CRA Payroll Deductions and Remittances

Every Ontario employer that runs payroll carries a set of federal obligations to the Canada Revenue Agency (CRA): withhold the right amounts from each employee’s pay, remit them on the schedule the CRA assigns, and file an annual information return. This page sets out the four pieces of that obligation — the Canada Pension Plan (CPP/CPP2) figures, the Employment Insurance (EI) premium figures, the source-deduction remittance schedule, and the T4/T4A filing — and links each one to its official CRA source.

One idea governs everything below. These are federal figures that reset every January 1, announced the prior autumn. The published rates, maximums, and thresholds are a snapshot, not a permanent fact: almost every dollar figure here goes stale the following January and must be re-verified at the CRA page of record. The January reset is not automatic, and using payroll software does not transfer the obligation to confirm the numbers it used. These federal CRA obligations are also distinct from Ontario’s provincial Employer Health Tax, which is a separate payroll tax with its own rules.

What are the 2026 CPP and CPP2 contribution rates and maximums?

As of January 1, 2026, the maximum pensionable earnings (YMPE) is $74,600, the basic exemption is $3,500, and the employee and employer contribution rate is 5.95%, producing a maximum annual contribution of $4,230.45 each for employee and employer, or $8,460.90 for a self-employed person. The separate CPP2 second additional contribution applies on earnings between the YMPE of $74,600 and a second ceiling of $85,000 at a rate of 4%, with an employee maximum of $416.00 and a self-employed maximum of $832.00.

The Canada Pension Plan contribution figures reset every January 1. The federal government announces the new numbers the prior autumn, the CRA updates its rate page, and the employer carries the new figures into payroll for the year. This is an annual update, not a one-time setup: each year’s maximums and contribution amounts differ from the last. The figures that change each January are the year’s maximum pensionable earnings (the YMPE), the contribution rate, and the resulting dollar maximums for both employees and employers. One figure does not move — the basic exemption has stayed at $3,500 for decades.

The full set of values as of January 1, 2026 (from the CRA “CPP contribution rates, maximums and exemptions” page, which was modified 2025-10-31; the 2026 figures were announced October 30, 2025):

• Maximum pensionable earnings (YMPE): $74,600
• Basic exemption: $3,500 (unchanged for decades)
• Employee and employer contribution rate: 5.95%
• Maximum annual contribution, employee and employer each: $4,230.45
• Maximum annual contribution, self-employed: $8,460.90
• CPP2 (the second additional contribution, on earnings between the YMPE of $74,600 and the second ceiling of $85,000): rate 4%, with an employee maximum of $416.00 and a self-employed maximum of $832.00

Two recurring errors arise here. The first is treating the January reset as automatic and missing the maximums: payroll deductions stop once an employee reaches the annual maximum contribution, so the dollar maximum — not just the rate — has to be current. The second is overlooking CPP2, which is a separate calculation on a band of higher earnings, with its own rate and its own maximum, and which applies on top of the base contribution rather than replacing it. Every dollar figure above goes stale on January 1, 2027: the YMPE and the second ceiling typically rise each January, which moves the dollar maximums with them, and the rate can change as well. Confirm the current figures at the CRA “CPP contribution rates, maximums and exemptions” page before relying on them.

Source: Canada Revenue Agency, “CPP contribution rates, maximums and exemptions” (page modified 2025-10-31). Confidence: verified.

What are the EI premium rates and maximum insurable earnings?

As of January 1, 2026, the maximum insurable earnings is $68,900, the employee premium rate is 1.63%, the maximum annual employee premium is $1,123.07, and the maximum annual employer premium — 1.4 times the employee rate — is $1,572.30. Like the CPP figures, these reset every January 1.

The employer withholds EI premiums from each employee’s insurable earnings, adds the employer share, and remits both to the CRA. When the year turns, the employer updates payroll for the new rate and the new earnings cap. This is a recurring, predictable change: the federal government reviews the EI premium rate annually, and it can move with the EI Operating Account, so the number is announced fresh each year rather than fixed. The maximum insurable earnings is the per-employee ceiling — once an employee’s insurable earnings for the year reach the cap, no further EI premiums are withheld for that employee that year.

The figures as of January 1, 2026 (from the CRA “EI premium rates and maximums” page, modified 2025-09-16):

• Maximum insurable earnings: $68,900
• Employee premium rate: 1.63%
• Maximum annual employee premium: $1,123.07
• Maximum annual employer premium (1.4 times the employee rate): $1,572.30

The employer share is 1.4 times the employee premium, which is why the employer maximum is higher than the employee maximum. One point matters for planning: the rate does not only rise. The 2026 employee rate of 1.63% is actually lower than the 2025 rate of 1.64%, so each January’s figures should be treated as a fresh number to look up, not last year’s number plus an increase. (Quebec runs a separate program and has a different, lower EI rate — 1.30% in 2026 — but that is not generally relevant where employees work in Ontario.)

The common errors are leaving last year’s rate and last year’s cap in the payroll system after January 1, or assuming the figures always climb. Every number above goes stale on January 1, 2027, when the next year’s rate and maximum insurable earnings take effect. Before finalizing the first payroll of any year, confirm the current rate, the current maximum insurable earnings, and the current employee and employer maximums at the CRA “EI premium rates and maximums” page.

Source: Canada Revenue Agency, “EI premium rates and maximums” (page modified 2025-09-16). Confidence: verified.

How does the CRA decide how often an employer remits payroll deductions?

An employer does not choose its remittance frequency — the CRA assigns a remitter type from the employer’s Average Monthly Withholding Amount (AMWA), based on withholdings from the second preceding calendar year, and notifies the employer by mail. The CRA reviews and can change the type each year, so the schedule can move as a payroll grows or shrinks. The reliable way to confirm a specific type and due dates is the CRA notice or CRA My Business Account, not the published tiers.

