CPP Max Contribution 2024: Rates, Limits & Exemptions

If you’ve ever looked at a pay stub and wondered why CPP deductions vary year to year—or why the numbers on your T4 don’t match your neighbour’s—you’re not alone. The Canada Pension Plan uses a precise formula tied to earnings limits set annually by the federal government. For 2024, the Year’s Maximum Pensionable Earnings sits at $68,500, a figure that directly determines how much you and your employer will contribute.

2024 YMPE: $68,500 · Basic Exemption: $3,500 · Self-Employed Max Contribution: $7,735.00 · Second Earnings Ceiling 2024: $73,200 · Max Monthly CPP at 65 in 2024: $1,364.60

What are CPP and EI maximums for 2024?

The Canada Pension Plan and Employment Insurance operate as separate payroll deductions, each with their own earnings ceilings and contribution formulas. The Canada Revenue Agency sets the Year’s Maximum Pensionable Earnings each November for the following calendar year. For 2024, the YMPE stands at $68,500—up from $66,600 in 2023 (Canada Revenue Agency).

CPP maximums

The CPP contribution formula applies the 5.95% rate to pensionable earnings between the $3,500 basic exemption and the YMPE. For an employee earning above $68,500, maximum CPP contribution in 2024 is $3,867.50. The employer matches this amount dollar for dollar. Self-employed individuals pay both the employee and employer portions, bringing their maximum to $7,735.00 (Canada Revenue Agency).

EI maximums

Employment Insurance uses a different ceiling called the Maximum Insurable Earnings. For 2024, the MIE is $63,200, set by the Canada Employment Insurance Commission (Government of Canada). The employee premium rate outside Quebec is 1.66% of insurable earnings, producing a maximum annual deduction of $1,049.12. Employers pay 1.4 times the employee rate—$2.32 per $100 of insurable earnings—capping at $1,468.77 per employee covered.

Key differences

The most significant structural difference is that EI has a single earnings ceiling while CPP introduced a second tier in 2024. Quebec residents benefit from a lower EI rate (1.32%) because the province administers its own parental insurance plan through QPIP, which reduced the federal EI employee rate from 1.66% to 1.32% for Quebec-based workers (Government of Canada). The maximum EI employee premium in Quebec for 2024 is $834.24.

How much is the max CPP contribution for 2024?

The answer depends on your employment status and whether your earnings cross both contribution thresholds. The Canada Revenue Agency publishes the official contribution tables annually, and the 2024 figures reflect both the base CPP rate and the newly introduced CPP2 second-tier rate.

Employee contributions

For employees paid by an employer, the CPP base contribution uses a 5.95% rate applied to earnings between $3,500 and $68,500. The calculation is ($68,500 − $3,500) × 5.95% = $3,867.50. A second, separate contribution applies to earnings between $68,500 and $73,200 using the CPP2 rate of 4%, adding up to $188 in additional CPP (Littler). Combined, an employee at or above the second ceiling pays $4,055.50 to CPP in 2024.

Employer contributions

Employers match employee CPP contributions dollar for dollar on the base rate, meaning $3,867.50 matched. The CPP2 match is also $188. Total employer CPP contribution in 2024 for a worker earning above $73,200 is $4,055.50. The Canada Employment Insurance Commission noted that the Premium Reduction Program saved employers approximately $1.29 billion in 2024 through discounted EI rates for businesses with eligible benefit plans (Government of Canada).

Self-employed total

Self-employed individuals pay both the employee and employer portions of CPP. The combined rate is 11.90% on earnings between $3,500 and $68,500, yielding a maximum of $7,735.00. On the CPP2 tier, self-employed individuals pay 8%, capping at $376.00 for 2024. Total maximum self-employed CPP contribution: $8,111.00 (Canada Revenue Agency). Note that sources vary slightly on the self-employed CPP2 figure; the $376 amount is based on third-party employer guides rather than direct CRA publication.

What salary will max out CPP?

The salary threshold depends on whether you’re counting just the base CPP or including the new CPP2 second tier. Understanding the two-threshold structure is essential for financial planning and payroll compliance.

Income threshold

For base CPP, any employment income at or above $68,500 in 2024 triggers the maximum employee contribution of $3,867.50 (Canada Revenue Agency). The $3,500 basic exemption means the actual contributory earnings base is $65,000 ($68,500 − $3,500). The math is straightforward: $65,000 × 5.95% = $3,867.50.

Calculation method

The formula applies only to earnings above $3,500. Someone earning $40,000 pays CPP on $36,500 at 5.95%, totaling $2,171.75. The CPP2 tier uses earnings between YMPE ($68,500) and YAMPE ($73,200)—a $4,700 range—at the 4% rate, adding $188 to the total contribution for workers above the second ceiling. The combined maximum employee CPP in 2024 is $4,055.50 (Littler).

