If you run payroll in Ontario, three numbers changed on 1 January 2026. The maximum CPP contribution is now $4,230.45, CPP2 adds $416 on top of that, and the maximum EI premium is $1,123.07. Here is every 2026 figure, and what each one costs you per employee.
Every figure below was confirmed against the Canada Revenue Agency on 1 August 2026.
Key takeaways
- The 2026 CPP maximum pensionable earnings (YMPE) is $74,600, with a basic exemption of $3,500 and a contribution rate of 5.95%.
- The maximum CPP contribution for 2026 is $4,230.45 each for the employee and the employer, plus $416 in CPP2 contributions, for a combined maximum of $4,646.45 per side.
- The 2026 EI maximum insurable earnings is $68,900 at an employee rate of 1.63%, giving a maximum EI premium of $1,123.07 for the employee and $1,572.30 for the employer.
- An employee at both ceilings pays $5,769.52 in CPP and EI deductions in 2026. Their employer pays $6,218.75.
- The EI rate went down for 2026 (1.64% to 1.63%) but the maximum premium still went up, because the earnings ceiling rose by $3,200.
CPP and EI max 2026 at a glance
Three things come off a Canadian paycheque before net pay: CPP, EI and income tax. The first two are capped. Once an employee hits the annual maximum, you stop deducting for the rest of the year. Here are the 2026 maximum contributions on both sides.
| 2026 maximum | Employee | Employer |
|---|---|---|
| CPP (base) | $4,230.45 | $4,230.45 |
| CPP2 | $416.00 | $416.00 |
| CPP total | $4,646.45 | $4,646.45 |
| EI premium | $1,123.07 | $1,572.30 |
| Combined total | $5,769.52 | $6,218.75 |
CPP contribution rates and maximums for 2026
CPP contributions are calculated on pensionable earnings between the basic exemption and the year's maximum pensionable earnings, or YMPE. The exemption is the first slice of income you do not deduct CPP on. The YMPE is the ceiling where base CPP contributions stop.
| CPP contribution rates | 2026 | 2025 |
|---|---|---|
| Maximum pensionable earnings (YMPE) | $74,600 | $71,300 |
| Basic exemption amount | $3,500 | $3,500 |
| Maximum contributory earnings | $71,100 | $67,800 |
| Employee and employer contribution rate | 5.95% | 5.95% |
| Maximum annual contribution, each side | $4,230.45 | $4,034.10 |
| Maximum annual self-employed contribution | $8,460.90 | $8,068.20 |
The rate has not moved. The maximum CPP contribution rose because the YMPE went up by $3,300. You can confirm all of these figures on the CRA's CPP contribution rates, maximums and exemptions page.
The CPP basic exemption by pay period
You do not apply the full $3,500 exemption in one go. You apply a slice of it each pay period, which is where most payroll deduction errors start.
| Pay period | 2026 basic exemption amount |
|---|---|
| Weekly (52) | $67.30 |
| Bi-weekly (26) | $134.61 |
| Semi-monthly (24) | $145.83 |
| Monthly (12) | $291.66 |
CPP2 2026: the second additional CPP contribution
CPP2 is a second additional CPP contribution that started in 2024. It applies to earnings above the YMPE, up to a second ceiling called the year's additional maximum pensionable earnings, or YAMPE. It is a separate deduction with its own rate and its own maximum, and it catches employers who assume CPP simply stops at the YMPE.
| CPP2 contribution rates | 2026 | 2025 |
|---|---|---|
| Additional maximum pensionable earnings (YAMPE) | $85,000 | $81,200 |
| Employee and employer contribution rate | 4% | 4% |
| Maximum annual contribution, each side | $416.00 | $396.00 |
| Maximum annual self-employed contribution | $832.00 | $792.00 |
The 2026 CPP2 band runs from $74,600 to $85,000, a spread of $10,400. At 4%, that produces the $416 maximum. An employee earning $80,000 in Oshawa pays CPP2 on $5,400 of income, or $216, on top of their maximum base CPP contribution. The CRA sets this out on its CPP2 rates and maximums page.
EI premium rates and maximums for 2026
EI premiums work differently from CPP. There is no exemption, so you deduct from the first dollar. The employee rate applies to all insurable earnings up to the maximum insurable earnings, and the employer pays 1.4 times whatever the employee pays.
| EI premium rates (outside Quebec) | 2026 | 2025 |
|---|---|---|
| Maximum insurable earnings | $68,900 | $65,700 |
| Employee rate | 1.63% | 1.64% |
| Maximum annual employee premium | $1,123.07 | $1,077.48 |
| Maximum annual employer premium | $1,572.30 | $1,508.47 |
The employee EI rate fell by one basis point for 2026. The maximum EI contribution still rose by $45.59, because the ceiling climbed $3,200. The ceiling rose faster than the rate fell, so the maximum went up anyway, which is the part that catches people out. The full history is on the CRA's EI premium rates and maximums page.