An employer that runs payroll withholds CPP/CPP2, EI, and income tax from employees’ pay and remits those amounts to the CRA on a recurring schedule. Because the assignment is made per employer and the tier cutoffs change over time, the dollar tiers below are for orientation only — not a substitute for the employer’s own assigned schedule. They run from least to most frequent:

• Quarterly — generally available to new small employers, and to employers with an AMWA under $3,000 and a clean compliance history.
• Regular monthly — AMWA under $25,000.
• Accelerated threshold 1 — AMWA of $25,000 up to $99,999.99; remit twice a month.
• Accelerated threshold 2 — AMWA of $100,000 or more; remit up to four times a month, generally within three business days of payday.

As an illustration of how a due date works, a regular monthly remitter pays by the 15th of the month following the month in which the pay was made. Each type has its own period and deadline, and a due date that lands on a weekend or a CRA-recognized holiday moves to the next business day.

The recurring error is assuming the schedule is fixed. The CRA reviews the remitter type annually, so a growing payroll can push an employer into a more frequent tier — and a missed or short remittance can draw a penalty even when the total for the year is eventually paid. When the assigned type changes, the CRA notifies the employer by mail; the practice is to watch for that notice and update the remittance calendar before the new schedule takes effect. The amounts remitted also reset each January 1 as the CPP/CPP2 and EI rates and maximums change. The remitter tiers, thresholds, and due dates change; confirm the assigned remitter type and the current cutoffs and deadlines in CRA My Business Account or on the CRA “Remitting source deductions” page.

Source: Canada Revenue Agency, “Remitting source deductions”, and CRA My Business Account. Confidence: verified.

When is the T4 filing deadline, and who needs a T4 slip?

The T4 information return — the slips plus a summary — is due on the last day of February following the calendar year the slips cover, and that date shifts to the next business day if it lands on a weekend or a CRA-recognized holiday, so it is not a fixed calendar date. A T4 is required for an employee where the remuneration paid was more than $500, or where any CPP, EI, or income tax was deducted — even if the total was $500 or less.

Every year, the employer prepares T4 slips for employees, gives them their copies, and files the T4 information return with the CRA. Where the employer paid other kinds of remuneration that go on a T4A, those are prepared and filed too. This is a federal obligation that applies to payroll regardless of which employment-standards jurisdiction the employer falls under.

The filing is annual, and the deadline is the last day of February following the calendar year the slips cover. Because that day shifts for weekends and holidays, the exact date is not the same every year — it can be the 28th, the 29th in a leap year, or a Monday. The date should not be frozen into an employer’s own calendar; the current year’s exact filing deadline is confirmed with the CRA. Filing electronically is mandatory once an employer goes over a low slip-count threshold, so most employers above a handful of slips file online rather than on paper. The CRA sets and updates that threshold, so the current cutoff is confirmed with the CRA rather than assumed.

Two related obligations sit next to this one. Filing the T4 return is separate from sending the CRA the CPP, EI, and income tax withheld during the year — that is a recurring remittance on its own schedule (see Source-deduction remittances above). And the payroll information behind the slips has its own retention rules; for how long Ontario employers must keep payroll and related records, see Employer Record-Keeping Obligations.

The recurring errors are treating the deadline as a fixed calendar date and missing the weekend or holiday shift; skipping a slip for someone paid $500 or less while forgetting that any CPP, EI, or income tax deducted makes the slip mandatory; and assuming last year’s filing method still works when the electronic-filing threshold has changed. Confirm the current year’s exact filing date and thresholds in the CRA’s “Employers’ Guide – Filing the T4 Slip and Summary” (RC4120).

Source: Canada Revenue Agency, “Employers’ Guide – Filing the T4 Slip and Summary” (RC4120). Confidence: verified.

Why must these figures be re-verified every year?

The CPP/CPP2 and EI rates, maximums, and exemptions reset every January 1, announced the prior autumn, and almost every dollar figure on this page goes stale the following January. The remitter tier thresholds, the electronic-filing slip count, and the February filing date can all change as well. The January reset is not automatic, and payroll software does not transfer the obligation to confirm the current figures at the CRA source.

Concretely, the figures on this page were current as of January 1, 2026 and carry a staleness trigger of January 1, 2027: the CPP figures (modified 2025-10-31, announced 2025-10-30) and the EI figures (modified 2025-09-16) are both due to be replaced when the next year’s numbers take effect. The YMPE, the CPP2 second ceiling, the maximum insurable earnings, and the dollar maximums that flow from them typically move each January, and the contribution and premium rates can move in either direction — the 2026 EI employee rate of 1.63% is lower than the 2025 rate of 1.64%, so an increase cannot be assumed.

The practical discipline is to not freeze any rate, maximum, threshold, or filing date into a payroll template and assume it holds for the next year. Before the first payroll of any year, the current CPP and EI figures, the assigned remitter type and its cutoffs, the electronic-filing slip-count threshold, and the exact T4 filing date are each re-confirmed at the relevant CRA page of record. For volatile annual rates generally — including how these federal figures sit alongside Ontario’s own moving numbers — the live government source is always the authority; the minimum-wage current rates note and the Ontario employer compliance calendar track the recurring dates and rates in one place.

This page was last reviewed against its sources on 2026-06-08. Confidence: verified, single-source (CRA).

---

This page is general information about federal payroll obligations, not legal or tax advice. The rates, maximums, thresholds, remitter tiers, and filing dates above change — most of them reset every January 1 — so confirm the current year’s figures and effective dates at the CRA pages linked above before relying on any of them.