2024 specifics

The introduction of YAMPE means workers no longer face a single earnings wall. Income between $68,500 and $73,200 triggers additional CPP2 contributions at 4%. Earnings above $73,200 attract no further CPP deductions—base or enhancement. This creates a two-stage ceiling rather than the single-cap structure that existed before 2024.

What this means: high earners above $73,200 in 2024 receive no additional CPP buildup on income beyond this ceiling, making RRSPs and other retirement vehicles critical for supplementing pension contributions.

Is there a cap on CPP contributions?

Yes. CPP has had contribution caps since its inception, but 2024 introduced a two-tier ceiling structure through the enhancement phase. The caps apply per employer, per year. If you change employers mid-year, each employer deducts based on your earnings with that employer—meaning you could theoretically contribute above the published maximum if you earned above $68,500 with multiple employers in the same year.

Contribution caps explained

The Year’s Maximum Pensionable Earnings ($68,500) sets the base CPP cap. Earnings above $68,500 but at or below $73,200 trigger the CPP2 additional contributions at 4%. Earnings above $73,200 attract zero additional CPP deductions in 2024 (Canada Revenue Agency). The basic exemption of $3,500 means CPP contributions never apply to the first $3,500 of annual earnings.

Exemptions and limits

The $3,500 basic exemption is a permanent feature of CPP, not subject to annual adjustment the way YMPE is. It applies equally to employees and self-employed. The exemption reduces effective contributory earnings to $65,000 at the maximum tier ($68,500 − $3,500). Employment Income above $73,200 produces no further CPP base or CPP2 contributions for 2024.

Enhancement changes

CPP enhancements began rolling out in 2019 and reached their final phase on January 1, 2024. The final phase introduced the Year’s Additional Maximum Pensionable Earnings as the upper boundary for CPP2 contributions (Littler). The enhancement is designed to replace approximately one-third of pre-retirement earnings at retirement—up from the previous 25% replacement rate. Workers earning at the maximum tier can expect higher CPP benefits at retirement, with the maximum monthly benefit at age 65 reaching $1,364.60 in 2024 (Canada Revenue Agency).

What is the maximum CPP contribution for 2026 vs 2025?

Both years show consistent upward movement in the official ceilings, driven by the indexing formula tied to average weekly earnings growth. The Canada Revenue Agency announces the following year’s figures in the fall, giving employers and payroll administrators time to update systems.

2024 vs 2025

The 2025 figures are already confirmed: YMPE rises from $68,500 to $71,300, a 4.1% increase. YAMPE climbs from $73,200 to $81,200—a 10.9% jump that reflects the expanding CPP2 scope. The CPP base rate stays at 5.95% for 2025 (Canada Revenue Agency). Maximum employee CPP in 2025 will be approximately $4,032 before CPP2, and the CPP2 maximum will rise above 2024’s $188 given the wider band between YMPE and YAMPE.

The pattern: the CPP2 window widened from $4,700 in 2024 to $9,900 in 2025, dramatically increasing the contribution burden on workers earning between these two thresholds.

2025 vs 2026

Official 2026 figures have not been published as of this writing. The indexing formula applies a percentage increase based on average weekly earnings data from Statistics Canada, typically producing increases in the 3–5% range for YMPE. The Canada Revenue Agency releases the official announcement each November for the following calendar year—expect the 2026 announcement in November 2025.

Trend overview

The five-year trajectory shows consistent annual growth in the contribution ceilings, driven by wage inflation. The introduction of YAMPE in 2024 created a second ceiling that will continue expanding as the CPP2 enhancement matures toward its 2025 target replacement rate of one-third of pre-retirement earnings. The implication for workers: those earning near the YMPE threshold will see their CPP deductions increase each year as the ceiling rises, even if their salary remains flat.

What this means: workers banking on stable payroll deductions will face rising CPP costs as the enhancement phase matures, making income above the YAMPE threshold increasingly attractive for those seeking maximum retirement benefits.

CPP and EI contribution specifications

Eight key figures govern CPP and EI payroll deductions for 2024, with rates and ceilings varying by employment type and province of employment.

The 2025 YMPE will be $71,300.00—up from $68,500 in 2024.

— Canada Revenue Agency, Official Government Announcement

In 2024, a second earnings ceiling was introduced, the Year’s Additional Maximum Pensionable Earnings (YAMPE).

— Canada Revenue Agency, CPP Contribution Tables

The rate is set at $1.66 per $100 of insurable earnings for employees and $2.32 for employers.

— Canada Employment Insurance Commission, Governing Body Announcement

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These 2024 CPP limits pave the way for enhancements, including the expanded 2025 CPP earnings ceilings detailed in 2025 CPP earnings ceilings that capture 14% more earnings.

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