Starting in 2019, the Federal Government will be making changes to the Canada Pension Plan (CPP) to increase future retirement, disability and survivor pensions.
From 2019 to 2023, the CPP contribution rate for employees and employers will gradually increase by 1% (from 4.95% to 5.95%) on earnings between $3,500 and the annual maximum limit. The maximum limit used to determine average work earnings will also increase by 14% by 2025.
In2019, the CPP contribution rate will be 5.10% for employees and employers and the maximum annual limit will increase to $57,400. The contribution increase will appear on the first paycheque in January 2019.
In 2024, employees and employers will begin contributing 4% each on any additional range of earnings. This range will start at the original annual maximum limit (estimated to be $69,400 in 2025) and go to an additional earnings limit (estimated to be $79,400 in 2025). This additional range will only affect you in years when your annual earnings are above the original earnings limit.
If you have questions on how these changes in the employer-paid portion of CPP will impact your department’s budget, please speak with the finance lead in your unit.
For more information about these CPP enhancements, visit the Government of Canada resources: