If you are using a payroll provider like ADP or Ceridian, you do not have to read any further, as their software will watch for the maximum contributions being deducted for CPP and EI.
However, if your payroll is prepared in-house, I always like to give this reminder mid-year. To help prevent your firm from over-paying CRA on payroll remittances, please review employees who receive an annual salary of more than $45,900.00.
There is a yearly maximum that can be deducted for CPP and EI, which was set by CRA in January 2012. Maximum Earnings for CPP is $50,100.00, with a maximum contribution of $2306.70 (or $4613.40, if you are self-employed). Maximum Earnings for EI is $45,900.00, with a maximum contribution of $839.97. Also, be aware that should the government decide to make changes to the payroll tax system, it will always take effect on January 1st and July 1st. Be alert to any changes with regard to your provincial or federal payroll tax rules.
More information can be found through CRA’s website. Here’s the link to the relevant online payroll section: CRA’s Payroll information
For those clients using the Simply Steadfast … Easy Entry Payroll Workbook, you will note the reminders in July and November on each employee’s payroll page. This is another helpful way to prevent over-deductions on employee’s pay cheques. If you are doing manual payroll and wish to learn about the ease of completing payroll remittances using this Workbook, please contact me. The year-end PIER review and T4s are also easily completed within this workbook.