Canadian payroll deductions calculator

Every payroll deduction has a second half you never see

Your payslip shows income tax, CPP and EI coming out of your pay. It does not show that your employer paid CPP again, and EI at 1.4 times what you paid, on the same earnings.

On $85,000 in Ontario, side by side:

Income tax — $15,011 from you, nothing from the employer. Withholding only; the employer remits it but does not fund it.

CPP — $4,646.45 from you, $4,646.45 from the employer. Matched exactly, dollar for dollar, CPP2 included.

EI — $1,123.07 from you, $1,572.30 from the employer. The 1.4 multiplier is in the legislation, not a rounding: employment insurance is drawn by workers and funded mainly by those who hire them.

So the employer puts $6,219 on top of your $85,000. You cost $91,219 — 7.3% more than your salary — before a desk, a laptop or a benefits plan.

And that surcharge shrinks as the salary grows

CPP and EI both stop at a ceiling, so the employer's share stops with them. As a percentage of pay it falls away sharply:

$45,000 — the employer adds $3,496, or 7.8%.

$85,000 — $6,219, or 7.3%.

$200,000 — $6,219, or 3.1% — the same dollars as at $85,000, because both ceilings were passed long before.

That is worth knowing on both sides of a hiring conversation. Two junior hires at $45,000 cost their employer $774 more in payroll contributions than one senior hire at $200,000, on a smaller wage bill. It is a real cost difference that never appears in a salary band.

The week your take-home goes up

Because the ceilings are annual and the deductions are per pay period, contributions simply stop part-way through the year for anyone paid above the maximums — and net pay jumps for the rest of it, with no raise and no explanation on the payslip.

CPP stops once you have contributed $4,230.45 on earnings up to $74,600. EI stops at $1,123.07 on insurable earnings up to $68,900. CPP2 then runs on the slice between $74,600 and $85,000 and stops too.

Which pay period that falls in is worked out below, for every pay frequency — it is the single most common "is my payroll broken?" question, and the answer is almost always no. The paycheque calculator does the same for any salary you like.

How often you are paid changes nothing — except the date your pay goes up

The annual total is identical whichever way your employer slices it. On $85,000 in Ontario you pay $20,781 and keep $64,219, weekly or monthly, to the cent. What differs is the size of the pieces:

Weekly — $1,634.62 gross, $1,234.99 net, 52 times a year.

Every two weeks — $3,269.23 gross, $2,469.97 net, 26 times a year.

Twice a month — $3,541.67 gross, $2,675.80 net, 24 times a year.

Monthly — $7,083.33 gross, $5,351.61 net, 12 times a year.

But there is a second difference that no payroll calculator mentions, and it is the reason this question is worth asking. CPP and EI have annual ceilings and per-period deductions. Once you have paid the year's maximum they stop, and your net pay rises for every remaining cheque — no raise, no notice, nothing on the payslip to explain it.

On this salary the ceilings are reached, and when depends entirely on how you are paid: weekly at cheque 46 of 52, around November; every two weeks at cheque 23 of 26, around November; twice a month at cheque 22 of 24, around December; monthly at cheque 11 of 12, around December. Same salary, same province, same total contributions — a different month.

And the jump itself is not small. Paid weekly, the cheques after the ceiling are $1,337.94 rather than $1,234.99; paid monthly, $5,797.73 rather than $5,351.61. Budget on the early-year figure and the last months arrive better than expected; budget on the late-year figure and January is a shock.

The same $85,000 salary, every two weeks, in all 13

Payroll deductions are not one national number. Income tax has a federal half that is the same everywhere and a provincial half that is not, so the same gross salary lands differently depending on which province your employer runs payroll in. CPP and EI are national — except in Quebec, which runs its own pension plan and its own parental insurance and so deducts a different set of things entirely.

Most take-home first, on $85,000 paid every two weeks:

1. Nunavut — $2,521.87 a cheque, $65,569 a year.

2. British Columbia — $2,476.66 a cheque, $64,393 a year.

3. Northwest Territories — $2,475.36 a cheque, $64,359 a year.

4. Ontario — $2,469.97 a cheque, $64,219 a year ← this page.

5. Yukon — $2,466.03 a cheque, $64,117 a year.

6. Alberta — $2,454.74 a cheque, $63,823 a year.

7. Saskatchewan — $2,385.68 a cheque, $62,028 a year.

8. Manitoba — $2,355.12 a cheque, $61,233 a year.

9. New Brunswick — $2,353.06 a cheque, $61,180 a year.

10. Newfoundland and Labrador — $2,337.18 a cheque, $60,767 a year.

11. Quebec — $2,319.73 a cheque, $60,313 a year.

12. Prince Edward Island — $2,313.23 a cheque, $60,144 a year.

13. Nova Scotia — $2,278.64 a cheque, $59,245 a year.

$243.24 a cheque separates Nunavut from Nova Scotia — $6,324 a year on identical gross pay. Ontario sits 4th.

