A two-tiered formula is used to calculate member contributions to the Teachers' pension plan.
In 2012, you will contribute:
- 10.8% of your annual salary up to the Canada Pension Plan (CPP) contributions and benefits limit, plus
- 12.4% of any salary above the CPP limit.
The CPP limit, which changes annually, is $50,100 in 2012.
Contributions are matched by the Ontario government and participating private employers on behalf of all members.
How does the contribution formula work?
Contributions to the Teachers' plan are lower on earnings up to the CPP limit and higher on earnings above it. Similarly, when you turn 65, your pension provides a lower benefit on salary up to an average of the CPP limit and a higher benefit on salary above it. This integration is achieved by applying an offset to your pension when you turn age 65.
For more information on integration, read our fact sheet How CPP and Your Teachers' Pension Work Together (377 KB PDF).
Examples:
As our examples show, a teacher earning a salary of $75,000 will pay $8,498.40 in pension contributions in 2012, while a teacher earning $51,000 will contribute $5,522.40.
