Michael Ford (post until Oct. 31/18)
Estates & Wills & Trusts

What is the Canada Pension Plan death benefit?

By Michele Allinotte

The financial issues that arise from the death of a loved one can cause a significant amount of stress. It is important to look at all the options available to you to help defray the costs.

The Canada Pension Plan offers a one-time lump-sum death benefit following the death of a contributor to the plan. The amount of the benefit depends on the deceased’s payments into the plan. The maximum benefit payable is $2,500.

You must have contributed to the plan for a minimum of three years for your estate to be eligible for this benefit. Also, if you contributed for more than nine years, then contributions must have been made in the lesser of either one-third of the calendar years in the contributory period or made a contribution in at least 10 calendar years.

The executor must apply for the benefit within 60 days of the death. Sometimes, there is no executor because the deceased did not have a will and no court application has been made (and, often, no application will be made) to appoint an estate trustee. In such cases, the death benefit may be paid to the person who paid the funeral expenses, or to a spouse or next-of-kin of the deceased.

Information on how to apply is available here.

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