Employer's Responsibility to Collect CPP or QPP Contributions
CPP or QPP Post-Retirement Benefit
Employer and Self-Employed CPP or QPP Contributions
When Are Contributions Deducted by Employers?
On What Income Are CPP and QPP Contributions Payable?
Election to Stop Contributing to the CPP
Election to Stop Contributing to the QPP
Electing to Pay Additional CPP Contributions
CPP Contributions on the T4 Slip
CPP and QPP Calculations in the TaxTips.ca Calculators
Pensionable Earnings and Annual Exemption
Executor, Liquidator or Administrator Fees
Revenue Quebec re Employment Not Subject to QPP
Underpaid CPP or QPP Contributions
Retired Partner Payments Non-Pensionable
CPP Contribution Calculation for Combined Employment and Self-Employment Income
Self-Employed Contractor, or Employee?
Where No Tax Return Filed Within 4 Years - Self-Employed
Canada Revenue Agency (CRA) Resources
CPP contributions are paid only by those who are age 18 to 69.
Employers in all provinces except Quebec, where Quebec Pension Plan (QPP) contributions are collected, are responsible for deducting Canada Pension Plan (CPP) contributions from employees who are 18 to 69 years old, unless:
QPP contributions must be deducted from employees in Quebec for all workers who are over 18 even if they are in one of the following situations:
As of 2024, wages paid and earnings received by workers age 73 and older will no longer be subject to QPP contributions. This was announced as part of the March 21, 2023 Budget.
There are no CPP or QPP contributions for the first $3,500 of employment income. This is the annual exemption amount
Note that if the employee is over 65, receiving a CPP or QPP retirement pension, and has not elected to stop making CPP or QPP contributions, the contributions made will result in a post-retirement benefit, even for persons receiving the maximum pension already.
The employer pays the same CPP or QPP contribution as the employee. Self-employed people must pay both the employee and employer portions of CPP contributions. The amount payable is calculated on the self-employed person's personal income tax return. See our article regarding the changes to CPP rules, which includes information on changes to CPP retirement pension. These changes started in 2012, and are reflected below.
CPP or QPP contributions are deducted by employers starting in the month following the employee's 18th birthday. CPP contributions are no longer deducted beginning in the month following the employee's 70th birthday, or the month following the employer's receipt of a CPT30 form from the employee. QPP contributions are no longer deducted beginning in the month following the employee's 73rd birthday, or the month following the employer's receipt of an RR-50-V form from the employee.
CPP or QPP contributions are payable on employment and self-employment income, even if a CPP or QPP retirement pension is being received (since 2012).
If a recipient of the CPP retirement pension is 65 to 70 years old, they can elect to stop making further contributions to the CPP, by completing form CPT30 from CRA. Once the form is completed, a copy must be given to the employer, and the original sent to CRA. This election can be revoked by completing form CPT30 again, but not until the following calendar year. The election or revocation takes effect on the first day of the month following the date that the form is given to the employer.
If you have only self-employment earnings, there is no need to complete this form. Instead, you will complete Schedule 8, CPP Contributions on Self-employment and Other Earnings, with your tax return.
The election to stop contributing to the QPP does not apply in the same way to the Canada Pension Plan (CPP). For tax years prior to 2024, QPP contributions must be paid even if you are in one of the following situations:
As of January 1, 2024, workers age 65 or older can elect to stop contributing to the CPP if they are receiving a CPP or QPP retirement pension. Employees can make this election using form RR-50-V. The completed form must be given to the employer and to Revenu Quebec. If you have only self-employment earnings, there is no need to complete this form. Instead, you will make the election when you file your tax return for the year.
On January 1 of each year, workers who turned 72 at the end of the previous year will automatically stop contributing to the QPP.
See Changes made to the Quebec Pension Plan on the Quebec website.
