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In 2019, the contribution rate will increase to 5.1%
The phasing of the two-year upper earnings limit begin in 2024. That year, the yearly maximum pensionable earnings threshold will be an estimated be $70,100, while the upper earnings limit will be $74,900. The $4,800 difference will be subject to a separate contribution rate of four per cent for both employees and employers.
Read: Ottawa, Ontario review costs from CPP expansion
In 2025, the yearly maximum pensionable earnings threshold will be $72,500, and upper earnings limit will move to $82,700. Again, the difference — $10,000 — will be subject to a four per cent contribution rate.
Both employee and employer contributions to the CPP enhancement will be tax-deductible.
The provinces and territories will be able to make their own changes to the working income tax benefit “to better harmonize with their own programs,” according to Finance Canada.
This article was originally published on Benefits Canada.
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