201 5

Calculation of the retirement pension

An example showing how a retirement pension is calculated

A person born in November 1950 who applies for a retirement and the 4 preceding years (AMPE-5). The result is then divided
pension at age 65 will be entitled to his or her pension in by the maximum pensionable earnings (MPE) for the year being
December 2015. How much would the retirement pension be adjusted (shown in column II of the table).
if the person’s Statement of Participation shows the earnings
For 2015, the person’s earnings for 1968 (in our example, 425 $)
entered in column I of the table on the back of this leaflet?
would be adjusted as follows:

425 $ x AMPE-5 for 2015 = 425 $ x 51 120 $ = 4 260 $

General rules MPE for 1968 5 100 $
The pension for a person under age 65 is reduced, for the
entire period the pension is paid, according to an actuarial Where AMPE-5 for 2015 =
adjustment factor. If the person was born before 1 January (48 300 $ + 50 100 $ + 51 100 $ + 52 500 $ + 53 600 $) ÷ 5 = 51 120 $
1954, the amount of his or her pension is decreased by 0,5% After adjustment, the earnings of 425 $ for 1968 are valued at
for each month preceding the beneficiary’s 65th birthday. If the 4 260 $ in 2015.
person was born in 1954 or later, the adjustment factor varies
depending on the amount of the retirement pension. For pensions A similar adjustment must be made for each of the years in
beginning in 2015, it varies between 0,5% and 0,56% for each question. The results are shown in column III of the table.
month preceding the beneficiary’s 65th birthday. The retirement
pension of a person who is over age 65 will increase by 0,7%
for each month following the beneficiary’s 65th birthday and the
Step 2
beginning of his or her pension, to a maximum of 42% at age 70. Determining the months and earnings to be used
in the calculation
A retirement pension may be increased each year if, during
the preceding year, the beneficiary made contributions. This A person’s contributory period begins on the first day of the
increase (known as the retirement pension supplement) applies month that follows the month of his or her 18th birthday, but no
in all cases. earlier than 1 January 1966, and ends at the end of the earliest
of the following months:
Disability pensions and surviving spouse’s pensions are based
on the amount of the retirement pension, without taking into • the month preceding the one in which a retirement pension
account the actuarial increase or decrease. The death benefit becomes payable;
is a lump-sum payment of a maximum amount of 2 500 $.
• the one in which the beneficiary turns 70;

A three-step process: • the month in which the beneficiary dies.

• Step 1: adjusting pensionable earnings In our example, the contributory period begins on 1 December 1968
and ends at the end of November 2015, that is, the month before
• Step 2: determining the months and earnings to be used in
the one in which payment of the pension starts, for a total
the calculation
contributory period of 564 months. (See column V of the table.)
• Step 3: actually calculating the pension
All the pensionable employment earnings during that period can
be used in calculating the pension. However, the Act respecting
the Québec Pension Plan allows the exclusion of 15% of the
Step 1 months in the contributory period during which the person’s
Adjusting pensionable earnings earnings were the lowest. In the example, a total of 85 months
Before calculating the average monthly pensionable earnings, can be excluded (564 months x 15% = 85), representing earnings
past yearly earnings must be adjusted to their current value. of 247 485,63 $, as shown in columns VI and VII of the table.
We do this by multiplying each year’s pensionable earnings This means that the pension will be calculated on the basis of
(shown in column I of the table) by the average of the maximum the best 479 months (564 - 85 = 479), which represent earnings
pensionable earnings for the year in which the pension begins of 2 242 498,40 $ - 247 485,63 $ = 1 995 012,77 $.
Step 3 In our example, payment of the monthly retirement pension
of 1 041,24 $ begins in December 2015. If the contributor had
Actually calculating the pension contributed the maximum amount for the 479 required months, (for
In calculating the average monthly earnings, we must exclude 39 years and 11 months, he or she would receive the maximum
the 85 months mentioned above from the contributory period payable in 2015 (1 065 $ a month). If a person with the same
and at the same time, subtract from the person’s total earnings average monthly employment earnings had reached age:
(2 242 498,40 $) the earnings for those 85 months of lowest
earnings. As shown in column IV of the table, those months • 62 in 2015 (36 months before age 65), the pension would be
are the 12 months of 1969, 1970, 1971, 1972, 1979, 1986 and 853,82 $ a month, according to the following formula:
1999 and one month in 1998, which amounts to 247 485,63 $ 1 041,24 $ - 36 x 0,5 x 1 041,24 $ = 853,82 $
in earnings. The result is as follows:
2 242 498,40 $ - 247 485,63 $ = 1 995 012,77 $. 100
The monthly retirement pension corresponds to 25% of the
• 67 in 2015 (24 months after age 65), the pension would be
average monthly earnings for the best 479 months, calculated
1 216,17 $ a month, according to the following formula:
as follows:
( 25 x 1 995 012,77 $ ) ÷ 479 = 1 041,24 $ 1 041,24 $ + 24 x 0,7 x 1 041,24 $ = 1 216,17 $

