CPP / QPP contributions

Canada Pension Plan (CPP) is a national insurance program that provides income for Canadians when they retire or if they become disabled. The Quebec Pension Plan (QPP) fulfills the same role in that province.

Employers are required by law to deduct CPP/QPP contributions from their employees' pay and to provide a matching contribution when the employee is in pensionable employment during the year.

CPP contributions

Working Canadians (outside Quebec) between the ages of 18 and 70 must contribute to the CPP unless they receive a disability pension from the plan or are exempt for another reason. Start deducting CPP contributions with the first pay dated in the month after the employee turns 18 and stop deducting with the first pay in the month after the employee turns 70.

  • If an employee aged 65 or older files a CPT30 form with CRA and provides the employer with a copy, CPP contributions can stop before the employee turns 70. If a CPT30 form is not filed, CPP contributions continue until the month following the employee turns 70.

  • An employee can only stop or start their CPP contributions using a CPT30 once per calendar year. The same form is used to stop or restart contributions.

Prorated CPP maximum

The CPP maximum is prorated for employees turning 18 or 70 during the year based on their birthdate.

Second additional CPP contributions (CPP2)

In January 2024, CPP enhancements introduced a 4% second additional contribution on pensionable earnings between $68,500 and $73,200. Pensionable earnings between the Year’s Maximum Pensionable Earnings (YMPE) and a second earnings ceiling, referred to as the Year’s Additional Maximum Pensionable Earnings (YAMPE), are subject to CPP2 contributions. More information can be found at CPP.

Tasks

You must change the employee’s CPP status on the Employee Profile page.Closed From the Payroll menu, select Hire/Profile > Employee Profile.:

  • to Subject to CPP/QPP in the month after the employee’s 18th birthday

    Note: If the exemption status is not changed at the correct time, an adjustment is required. See Employee CPP/QPP status not changed at the correct time.

  • to Exempt from CPP/QPP in the month after the employee’s 70th birthday

    Note: If the exemption status is not changed at the correct time, an adjustment is required. See Employee CPP/QPP status not changed at the correct time.

  • to Exempt from CPP/QPP if informed by the employee they have filed a CPT30 election to stop CPP contributions with CRA

When to deduct CPP

Description Under 18 18 to 59 60 to 64 65 to 69 70 and over
If not disabled and not receiving CPP retirement pension N Y N
If considered disabled under CPP N
If in receipt of CPP retirement pension N/A N/A Y Y* N

*Unless the employee has filed a CPT30 election to stop CPP contributions with CRA and the employer.

Note: The employee’s tax form should not display exempt for CPP if they did not contribute during the year due to the completion of the CPT30 form. This is consistent with CRA guidance. If the employee's name appears on a PIER report, you must explain that the employee provided you with a CPT30.

For more information visit CRA at https://www.canada.ca/en/revenue-agency.html and search for CPP changes.

QPP contributions

Working Canadians(in Quebec) between the ages of 18 and 72 must contribute to the QPP unless they receive a disability pension from the plan or are exempt for another reason. Start deducting QPP contributions with the first pay dated in the month after the employee turns 18 and stop deducting by December 31 of the year the employee turns 72.

  • If an employee aged 65 or older files a RR–50-V form with Revenu Québec and provides the employer with a copy, QPP contributions can stop before December 31 of the year the employee turns 72.

  • QPP contributions cannot be deducted after December 31 of the year the employee turns 72.

  • An employee can only stop or start their QPP contributions using a RR-50-V once per calendar year. The same form is used to stop or restart contributions.

Prorated QPP maximum

The QPP maximum is prorated for employees turning 18 during the year based on their birthdate.

Second additional QPP contributions (QPP2)

In January 2024, QPP enhancements introduced a 4% second additional contribution on pensionable earnings between $68,500 and $73,200. Pensionable earnings between the Year’s Maximum Pensionable Earnings (YMPE) and a second earnings ceiling, referred to as the Year’s Additional Maximum Pensionable Earnings (YAMPE), are subject to QPP2 contributions. More information can be found at QPP.

Tasks

You must change the employee’s QPP status on the Employee Profile page.Closed From the Payroll menu, select Hire/Profile > Employee Profile.

  • to Subject to CPP/QPP in the month after the employee’s 18th birthday

    Note: If the exemption status is not changed at the correct time, an adjustment is required. See Employee CPP/QPP status not changed at the correct time.

  • to Exempt from CPP/QPP if informed by the employee they have filed a RR-50-V election to stop QPP contributions with Revenu Quebec.

  • to Exempt from CPP/QPP with pay period one of the year the employee turns 73.

When to deduct QPP

Description Under 18 18 to 59 60 to 64 65 to 721

January of the year the employee turns 73
If not disabled and not receiving QPP retirement pension N Y N
If considered disabled under QPP N
If in receipt of QPP retirement pension N/A N/A Y Y2 N
If in receipt of QPP disability pension and QPP retirement pension N N Y3 N N

1 Employees who are 72 as of December 31 stop contributing to QPP as of January 1 of the new year. (Contributions stop with the first pay of the year the employee turns 73.) Employees who are 72 as of January 1 continue to contribute to QPP for the full year.

2 Unless the employee has filed a RR-50-V election to stop QPP contributions with Revenu Quebec and the employer.

3 Effective January 1, 2024, employees who are 60 or older and receive both a QPP disability pension and QPP retirement pension must make QPP contributions unless they opt out at age 65.

Note: The employee’s tax form should not display exempt for QPP if they did not contribute during the year due to the completion of the RR-50-V form. This is consistent with Revenu Quebec guidance. If the employee's name appears on a PIER report, you must explain that the employee provided you with a RR-50-V.

For more information about QPP and how it works for an employee, visit https://www.rrq.gouv.qc.ca/en/programmes/regime_rentes/Pages/regime_rentes.aspx

See also