How to Use the Canadian Payroll Deductions Calculator

Before You Start

• Have the employee's gross pay amount for the current period ready.
• Know your pay frequency (bi-weekly, weekly, semi-monthly, or monthly).
• If mid-year, gather year-to-date CPP and EI already deducted so maximums are applied correctly.
• Quebec employees: results use CRA-equivalent QPP/QPIP rates — verify remittances with Revenu Québec WebRAS.

Step-by-Step

1. Select province and pay frequency: Choose the province where the employee works and how often you pay. This determines which provincial tax rates and the per-period CPP exemption apply.
2. Enter gross pay: Enter the employee's total earnings for this pay period before any deductions.
3. Enter year-to-date CPP and EI already deducted: If this is not the first pay period of the year, enter what has already been deducted. This prevents over-deducting once the annual maximums are reached.
4. Add any extra withholding: If the employee has requested additional tax withholding on their TD1, enter that amount here.
5. Review results: Check the employee deductions panel, employer cost panel, and the annualized table to plan remittances.

How to Read the Output

• Net pay is what the employee takes home. Total deductions include CPP/EI and both federal and provincial income tax.
• The employer cost panel shows your total payroll cost — gross pay plus the employer's matching CPP and EI shares.
• CPP2 applies to earnings between $71,300 and $81,200 (2025 YMPE/YAMPE). Most employees below that threshold will show $0 for CPP2.
• Verify all remittances with the CRA Payroll Deductions Online Calculator (PDOC) before filing.

Common Mistakes to Avoid

• Forgetting to enter year-to-date CPP/EI, which causes the calculator to over-deduct near year-end.
• Using provincial employee rates for the employer's EI share — the employer pays 1.4× the employee rate.
• Assuming Quebec uses the same CPP rates — Quebec employees contribute to QPP (slightly higher rate) and QPIP instead.