Question 1

What is the difference between CPP and QPP in Canada?

Accepted Answer

CPP (Canada Pension Plan) applies to employees in all provinces and territories except Quebec, which operates its own Quebec Pension Plan (QPP). Both require equal contributions from employee and employer. The CPP/QPP contribution rate is 5.95% each (2024), applied to pensionable earnings between the basic exemption ($3,500) and the maximum pensionable earnings. CPP2 adds an additional tier above the first ceiling.

Question 2

How are Canadian payslips affected by provincial differences?

Accepted Answer

Provincial income tax rates and brackets differ significantly across Canada. Quebec has the highest provincial tax rates and also administers its own pension plan (QPP) and parental insurance plan (QPIP), resulting in different deduction lines. Some provinces like Alberta have flat tax rates, while others use progressive brackets. Provincial health premium levies (e.g. Ontario Health Premium) may also appear.

Question 3

What is Employment Insurance (EI) on a Canadian payslip?

Accepted Answer

Employment Insurance (EI) premiums fund benefits for unemployed workers. Employees contribute 1.66% of insurable earnings (2024 rate) up to an annual maximum. Employers pay 1.4 times the employee rate. In Quebec, the rate is lower because the province runs its own parental insurance plan (QPIP). EI deductions stop once the annual maximum insurable earnings cap is reached.

Payslip Generator for
Canada

Payroll Regulations in Canada

Common Deductions in Canada

CleverSlip Features for Canada

Frequently Asked Questions

Ready to create payslips for Canada?