CPP, QPP, and EI deductions in 2026

What CPP is and why it comes off your pay

The Canada Pension Plan is the country's public retirement pension for workers outside Quebec. Almost every employee aged 18 to 70 contributes, and your employer matches your contribution dollar for dollar. The money funds retirement pensions as well as disability and survivor benefits. If you are self-employed, there is no employer to split the bill, so you pay both halves yourself.

The 2026 CPP numbers

In 2026 you contribute 5.95% of your earnings between $3,500 and $74,600. The most you can contribute in the year is $4,646.45, and your employer pays the same amount on your behalf. These are the exact figures our calculator uses, so what you read here will match what it estimates.

The $3,500 exemption

The first $3,500 you earn each year is exempt from CPP contributions. It exists so that small or very short-term earnings are not nickeled away by pension deductions. In practice, contributions are calculated on your earnings minus $3,500, up to the yearly maximum.

The second CPP tier: CPP2

Since 2024 there has been a second tier. Earnings from $74,600 to $85,000 face an extra 4% contribution, worth at most $416 a year. The second tier builds a slightly larger retirement benefit for middle earners, and it phases in fully over a few years. Our calculator includes it automatically, so you do not need to do the two-tier math yourself.

QPP: the Quebec version

If you work in Quebec, you contribute to the Quebec Pension Plan instead of CPP. The structure mirrors CPP: a 6.3% rate on the same $3,500 to $74,600 band, plus the 4% second tier up to $85,000, for a yearly maximum of $4,895.30. Only the rate and the maximum differ.

Why your late-year paycheques get bigger

CPP contributions stop the moment you hit the yearly maximum. Someone earning $100,000 reaches $85,000 in pensionable earnings about 85% of the way through the year, which means the last few biweekly paycheques arrive with no CPP line at all, worth roughly an extra $375 per pay. If your November or December paycheque looks unusually generous, this is usually why. The same stop-when-full mechanic applies to EI, which is why the effect can feel dramatic in the final pays of the year.

EI premiums in 2026

Employment Insurance is the program that pays benefits if you lose your job through no fault of your own, and it also funds parental and other special benefits. In 2026 you pay 1.63% of your insurable earnings up to $68,900, for a yearly maximum of $1,123.07. Your employer pays 1.4 times your rate, which works out to $2.28 per $100 of insurable earnings. In Quebec the employee rate is 1.3%, for a maximum of $895.70, because the province runs its own parental insurance plan and the federal rate is reduced to account for it. Most employees are covered automatically. Self-employed workers can opt into EI for special benefits such as parental leave, though regular job-loss benefits are not included.

Pre-tax deductions do not shrink CPP or EI

RRSP contributions and pension plan deductions lower the income your income tax is calculated on, but CPP and EI are calculated on your full earnings before those deductions. Only income tax gets the discount. This is a common source of confusion: maxing out your RRSP will shrink the tax lines on your stub, but the CPP and EI lines will not budge.

A worked example: CPP and EI on a $65,000 salary

Take an Ontario employee earning $65,000 in 2026. CPP applies to earnings minus the $3,500 exemption: $61,500 at 5.95% is $3,659.25 for the year. The salary sits below $74,600, so the second tier does not kick in. EI is 1.63% of the full $65,000, which is $1,059.50. Total payroll contributions: $4,718.75, all matched or exceeded by the employer behind the scenes: the employer contributes the same $3,659.25 to CPP and pays EI at 1.4 times the employee rate, or $1,482.00. Your stub never shows the employer half, but it is part of your total compensation.

Two jobs, overcontributions, and refunds

Each employer withholds CPP and EI independently, without knowing about your other job. If your combined earnings push you past the yearly maximums, you will overcontribute during the year. The fix happens at tax time: excess CPP and EI are calculated on your return and refunded to you. You do not need to warn either employer; the system reconciles itself every spring.

Do contributions affect your future pension?

Yes, and that is the point. CPP retirement benefits are based on how much you contributed and for how long. Higher earnings up to the yearly maximum build a larger pension, which is one reason the second tier was added. EI works differently: premiums buy insurance coverage, not a bigger future payout. Paying the maximum does not increase your benefit rate; it just means you have contributed all the program asks for the year.

See the numbers on your own pay