100 100

Table of earnings
I II III IV V VI VII
Annual pensionable Maximum pensionable Adjusted Adjusted Months in Months Earnings
Year employment earnings earnings annual earnings monthly earnings the contributory excluded excluded (15%)
$ $ $ $ period (15%) $
1968 425# 5 100 4 260,00 4 260,00 1 — —
1969 3 899* 5 200 38 330,17 3 194,18 12 12 38 330,17
1970 4 225* 5 300 40 751,32 3 395,94 12 12 40 751,32
1971 4 422* 5 400 41 861,60 3 488,47 12 12 41 861,60
1972 0* 5 500 0,00 0,00 12 12 0
1973 5 900 5 900 51 120,00 4 260,00 12 — —
1974 6 600 6 600 51 120,00 4 260,00 12 — —
1975 7 400 7 400 51 120,00 4 260,00 12 — —
1976 8 300 8 300 51 120,00 4 260,00 12 — —
1977 9 300 9 300 51 120,00 4 260,00 12 — —
1978 10 400 10 400 51 120,00 4 260,00 12 — —
1979 6 702* 11 700 29 282,58 2 440,22 12 12 29 282,58
1980 13 100 13 100 51 120,00 4 260,00 12 — —
1981 14 700 14 700 51 120,00 4 260,00 12 — —
1982 16 500 16 500 51 120,00 4 260,00 12 — —
1983 18 500 18 500 51 120,00 4 260,00 12 — —
1984 20 800 20 800 51 120,00 4 260,00 12 — —
1985 23 400 23 400 51 120,00 4 260,00 12 — —
1986 23 466* 25 800 46 495,42 3 874,62 12 12 46 495,42
1987 24 113* 25 900 47 592,92 3 966,08 12 — —
1988 25 232* 26 500 48 673,96 4 056,16 12 — —
1989 26 101* 27 700 48 169,07 4 014,09 12 — —
1990 27 332* 28 900 48 346,43 4 028,87 12 — —
1991 29 954* 30 500 50 204,87 4 183,74 12 — —
1992 31 250* 32 200 49 611,80 4 134,32 12 — —
1993 31 782* 33 400 48 643,59 4 053,63 12 — —
1994 32 751* 34 400 48 669,51 4 055,79 12 — —
1995 34 900 34 900 51 120,00 4 260,00 12 — —
1996 33 333* 35 400 48 135,11 4 011,26 12 — —
1997 35 800 35 800 51 120,00 4 260,00 12 — —
1998 33 825* 36 900 46 860,00 3 905,00 12 1 3 905,00
1999 34 283* 37 400 46 859,54 3 904,96 12 12 46 859,54
2000 37 600 37 600 51 120,00 4 260,00 12 — —
2001 38 300 38 300 51 120,00 4 260,00 12 — —
2002 35 842* 39 100 46 860,44 3 905,04 12 — —
2003 36 575* 39 900 46 860,00 3 905,00 12 — —
2004 37 125* 40 500 46 860,00 3 905,00 12 — —
2005 37 675* 41 100 46 860,00 3 905,00 12 — —
2006 40 000* 42 100 48 570,07 4 047,51 12 — —
2007 43 700 43 700 51 120,00 4 260,00 12 — —
036-RRQ-2015 01-A

2008 44 900 44 900 51 120,00 4 260,00 12 — —

2009 46 300 46 300 51 120,00 4 260,00 12 — —
2010 47 200 47 200 51 120,00 4 260,00 12 — —
2011 48 300 48 300 51 120,00 4 260,00 12 — —
2012 50 100 50 100 51 120,00 4 260,00 12 — —
2013 51 100 51 100 51 120,00 4 260,00 12 — —
2014 52 500 52 500 51 120,00 4 260,00 12 — —
2015 49 133# 53 600 46 860,00 4 260,00 11 — —
Total — — 2 242 498,40 — 564 85 247 485,63
Earnings of 247 485,63 $ (for the 85 months of lowest earnings) must be subtracted from 2 242 498,40 $, which leaves total earnings of 1 995 012,77 $
for the remaining 479 months.
* The asterisk indicates that the contributor did not reach the maximum pensionable earnings for the year.
# The pound sign indicates the maximum pensionable earnings for the months during which the contributor could contribute to the Québec Pension Plan.