Deducting CPP Contributions The Canada Pension Plan (CPP) came into effect in 1966 as a way to provide financial assistance to Canadians when they retire from the workforce. Every person who works in Canada is eligible to get benefits when he or she retires. Both employees and employers contribute to the CPP. But you, as an employer, are responsible both for deducting CPP contributions from your employees' paycheques and for matching those contributions yourself. Failure to deduct and make these contributions can make the employer subject to penalties and interest. Employees fall into many different categories, which determine how and when you should deduct CPP. To deduct CPP contributions, you consult the Payroll Deductions Tables which are issued by Canada Revenue Agency (CRA). These tables tell you how much CPP to deduct from your employees' paycheques, depending on their salaries and pay periods. The rates for CPP deductions may vary from year to year. Each edition of the Payroll Tables gives information on current rates. Make sure you have an up to date edition. Remember you must match each employee's contribution. For example, if you deduct $100 from an employee's paycheque, you must also contribute $100. You must then send $200 for that employee to CRA. Legal Notice And Disclaimer Privacy Statement | 
