Re: IRB CPP and OAS

by AirLog Fri 18 Sep 2020, 09:40

45jim,

Your right, it is clear as mud. If nobody that is over 65 and on extended IRB answers this question, then I will in a few years when I am 65 (I am also DEC so extended IRB).

AirLog

by 45jim Thu 17 Sep 2020, 21:29

Air Log,

I think you're incorrect, but only a post 65 vet on Extended IRB can clear this up for us, the Policy document is contradictory in its use of terms.

This is what I believe to be the correct calculation.

That Variable "A" (pre-65) is calculated as:

90% of the imputed income which is the greater of salary on release from the CF or a min of $4,500 per month.
So that number would be either 90% of $4,500 or a greater number.

This is the number before the Variable "B" amounts are deducted.

Variable "A" (post-65) is calculated as:

70% of the imputed income which is the greater of salary on release from the CF or a min of $4,500 per month.
So that number would be either 70% of $4,500 or a greater number.

This is the number before Variable "B" is deducted.

You will notice a discrepancy in the language in the reference, in both cases the calculation is expressed as "A - B = IRB monthly payment"

In Pre-65 they note "Variable A" as "equal to 90% of a veterans imputed income for a month. From that proscribed sources are deducted ("Variable B") to get the IRB Monthly Payment.

in post-65 they note "Variable A" as 70% of the IRB the Veteran would have been entitled to for the month on which he or she attained the age of 65 years before the the monthly amounts from proscribed sources are taken into account. Notice it does not say the "IRB Monthly Payment" and proscribed amounts are taken from variable A to get the IRB monthly payment. So this is "Variable A" not the IRB monthly payment, this is to account for the fact that the Imputed income at 65 will be higher than when it was awarded and it has to take into account the Career Progression Factor.

Is anyone on here that is 65+ and on extended IRB that could clear this up for us?

by AirLog Thu 17 Sep 2020, 18:21

45jim,

It is 70% of the 90% that you were receiving prior to your 65th BDay. The attached link clarifies IRB with examples.

https://www.veterans.gc.ca/pdf/about-vac/legislation-policies/policies/doc2829-income-replacement-benefit-01042019-01-eng.pdf

AirLog

by 45jim Thu 17 Sep 2020, 12:54

Just to clarify, the IRB (if you have a DEC) goes from 90% of your released salary to 70% of your released salary not 70% of the 90% you receive under IRB.

by Guest Thu 10 Sep 2020, 09:45

IF you delay your OAS and CPP at 65 say to 70 years of age.
Then your Military Bridge benefits automatically terminated at 65.
Then at 65 your IRB is reduced to 70%
THEN you must advise VAC of the reduced Military pension amounts. (If we didn't have the reduction to 70% your IRB would rise by this reduction equally)
Delaying your pensions can have a slight increase overall amount in some cases -it is complicated
The only reason you can actually make money is IF you have CIAS that additional monies is the min amount and that can lead to an overall amount above 70%.
You can call VAC and request a discussion with the benefits expert.
By delaying the CPP and the OAS will lead to more monies at 70. So your IRB will be at the min amount 1134.00 once that occurs any increases due to delaying it will be bonus bucks.
In my case, it is 440 per month at 70 years of age. Nevertheless, I am not doing it. I am taking the oas and cpp at 65 advising VAC and retiring from this mess.

by **Kramer** Wed 09 Sep 2020, 15:30

CALCULATING CPPD TO CPP

I found this; it is not accurate to the dollar, but it can give a person a basic idea as well as possibly answer some other questions. It appears there are a number of us this will/could affect. I suspect that post 65, CPP and OAS just might equal CPPD? Keep in mind, these figures/examples were/are from 2018.

https://retirehappy.ca/cpp-disability-benefit/

Riddick

by AirLog Wed 09 Sep 2020, 15:17

At 65 years old regardless if you collect CPP or OAS your IRB will be reduced from 90% to 70% of the 90% amount. When CPPD transforms into CPP at 65 it will be reduced to your CPP amount which will be lower than the CPPD amount. You can check your Service Canada Account to see what your CPP estimate will be at 65 years old. In my case I will go from a CPPD amount of approximately $1,350/month (before taxes) to approximately $1,150/month (before taxes). These amounts are my personal amounts from my Service Canada Account. As I have said, everyone's CPPD and/or CPP amount is different as it pertains to your working years and your annual income.

Hope this help's.

AirLog

by johnny211 Wed 09 Sep 2020, 14:36

Unknown Soldier - I hear you 2 as I will be in the same boat in 5 yrs. I also am curious of the answer. But you got me thinking another ? . When Our CPPD gets changed to CPP at 65, what dollar amount is that? Same as CPPD, or another number...Tks,,VVV

by Unknown Soldier Wed 09 Sep 2020, 12:56

AirLog wrote:Oh boy, I believe that I complicated a very straightforward question. My apologies.