Taxpayers can also elect to pay CPP contributions on certain types of employment income from which CPP contributions were not withheld. This is done by completing form CPT20, Election to Pay Canada Pension Plan Contributions, which is a form included in income tax return software. The types of employment income for which additional CPP contributions can be made are listed on the form.
When only a part of the employee's earnings during the year are subject to CPP contributions, the employer will report the amount of pensionable earnings on the employee's T4. Otherwise, box 26 of the T4, which is for CPP pensionable earnings, is left blank.
When using the Canadian Tax Calculator or the Quebec Tax Calculator, if only a part of your total employment earnings are considered pensionable earnings, you must answer N to the question "Are you required to pay CPP contributions on ALL the above earnings (up to annual max)?", and enter the pensionable amount of your earnings in the area provided. If you have turned 18 or 70 (73 starting 2024 in QC) in the year, you must enter your birth month near the top of the calculator. This is used to calculate the reduced annual exemption for your CPP or QPP pensionable earnings, which is $3,500 for a full year.
For self-employment earnings when you have turned 18 or 70 in the year, or have elected to stop making CPP contributions, the pensionable earnings are prorated based on the number of months:
divided by 12.
For example:
The TaxTips.ca Tax Calculators will automatically calculate the pensionable amount for those turning 18 or 70 in the year, based on the birth month. When the user inputs a number of months for which they have elected to not contribute, that will be used to calculate the pensionable self-employment earnings, for taxpayers who are 65 to 70. The number of months elected cannot exceed the number of months collecting CPP retirement pension.
The rules for employers in Quebec, who must deduct Quebec Pension Plan (QPP) contributions instead of CPP contributions, are generally the same as for other provinces, except that QPP contributions must be withheld from employees even if the employee is 70 or over, until December 31st.
As of January 1, 2024, workers age 65 or older can elect to stop contributing to the CPP if they are receiving a CPP or QPP retirement pension. Employees can make this election using form RR-50-V. The completed form must be given to the employer and to Revenu Quebec.
As of 2024, wages paid and earnings received by workers age 73 and older will no longer be subject to QPP contributions. This was announced as part of the March 21, 2023 Budget.
When executor, liquidator, or administrator fees are being paid out of an estate, the estate must register as an employer with Canada Revenue Agency (CRA). This is the responsibility of the executor. All applicable income tax and Canada Pension Plan or Quebec Pension Plan contributions must be withheld from the payment, but employment insurance premiums do not apply. This only applies if the executor, liquidator, or administrator does not act in this capacity in the regular course of business.
There are some types of employment payments and other payments from which CPP or QPP contributions do not have to be deducted. CRA information on what type of payments are and are not subject to CPP, EI or tax deductions is available in their Special Payments Chart.
TP-1015.G-V - Guide for Employers: Source Deductions and Contributions, section 6.3.
If a person has more than one employer in the year and earns total employment income which is less than the maximum pensionable earnings, this will have the result that the basic exemption used to withhold CPP or QPP contributions is more than $3,500.
There is no obligation to remit the shortfall in contributions, but if desired, this can be done, as described in the following paragraph.
A person can elect to pay Canada Pension Plan contributions on certain types of income from which CPP contributions have not been deducted. This can be done by an election using form CPT20 if the person is:
CRA also has a section titled CPP/EI Explained, which talks about different types of earnings and how they are treated for CPP and EI purposes. It includes information on
Retired partner payments were determined to be non-pensionable by the Federal Court of Appeal in Freitas v. Canada, 2018 FCA 110. This was in relation to income allocated to a retired partner for any year after the year during which that person has ceased to be a partner. The judge ruled that "In order for the income allocated to Mr. Freitas to be considered to be his self-employed earnings it would have to be income from a business that was carried on by him." Since he had ceased to be a member of the partnership, he was not carrying on a business.
Since self-employment income does not have CPP contributions deducted at source (usually), the amount of the contribution is calculated on the tax return. Some people may have both employment and self-employment earnings.
