CPP-D retroactive amount needs to be paid back to LTD company?

Hi there, I recently received a retroactive amount of $20,000 from Service Canada. I contacted Service Canada, and they said they tried to reach out to the LTD insurance company on several occasions and they did not respond back or fill out a required form on their end. So Service Canada sent the payment to me instead.

The LTD company did not communicate or reach out to me until I told them I have received a large payment from Service Canada. That’s when they started to communicate more often and send letters and emails asking for the payment. In their letter and according to their math I owe $20,000 plus an additional several thousand in overpayments.

I just want to make sure I’m not getting screwed over and I’m I technically obligated to pay the retroactive amount back even though insurance company didn’t do their end to fill out paper work on time to submit to Service Canada. It was only when I communicated to them I received letter and payment from Service Canada that they started to communicate and pursue actively.

Do I just pay the retroactive amount plus overpayment to insurance company? Is the insurance company truly entitled to this amount?

What tax consequences are there on my end since I received it as CPP-D, and my LTD were non taxable.

What consequences are there if I don’t pay the retroactive amount to the LTD insurance company?

Thanks ahead of time for help!

For months you were paid LTD and have a backpayment of CPP-D for that month, you owe it to the insurance company.
You can ask the insurance company to explain the calculations.

CPP-D is taxable so you might owe more tax.
My LTD is non taxable and my CPP-D income is not enough to pay tax on so you might not owe anything.

I believe they can cut you off until they recover the money from your monthly payments.

1 Like

Thanks Jammer for your reply. I just recently retired this year in Feb. So my CCP-D has now changed to CCP retirement and the LTD payments are no longer coming.

If this is the case, can LTD company still get money from me somehow? for example do they have the power and authority to take my CCP retirement monthly payments direct from Service Canada until the retroactive payment is paid in full and will they charge interest?

What is the overpayment exactly? Usually the amount of the CPPD is the overpayment, not more.

They could sue you but that’s it.
I don’t see how you could win a lawsuit since you owe them the money.
I would count on interest accumulating.

1 Like

I can be more than the retroactive payment (eg $20,000), if the person received monthly payments for several months after retro payment was also receiving full LTD. In other words, you need to pay back for all months (during and after the retro payment) where you were getting a full LTD payment and full CPP payment. Sounds like this is what happened here unfortunately.

David Brannen

Disability Lawyer with Resolute Legal

The response posted above is based on the limited factual information made available and is not intended as a full and complete response to the question. The only reliable manner to obtain complete and adequate legal advice is to consult with a lawyer, fully explain your situation, and allow the lawyer enough time to research the applicable law and facts required to give an adequate opinion. The basic information provided above is intended as a public service only, a full one-on-one discussion with a lawyer should be done before taking any any action. The information posted on this forum is available to the viewing public and is not intended to create a lawyer client relationship with any person. If you want one-on-one advice, please click here to request a free consultation or call toll free 1-877-917-7050 to speak with a member with our disability claim support team.