First off your CF pension is automatically reduced by the amount calculated on release with respect to CPP at 65. In my particular case I was informed in writing with my pension paperwork that at 65 years old my CF pensions would be reduced by $750 per month. Whether or not I take my CPP at 65 or defer it to a later date. This is fixed and this military pension reduction won't be deferred/changed in any way whatsoever.

Now for IRB. If you are on IRB and have a DEC determination, then, IRB is a lifetime benefit. Up to age of 65, IRB is 90% of your pre-release salary. At 65 years of age and if you are in receipt of IRB and are designated DEC (lifetime IRB) then your IRB will be calculated at 70% of the IRB benefit prior to age 65. So simply put 70% of 90%.

CPPD or CPP and OAS are different beasts all together. They are all offsets in calculating your IRB benefit whenever you are in receipt of them (much as your pension is an offset). In my case I am on CPPD and it is used to reduce my monthly IRB benefit. What I am now contemplating is whether or not to defer my CPP and OAS when I turn 65 (until age 70) to see if it is financially beneficially to do so in my particular financial situation. If I elect to defer my CPP and OAS at age 65 then CPP and OAS are not calculated as an offset for my IRB (70% of the 90%). My military pension will still be reduced by that magic number that was communicated to you with your first pension payment. Regardless if you defer your CPP at 65 years of age or not.

Not sure if this clarifies this or not but don't hesitate to ask questions on this forum, to your family and friends or send a question to VAC. This is what I did to clarify what would happen to my IRB if I deferred my CPP and OAS to a date later than my 65th birthday.

No numerical examples provide in this explanation as I find that they could cause more questions than answers.

BigRex, if you have any input it would be greatly appreciated. Your words of wisdom are always appreciated and bang on.

AirLog

in most cases all the people here have mental issues, so this must be mind boggling to follow...in my case it’s twofold,,because I’m infantry,lol. But in trying to follow all this, you, like me are receiving IRB that was reduced by your CPPD. Since CPPD automatically transforms to CPP at 65 if the pensioner does nothing about it, are you saying at 65 you are basically going to cancel your CPPD payment and tell the Gov. you want to start drawing your CPP again at 70..? And to ask one more time if you/I do this , will that stop IRB from going from 90% to 70% ( even though my mil. Pension with be reduced at 65, because it is linked to nothing but my age)

by AirLog Wed 09 Sep 2020, 09:37

Oh boy, I believe that I complicated a very straightforward question. My apologies.

First off your CF pension is automatically reduced by the amount calculated on release with respect to CPP at 65. In my particular case I was informed in writing with my pension paperwork that at 65 years old my CF pensions would be reduced by $750 per month. Whether or not I take my CPP at 65 or defer it to a later date. This is fixed and this military pension reduction won't be deferred/changed in any way whatsoever.

Now for IRB. If you are on IRB and have a DEC determination, then, IRB is a lifetime benefit. Up to age of 65, IRB is 90% of your pre-release salary. At 65 years of age and if you are in receipt of IRB and are designated DEC (lifetime IRB) then your IRB will be calculated at 70% of the IRB benefit prior to age 65. So simply put 70% of 90%.

CPPD or CPP and OAS are different beasts all together. They are all offsets in calculating your IRB benefit whenever you are in receipt of them (much as your pension is an offset). In my case I am on CPPD and it is used to reduce my monthly IRB benefit. What I am now contemplating is whether or not to defer my CPP and OAS when I turn 65 (until age 70) to see if it is financially beneficially to do so in my particular financial situation. If I elect to defer my CPP and OAS at age 65 then CPP and OAS are not calculated as an offset for my IRB (70% of the 90%). My military pension will still be reduced by that magic number that was communicated to you with your first pension payment. Regardless if you defer your CPP at 65 years of age or not.

Not sure if this clarifies this or not but don't hesitate to ask questions on this forum, to your family and friends or send a question to VAC. This is what I did to clarify what would happen to my IRB if I deferred my CPP and OAS to a date later than my 65th birthday.

No numerical examples provide in this explanation as I find that they could cause more questions than answers.

BigRex, if you have any input it would be greatly appreciated. Your words of wisdom are always appreciated and bang on.

AirLog

by Unknown Soldier Tue 08 Sep 2020, 22:23

Riddick wrote:
Unknown Soldier wrote:
AirLog wrote:IRB drops to 70% at age 65. Not linked to whether or not you take CPP/OAS. CPP, OAS, and other offsets are used to offset your IRB at 65. If you are not in receipt of CPP or OAS at 65 then they won't be used as an offset.

AirLog
sorry, lol, but I’m still not catching what your pitching, in the first sentence you said IRB drops to 70% at 65, with no link to CPP, but in the 2nd sentence you said if you are not in receipt of CPP, at 65, then it won’t be used as an offset. So I’m asking, again lol. I’m on IRB, let’s say that’s $2000 a month, if l tell Canada pension to defer my CPP to 70, then does that mean my IRB will stay $2000 at 65, or will it become $ 1400 no matter what.?