When a person has both employment and self-employment earnings, the total CPP or QPP contribution paid will be based on total employment plus self-employment earnings. See the following example of the calculation, for 2022, as it would be calculated on Schedule 8 of the personal tax return.
| Pensionable net self-employment earnings (zero if a loss) | $20,000 | ||
| Employment earnings not shown on a T4 slip on which you elect to pay additional CPP contributions | nil | ||
| Subtotal (zero if negative) | $20,000 | ||
| Pensionable employment earnings from T4 | 30,000 | ||
| Total pensionable earnings (max $64,900) | $50,000 | ||
| Less basic exemption | -3,500 | ||
| Earnings subject to contribution (maximum $50,000 - 3,500 = $46,500) | $46,500 | ||
| CPP contributions @5.7% x 2 = 11.4% | 5,301 | ||
| Less contributions paid through employment (from T4) | $1,510.50 | x2 = | -3,021 |
| Contributions payable on self-employment and other earnings (zero if negative) | $2,280 | ||
The taxpayer would have to remit $2,280.00 of CPP contributions along with taxes payable.
When the tax return is filed, a non-refundable tax credit is calculated based on CPP contributions paid. The non-refundable tax credit would be allowed based on
The other 50% of CPP on self-employment earnings, or $1,140, is allowed as a deduction from income. This deduction is the employer portion of the CPP contribution.
When self-employment earnings are a loss, they are not included in the CPP calculation.
Sometimes Canada Revenue Agency (CRA) will rule that someone who has been treated as an independent self-employed contractor is actually an employee. When there is any doubt about whether a payee is a contractor or employee (see Employee vs Self-Employed Contractor), a ruling should be obtained. However, CRA is sometimes overturned by the Tax Court. For a surprising Tax Court Case regarding employees vs self-employed contractors, where CRA was overturned, see Big Bird Trucking Inc. V. M.N.R., 2015 TCC 340.
Section 30(5) of the Canada Pension Plan Act stipulates that the amount of CPP contribution required to be made for self-employed earnings for the year is deemed to be zero where
(a) the return of those earnings required by this section to be filed with the Minister is not filed with the Minister before the day that is four years after the day on or before which the return is required by subsection (1) to be filed; and
(b) the Minister does not assess the contribution before the end of those four years.
For instance, if a taxpayer did not file their tax return for 2013 until August 2018 (more than 4 years after the due date of June 15, 2014), they would not remit CPP contributions on the self-employment earnings. Note that the contributory earnings are not deemed to be zero, just the contribution payable. However, sections 77 and 78 of the CPP Act provide for the CPP benefit amount to be reduced when no contributions have been made on some of the contributory or pensionable earnings.
When the taxpayer files the return after the 4 year limit that is stipulated by the CPP Act, if Schedule 8 is completed including CPP contributions on those earnings, CRA will reassess the return to eliminate the CPP on self-employed earnings.
Section 35(1) of the Canada Pension Plan Act assesses penalties for failure to file a return of self-employed earnings, in the amount of 5% of the part of the amount of the contributions required to be made by the person for the year in respect of the contributions that remained unpaid at the expiration of the time the return was required to be filed. The penalty may be reduced if the person is subject to a penalty under s. 162(1) or (2) of the Income Tax Act for failure to file a return. See our article on Late Filing of a Tax Return.
Thanks to a reader for asking about this, and to Hugh Nielson FCPA FCA TEP for pointing me to the appropriate sections of the CPP Act in order to clarify this.
CPP/QPP contribution rates and maximum pensionable earnings
Tips and Gratuities - GST/HST, CPP and EI
Changes made to the Quebec Pension Plan
Employee Contribution to the Quebec Pension Plan
QPP Contributions Payable by a Self-employed Person or a Member of a Partnership
T4001 Employers' Guide - Payroll Deductions and Remittances - see Amounts and benefits from which you have to deduct CPP contributions, and Employment, benefits and payments from which you do not have to deduct CPP Contributions.
Taxable benefits and allowances source deductions
Revised: October 07, 2025