If you are unable to work due to disability, you are probably aware of your entitlement to private (LTD) Long Term Disability benefits – either with a group plan as a benefit through your employer, or because you have paid for individual coverage.
Did you know that there are also government benefits available to support people dealing with a long term disability? LTD benefits are also available through the Canada Pension Plan.
The Canada Pension Plan is well known for providing retirement benefits to seniors. But it also offers disability benefits to workers of all ages who meet certain criteria.
The criteria to qualify for CPP disability benefits is different from the standard set by private insurers. To qualify for CPP disability, you must:
- be under the age of 65;
- meet the minimum contribution requirements; and
- have a severe and prolonged disability
The first requirement is self-explanatory but the second and third are less obvious.
Minimum contribution requirements
The “contribution requirements” refers to the contributions you have made to the Canada Pension Plan. Every Canadian worker (outside of Quebec) is required to make regular contributions to CPP. The amount of the required contribution is related to your income. Normally, your employer will take the required amount off every pay cheque and send the contribution directly to CPP on your behalf.
To qualify for CPP disability benefits, you must have contributed to the CPP in:
- four of the last six years; or
- three of the last six years if you have contributed for at least 25 years.
There are some exceptions to this requirement – particularly if you have spent time out of the workforce to raise children – but this is the basic rule.
Sometimes an applicant has been unable to work for a number of years before they apply for CPP disability. On its face, this is a problem, because you may not have enough contributions in the last six years to qualify for benefits. However, if you can show that you have been disabled for the period of time since you stopped working and making CPP contributions, the rule on contributions may not count against you. CPP will count your contributions back from the date you became disabled, not the date you submit the application for benefits.
Severe and prolonged disability
The test for CPP disability benefits is not the same as the test used by private LTD insurers. To qualify for CPP disability, you must be able to show that your disability is both “severe” and “prolonged”. In other words, it means that your disability regularly stops you from doing any type of substantially gainful work and that your disability is long-term and of indefinite duration. The test is not whether you can do your own job, but whether you can do any job.
If you have questions about your CPP disability benefits, give us a call, we’d be happy to chat with you about your rights.