Common Questions About Canadian Payroll

CPP contributions depend on your employee’s pensionable earnings and the current contribution rate (5.95% for 2024, split between employer and employee). The maximum pensionable earnings cap is $68,500, so contributions max out once an employee hits that threshold. We verify these against Service Canada’s current rates and your provincial requirements to ensure you’re not over- or under-contributing.

CPP (Canada Pension Plan) is a retirement savings program that builds benefits for when your employees turn 60+. EI (Employment Insurance) provides temporary income support if someone loses their job or needs parental leave. They’re calculated differently, have different maximums, and serve completely different purposes—CPP is long-term security, EI is short-term protection.

Yes, if you paid an employee any amount during the calendar year, you’re required to issue a T4 slip by February 28th (or March 15th if filed electronically). You’ll also file a T4 Summary with the CRA. Even if someone earned less than $1,000, they still get a T4—it’s about reporting all employment income.

The CRA takes this seriously. You’re required to remit within 15 days of month-end (or the last business day of that window). Missing a deadline triggers penalties and interest charges that compound quickly. If you’re a larger employer, you might have stricter deadlines—some need to remit mid-month. When in doubt, we help you build a compliance calendar so nothing slips through.

For CPP and EI purposes, yes—commissions and bonuses are pensionable and insurable earnings, so you deduct CPP and EI the same way. However, they’re often paid on different schedules, which can affect your remittance timeline. The key is tracking when they’re earned versus when they’re paid, because that determines which payroll period they belong to.

Each province has its own income tax brackets and rates, so an employee earning $50,000 in Ontario pays different provincial tax than one in BC. You also need to file provincial remittances separately from federal. EI rates also vary by province (ranging from 1.58% to 1.66% for 2024). Getting your provincial setup right from day one prevents compliance headaches and audit risk.