Quebec EI rates for 2026
Quebec administers its own maternity and parental benefits, so Quebec employees pay a lower federal EI rate. If you have staff in Quebec, these are the figures that apply to them: maximum insurable earnings of $68,900, an employee rate of 1.30%, a maximum employee premium of $895.70 and a maximum employer premium of $1,253.98.
How to calculate CPP and EI deductions per pay period
Take an employee in Ajax on a $72,000 salary, paid semi-monthly. That is $3,000 per cheque, 24 times a year.
Worked example: $3,000 semi-monthly
- CPP: subtract the semi-monthly exemption first. $3,000 less $145.83 is $2,854.17. At 5.95%, the CPP contribution is $169.82.
- EI: no exemption, so apply 1.63% to the full $3,000, which is $48.90.
- The employer matches the $169.82 in CPP and pays 1.4 times the EI, or $68.46.
This employee never reaches the YMPE, so no CPP2 comes off at any point in the year. Someone earning more than $74,600 crosses into the CPP2 band partway through and a second deduction starts, which is the moment payroll software set up before 2024 tends to get it wrong.
What CPP and EI cost a Durham employer in 2026
Take a Whitby contractor with four employees, each earning above $85,000. Every one of them maxes out both CPP ceilings and the EI ceiling.
| Employer cost per employee at the maximum | 2026 | 2025 |
|---|---|---|
| CPP (base) | $4,230.45 | $4,034.10 |
| CPP2 | $416.00 | $396.00 |
| EI premium | $1,572.30 | $1,508.47 |
| Total per employee | $6,218.75 | $5,938.57 |
| Total for four employees | $24,875.00 | $23,754.28 |
The 2026 payroll deductions cost this Whitby employer $1,120.72 more than 2025 for the same four people on the same salaries. Nobody got a raise. The ceilings moved. That is the number worth building into your cash flow forecast in January rather than discovering in December, and it is the kind of thing a year-round payroll and bookkeeping relationship catches before it becomes a surprise.
Self-employed CPP contributions in 2026
If you are self-employed in Bowmanville or anywhere else in Durham Region, you pay both halves. The maximum self-employed CPP contribution for 2026 is $8,460.90 in base contributions plus $832 in CPP2, for a total of $9,292.90. You claim part of it as a deduction and part as a tax credit on your T1 return.
EI works differently for the self-employed. You are generally not required to pay EI premiums, and you do not get regular EI benefits, though you can opt in to the special benefits program for maternity, parental, sickness and caregiving. Controlling shareholders of their own corporation are usually exempt from EI as well, which is one input into how you pay yourself as an incorporated owner.
What changed from 2025 to 2026
- CPP maximum pensionable earnings rose $3,300, from $71,300 to $74,600.
- The CPP2 ceiling rose $3,800, from $81,200 to $85,000, widening the CPP2 band to $10,400.
- EI maximum insurable earnings rose $3,200, from $65,700 to $68,900.
- The EI employee rate fell from 1.64% to 1.63%, and the Quebec rate fell from 1.31% to 1.30%.
- Neither CPP rate changed. Base CPP stayed at 5.95% and CPP2 stayed at 4%.
One thing that did not change: the CPP basic exemption has been $3,500 since 1996. It is not indexed, so it quietly shrinks in real terms every year.
Get your 2026 payroll deductions right the first time
We provide payroll services in Whitby, Oshawa and across Durham Region, including Ajax, Pickering, Clarington, Bowmanville and Uxbridge. Remittances, year-end T4s, and the annual ceiling changes built into your schedule so the CRA never sends you a discrepancy notice about it.
Two groups feel these numbers hardest. If you run a crew, the increase multiplies: a construction or contracting business with four people at the ceiling pays $24,875 in employer CPP and EI in 2026, up $1,120.72 from last year for the same payroll. If you are self-employed and covering both halves yourself, you are looking at $9,292.90 in CPP, with no employer half to share it and no EI unless you opt in.
If you want the 2026 numbers applied to your own payroll, book a free 30 minute consultation and we will walk through it with you.
This article is for general information only and does not replace professional advice. The figures here were confirmed against the Canada Revenue Agency as of 1 August 2026 and can change. Always confirm with a qualified CPA before making payroll decisions.
