How Do I Divide Our CPP Pensions after We're Divorced?

Properly speaking, Canada Pension Plans are equalized, not divided, and what's being equalized are the spouses' pensionable credits.

CPP credits accumulate from the mandatory CPP payroll deductions taken from almost everyone's employment income. These credits build up over the years and are used by the CPP people in Ottawa to calculate the amount of the monthly CPP benefit payments each person will begin to receive when they reach the age of 65, or earlier, if they elect to take their pensions earlier, or later, if they elect to take them later.

Divorced married spouses and separated unmarried spouses may apply equalize their CPP credits. British Columbia is one of the few provinces that allow couples to not equalize their CPP credits, however if you decided not to equalize your CPP credits you must have either a court order or a separation agreement that expressly states that the credits won't be equalized. If there's no documentation of an agreement not to equalize CPP credits, either former spouse can apply for an equalization without the consent of the other spouse. It's automatic.

The amount of the CPP credits that will be equalized is the amount each spouse accumulated during their relationship after CPP has performed certain adjustments to account for things like periods out of the workforce on parental leave. The total amount of these credits is divided between each spouse. For people who have had a lower income than their former spouse, the equalization of CPP credits will increase the amount of the CPP pension they will eventually receive.

To apply for the equalization of your CPP credits, apply to Human Resources Development Canada. You can reach HRDC at:

1-800-277-9914
www.hrdc-drhc.gc.ca/isp