Understanding Widow's Pension in Canada

The Concept of Widow's Pension

In Canada, the widow's pension, also known as the survivor benefit, is a monthly payment issued by the government to a person whose spouse or common-law partner has passed away. This payment is part of the Canada Pension Plan (CPP) that is designed to partially replace the income of the deceased partner. The amount of the widow's pension is determined by how much and for how long the deceased spouse or partner contributed to the CPP. In addition, other factors such as the survivor's age and whether they receive other types of CPP benefits also influence the amount.

Eligibility for Widow's Pension

To be eligible for the widow's pension, you must be a surviving spouse or common-law partner of a contributor to the CPP. Even divorced partners who were married to the deceased at the time of their death may be eligible. There is no minimum age requirement for the survivor's pension. However, the amount of the pension changes depending on the receiver's age. A lower rate is applied for those under age 65 and a higher rate for those aged 65 and over.

How to Apply for Widow's Pension

To apply for a widow's pension, you need to fill out the required forms and submit them to Service Canada either online or through mail. It's recommended to apply as soon as possible after the contributor's death. If application is delayed, you may lose benefits as the CPP can only make back payments for up to 12 months. Once your application is approved, you will start receiving a monthly payment.

Determining the Amount of Widow's Pension in Canada

General Calculation of the Benefit

The amount of Canadian widow's pension is generally 60% of the deceased’s CPP retirement pension if the surviving spouse is 65 years of age or older, or a flat rate plus 37.5% of the deceased’s CPP retirement pension if the surviving spouse is under 65. The amount can be adjusted based on several factors, such as: the age of the surviving spouse, whether the surviving spouse is disabled, and the surviving spouse's overall retirement income. It's important to note that there's a maximum amount that can be paid out each month, even if the deceased spouse or partner contributed to the CPP extensively.

Example of Calculation

If a deceased spouse’s CPP retirement pension is $700 per month and the surviving spouse is 65 years or older, the surviving spouse will receive a widow’s pension of $420 per month (60% of $700). However, if the surviving spouse's own CPP retirement pension is $600 per month, the combined payment (own CPP retirement pension plus widow’s pension) can't exceed the maximum CPP pension amount, which is $1,203.75 as of 2022. Therefore, the amount of the widow’s pension may be reduced.

Consideration of Other Benefits

If the surviving partner is also eligible for other CPP benefits, such as disability benefits or retirement pension, the total combined benefits can't exceed the maximum CPP retirement pension amount. Therefore, if a person receives multiple benefits, the amount of each benefit may be adjusted. Also, the widow's pension may be reduced if the surviving spouse starts receiving retirement pension before age 65.

Adjustments and Changes to the Widow's Pension

Regular Updates of the Pension

Each year, the Canadian government adjusts the CPP rates, and consequently, the widow's pension, depending on the Consumer Price Index (CPI). The CPI is a measure of the average change over time in the prices paid by consumers for goods and services. This Index plays a significant role in determining the inflation rate, which ultimately influences the CPP rates.

Effect of Remarriage or Cohabitation

Previously, remarriage or moving in with a new partner ended the survivor's right to receive the widow's pension. However, changes to the law now allow survivors to continue receiving the widow's pension, regardless of their relationship status. This now means that widowed individuals can remarry or cohabitate without losing their survivor's benefit.

Impact of Immigration Status

The widow's pension is also available to immigrants who have worked in Canada and contributed to CPP, even after returning to their home country. However, the payment may be affected by social security agreements between Canada and the resident country of the immigrant. Consequently, it's important for immigrants and non-residents of Canada to consult with Service Canada or a financial advisor to understand how these factors may impact their entitlement to the widow's pension.