of contributory months, except

    • (i) for the purpose of calculating a disability benefit in respect of a contributor who is deemed to have become disabled for the purposes of this Act after December 31, 1997, in which case the words “the basic number of contributory months” shall be read as “48 months”,

    • (i.1) for the purpose of calculating a disability benefit in respect of a contributor who is deemed to have become disabled for the purposes of this Act in 1997, in which case the words “the basic number of contributory months” shall be read as “24 months”, and

    • (ii) for the purpose of calculating a death benefit and a survivor’s pension, in which case the words “the basic number of contributory months” shall be read as “thirty-six months”; and

  • (b) from his total pensionable earnings, the aggregate of his pensionable earnings attributable to the months deducted pursuant to paragraph (a).

• Marginal note:Deductions allowed where contributory period ends after age 65

  (3) Where a contributor’s contributory period ends after the month preceding the month in which he reaches sixty-five years of age and the total number of months in his contributory period remaining after the deduction under paragraph (2)(a) exceeds the basic number of contributory months, in calculating his average monthly pensionable earnings in accordance with subsection (1) there shall be deducted

  • (a) from the total number of months remaining in his contributory period, the number of months therein after he reached sixty-five years of age or by which the total exceeds the basic number of contributory months, whichever is the lesser; and

  • (b) from the contributor’s total pensionable earnings remaining after the deduction under paragraph (2)(b), the aggregate of the contributor’s pensionable earnings for a number of months equal to the number of months deducted under paragraph (a), for which months that aggregate is less than — or, if not less than, then equal to — the aggregate of the contributor’s pensionable earnings for any other like number of months in the contributor’s contributory period other than for months for which a deduction has already been made under subsection (2).

• Marginal note:Deductions allowed where number of months remaining exceeds 120

  (4) Where the number of months remaining after making any deduction under subsection (2) or (3) from the total number of months in the contributory period of a contributor exceeds one hundred and twenty, in calculating his average monthly pensionable earnings in accordance with subsection (1) there shall be deducted

  • (a) from the number of months remaining, a number of months equal to the lesser of

    • (i) subject to subsection (5), if the retirement pension or other benefit becomes payable commencing with a month before January 2012, fifteen per cent of the number remaining — and sixteen per cent commencing with a month after December 2011 and before January 2014 and seventeen per cent commencing with a month after December 2013 — and, if that per cent includes a fraction of a month, the fraction shall be taken to be a complete month, and

    • (ii) the number of months by which the number remaining exceeds one hundred and twenty; and

  • (b) from the contributor’s total pensionable earnings remaining after making any deduction under subsection (2) or (3), the aggregate of the contributor’s pensionable earnings for a number of months equal to the number of months deducted under paragraph (a), for which months that aggregate is less than — or, if not less than, then equal to — the contributor’s aggregate pensionable earnings for any like number of months in the contributor’s contributory period other than for months for which a deduction has already been made under subsection (2) or (3).

• Marginal note:Exception — same percentage

  (5) The percentage used in a calculation of the amount of average monthly pensionable earnings under subsection (4) is to be used in the calculation of other benefits based on that amount.