Quote I’m on CPPD , that’s one of the deductions that came off my IRB, so l didn’t really lose any money monthly , it’s just now coming from 2 Seperate sources. What’s this splitting of your CPP with your spouse?.?, how exactly would something like that work, what would be the purpose, to stay under a certain income take home pay for taxes?

I am getting a little dizzy here too lol Unknown Soldier....you say you are on CPPD but you also mention..... "if l tell Canada pension to defer my CPP to 70, then does that mean my IRB will stay $2000 at 65, or will it become $ 1400 no matter what.?"

As far as I know....CPPD will automatically be switched over to CPP at age 65....and from my limited understanding.....at a slightly reduced amount. So from what I understand you are curious about is.....cancelling (or deferring?) your CPPD once you reach age 65 and request your CPP be initiated at age 70 so your IRB is not affected?

Riddick
Riddick[/quote] you know what you’re right I totally forgot that CPPD becomes cpp at 65, so l guess the question is moot, for me anyway, lol. But I bet there are other vets on IRB But not on CPPD, who would be interested to know if they defer their cpp will this stop the drop from 90 to 70% IRB at 65

by **Teentitan** Tue 08 Sep 2020, 20:56

It has been difficult to keep track of offsets for the alphabet of benefits with VAC. That said this is what I remember...

At 65 a veteran on IRB will reduced to 70%. Note IRB reduction is not tied to said veteran receiving CPP/OAS payment. The reduction is in the legislation.

If a veteran is on CPPD when they reach 65 it's changed to OAS automatically. It's in the legislation.

If a veteran is in receipt of a CAF pension AND is in receipt of CPPD the CAF pension is offset (there is no real standard equation to figure out the offset).

When a veteran reaches 65 and decides to take the OAS/CPP and is in receipt of a CAF pension the pension is offset. If the veteran defers CPP/OAS until age 70 then their CAF pension will not be offset. NOTE: call the pension office and inform them of your decision to make sure that your CAF pension is not automatically offset)

Hope this helps.

by **Kramer** Tue 08 Sep 2020, 20:45

Unknown Soldier wrote:
AirLog wrote:IRB drops to 70% at age 65. Not linked to whether or not you take CPP/OAS. CPP, OAS, and other offsets are used to offset your IRB at 65. If you are not in receipt of CPP or OAS at 65 then they won't be used as an offset.

AirLog
sorry, lol, but I’m still not catching what your pitching, in the first sentence you said IRB drops to 70% at 65, with no link to CPP, but in the 2nd sentence you said if you are not in receipt of CPP, at 65, then it won’t be used as an offset. So I’m asking, again lol. I’m on IRB, let’s say that’s $2000 a month, if l tell Canada pension to defer my CPP to 70, then does that mean my IRB will stay $2000 at 65, or will it become $ 1400 no matter what.?

Quote I’m on CPPD , that’s one of the deductions that came off my IRB, so l didn’t really lose any money monthly , it’s just now coming from 2 Seperate sources. What’s this splitting of your CPP with your spouse?.?, how exactly would something like that work, what would be the purpose, to stay under a certain income take home pay for taxes?[/quote]

I am getting a little dizzy here too lol Unknown Soldier....you say you are on CPPD but you also mention..... "if l tell Canada pension to defer my CPP to 70, then does that mean my IRB will stay $2000 at 65, or will it become $ 1400 no matter what.?"

As far as I know....CPPD will automatically be switched over to CPP at age 65....and from my limited understanding.....at a slightly reduced amount. So from what I understand you are curious about is.....cancelling (or deferring?) your CPPD once you reach age 65 and request your CPP be initiated at age 70 so your IRB is not affected?

Riddick
Riddick

by Unknown Soldier Tue 08 Sep 2020, 18:56

AirLog wrote:IRB drops to 70% at age 65. Not linked to whether or not you take CPP/OAS. CPP, OAS, and other offsets are used to offset your IRB at 65. If you are not in receipt of CPP or OAS at 65 then they won't be used as an offset.

AirLog

sorry, lol, but I’m still not catching what your pitching, in the first sentence you said IRB drops to 70% at 65, with no link to CPP, but in the 2nd sentence you said if you are not in receipt of CPP, at 65, then it won’t be used as an offset. So I’m asking, again lol. I’m on IRB, let’s say that’s $2000 a month, if l tell Canada pension to defer my CPP to 70, then does that mean my IRB will stay $2000 at 65, or will it become $ 1400 no matter what.?

by AirLog Tue 08 Sep 2020, 12:01

IRB drops to 70% at age 65. Not linked to whether or not you take CPP/OAS. CPP, OAS, and other offsets are used to offset your IRB at 65. If you are not in receipt of CPP or OAS at 65 then they won't be used as an offset.

AirLog

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