VANCA helps Canadian veterans and families with 1:1 navigation, benefits guidance, and referral support for civilian transition, PTSD, injury, housing, and care

What happens to my pension when I medically release?

When you medically release from the Canadian Armed Forces, your pension is calculated based on your pensionable service and salary — the same as any other release. Key points about your CAF pension after medical release: - Your pension is not reduced because of a medical release - If you have at least 2 years of pensionable service, you can typically start receiving your pension immediately - If you are under age 55, your pension may be reduced based on your age — but if your release is related to a medical condition, different rules may apply - Your pension is taxable income - You can transfer your pension to another employer's plan or a locked-in retirement account under certain conditions Your pension is separate from VAC disability benefits. VAC benefits like Pain and Suffering Compensation are tax-free and are not reduced by your pension. SISIP/CAF LTD is also separate — it is an insurance benefit, not a pension. SISIP is reduced by the amount of your CAF pension.

How do I prepare for medical release?

Preparing for a medical release can feel overwhelming, but breaking it into steps makes it manageable. 1. Confirm your release details - Get your release date and release item in writing - The release item (typically 3(b) for medical) affects which programs you are eligible for - Talk to your Transition Centre or Personnel Support Unit 2. Request your medical records - Submit a Privacy Act request for your CAF medical records - Request your CF 98 forms (injury reports) - Keep copies of all medical documentation 3. Apply for income support - Apply to SISIP/CAF LTD through your Transition Centre - Apply to VAC for disability benefits through My VAC Account - Apply as early as possible — benefits can take time to process 4. Arrange civilian healthcare - Your CAF health coverage ends on your release date - Apply for provincial health coverage if you do not already have it - Research supplementary coverage (dental, prescription drugs, vision) - Transfer prescriptions to a civilian pharmacy 5. Organize financial documents - Collect all tax slips (T4, T4A, pension slips) - Request a pension estimate - Review your will, power of attorney, and insurance - Check your SISIP financial services account 6. Plan your next steps - Consider VAC rehabilitation programs - Explore education options (Education and Training Benefit) - Research career transition services - Connect with veteran support organizations You do not need to do everything at once. Focus on the most urgent items first — confirming your release date and applying for income support are usually the highest priority. Feeling uncertain during this transition is completely normal. You are not expected to understand everything at once.

Getting Started

A calm first step when the system feels bigger than you expected.

You do not need to solve everything today

This chapter is a starting point, not a test. Choose one or two actions that fit your situation. We can help you understand options, organize information and connect with the right service. We do not decide eligibility or replace legal, medical or financial professionals.

Start with what is happening now

People often arrive here because something changed: a release date was discussed, a health condition is affecting daily life, a decision letter arrived, income changed, or the paperwork became too much. Begin with the issue that feels most urgent — not with every possible benefit.

It is okay if this feels overwhelming. Many veterans tell us that the system is harder to navigate than it should be. Confusion with the system is not a personal failure.

Your first five steps

Name the one thing you most want help with

Write it down in plain language. Example: "I am medically releasing and do not know which income programs start first." You do not need to know the program names — a sentence is enough.

Gather only the documents connected to that problem

The letter you received, your release information, medical summary, or the name of the program you heard about. You do not need every document before you start.

Create or confirm access to your My VAC Account and your CRA account

Keep your mailing address, email address and direct-deposit information current in both accounts. Many communications and payments depend on these being correct.

Connect with your CAF Transition Centre if you are still serving or recently released

Ask for a transition interview and request a written list of actions and deadlines. Transition Centres can help coordinate the process across organizations.

Choose your next route

Learn independently using the Knowledge Centre. Use an interactive tool. Locate a service using the Support Map. Or request navigation support and we will walk alongside you.

A simple document folder

Many veterans find it helpful to keep copies of key documents in one organized place — physical or digital. You do not need everything immediately. Add documents as they arrive.

✓Release documents and Statement of Understanding

✓Medical records, release medical documents and CF 98 forms

✓VAC applications, decisions and correspondence

✓CAF LTD/SISIP, pension and insurance correspondence

✓Tax slips and notices of assessment

✓Education, employment and rehabilitation plans

✓A one-page contact list of your providers and case contacts

What to record when you call an organization

Keep a simple call log. This protects you if information later conflicts and helps you follow up effectively.

•Date and time of the call

•Name or identifier of the person you spoke with

•What you asked

•What they said

•Any deadline mentioned

•The next action and who is responsible

When information conflicts

Programs can overlap, change, or use different definitions. A benefit may be taxable while another is tax-free. One program may reduce another through an offset. Do not assume a verbal answer settles the issue.

Ask where the rule is written, save the link or letter, and request clarification in writing when possible. If something does not add up, it is reasonable to ask again.

After reading this chapter

Pick one action from the five steps above and write it down. Then choose where to go next from the routes below. You can always come back to this page.

Choose where to go next

Medical Release

Phases, records, health coverage, income and transition supports.

Health & Wellness

Treatment pathways, mental health services, rehabilitation and family supports.

Money, Taxes & Disability Supports

Taxable and tax-free income, multiple payers, DTC, CDB and RDSP.

Education & Employment

Education funding, career services, rehabilitation and credential recognition.

Benefits Library

Explore specific VAC and related programs.

Claim & Evidence Tools

Checklists, trackers, planners and worksheets.

Frequently Asked Questions

Real questions from Canadian Armed Forces members, Veterans, families and caregivers—answered in plain language.

Can't find your question? Ask us directly — we review every question and use them to build new answers.

Your Next Step

Keep Learning

Browse the Knowledge Centre

Use a Tool

Checklists & evidence tracker

Find Support

Locate services near you

Request Support

Talk to a navigator

Related Benefits

VAC Disability Benefits Income Replacement Benefit Benefits Explorer

Related Claim Tools

Disability Claim Checklist Evidence Tracker

Related Glossary Terms

My VAC Account

The online portal for Veterans Affairs Canada. Used to apply for benefits, track status, and manage correspondence.

Transition Centre

A CAF facility that helps releasing members coordinate transition tasks. Also called a Personnel Support Unit or IPSC.

CF 98

A Canadian Armed Forces Workplace Injury and Illness Report. Documents the circumstances of an injury or illness occurring during service.

SISIP

Service Income Security Insurance Plan — a CAF long-term disability insurance program for released members.

CRA

Canada Revenue Agency — the federal department responsible for taxes and tax credits including the Disability Tax Credit.

Official Sources

We review these links at least annually. Dates, amounts and eligibility rules can change.

This page provides navigation and education only. It is not legal, medical, financial, or tax advice. We do not decide eligibility or guarantee benefit outcomes. Official decisions are made by the responsible government department, tribunal, insurer, or benefit provider.

Last reviewed: July 2026