Canadians may notice a decrease on their paycheques beginning in January 2021.
The maximum pensionable earnings under the Canada Pension Plan (CPP) for 2021 will be $61,600.
Contributors who earn more than $61,600 in 2021 are not required or permitted to make additional contributions to the CPP.
The basic exemption amount for 2021 remains at $3,500.
The employee and employer contribution rates for 2021 will be 5.45%, and the self-employed contribution rate will be 10.9%. The increase in contribution rate is due to the continued implementation of the CPP enhancement.
The Canada Employment Insurance Commission has set the 2021 Employment Insurance (EI) premium rate at $1.58 per $100 of insurable earnings for employees and $2.21 for employers who pay 1.4 times the employee rate, which is unchanged from the 2020 premium rate.
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