Two things that gap is not. It is not a cost-of-living adjustment: a territory near the top of this list is an expensive place to buy anything. And it is not the whole picture of what a province takes, because sales tax, property tax and land transfer tax all sit outside payroll and move in their own directions — Alberta's absence of a provincial sales tax does not show up on a payslip at all.

Why your payslip and this page can disagree, and it is usually one form

Everything here assumes the ordinary case: one job, the basic personal amount claimed once, no extra credits and no extra tax requested. Your employer does not assume that. Your employer uses whatever is on your TD1, the Personal Tax Credits Return, and outside Quebec there are two of them — a federal TD1 and a provincial one, Ontario's being the TD1ON.

The form decides how much of your pay is treated as untaxed before withholding starts. Get it wrong and the annual figure above is still right — you will settle up in April either way — but the monthly one is not, and the gap can run for a year.

Three things about it that catch people. First: if you never hand one in, the employer is not permitted to guess in your favour. The CRA's instruction is that your deductions will include the basic personal amount only, estimated from your income, with no other credit applied. Second: a change in your situation obliges a new form within 7 days — not at year end, not when you remember. Third: you only file a fresh one when your credit amounts actually change, so a TD1 signed on your first day can quietly govern your withholding for years.

And the one that produces most of the "my tax is wrong" messages: the personal amount is claimed once, not once per job. Two employers each applying the full basic personal amount means the same allowance is deducted twice, too little tax comes off all year, and the bill arrives with the return. The form has a box for exactly this case, and the back of it also carries a line for requesting additional tax to be deducted — the fix for anyone who would rather not be surprised in April.

None of which changes what you owe for the year, which on $85,000 in Ontario is $15,011 of income tax however it was withheld. It changes when you pay it, and who is holding it in the meantime.

Read off the CRA's guidance on getting the completed TD1 forms from the individual, on 2026-09-17.

Working the deduction out is the easy half. Knowing what day to send it is the other

Everything above is what comes off the employee. What an employer then has to do with it is governed by a completely separate rule, and it is the one that produces penalties: the CRA sets your remittance schedule from your average monthly withholding amount — the AMWA, meaning the average of everything you withheld and remitted per month over the two preceding calendar years. Not your revenue, not your headcount. What you withheld.

There are five schedules, and the distance between the ends of them is considerable:

Quarterly — new small employer — AMWA $0 to $999.99. Due April 15, July 15, October 15 and January 15. 4 payments a year.

Quarterly — small employer — AMWA $0 to $2,999.99. Due April 15, July 15, October 15 and January 15. 4 payments a year.

Regular — AMWA $0 to $24,999.99. Due the 15th day of the month after the month the employees were paid. 12 payments a year.

Accelerated — threshold 1 — AMWA $25,000 to $99,999.99. Due the 25th of the same month for the first half, and the 10th of the next month for the second. 24 payments a year.

Accelerated — threshold 2 — AMWA $100,000 or more. Due the 3rd working day after the 7th, the 14th, the 21st and the last day of each month. 48 payments a year.

The two quarterly schedules are not automatic: they need a clean compliance history as well as a small AMWA, so an employer who has been late gets the monthly schedule at the same size of payroll.

Which puts a number on something employers usually discover the hard way. In Ontario, one employee on $85,000 generates $2,249.96 of remittance a month — income tax withheld, the employee's CPP and EI, and the employer's share of both. So the schedules fall out as headcount:

Up to 11 employees on that salary and you are a regular remitter, sending one payment on the 15th of the following month. From 12 to 44 and you are on accelerated threshold 1 — two payments a month, on the 25th and the 10th. From 45 onwards you are on threshold 2: four payments a month, each due the third working day after the 7th, the 14th, the 21st and month end.

Nothing about the business has changed at that point except that it hired one more person. Going from twelve payments a year to forty-eight is the sort of thing that is much cheaper to see coming than to discover from a penalty notice, and the AMWA looks back two years, so the schedule you are on today was set by a payroll you ran a while ago.

Read off CRA — Remitting source deductions: how and when to remit (due dates), and remitter types by average monthly withholding amount on 2026-09-17. The headcount figures are this page's arithmetic on that salary in Ontario, not the CRA's — the thresholds are the CRA's and they are on the AMWA, not on employees.

What is deliberately not in the employer figure

Four provinces levy a payroll tax on employers over and above CPP and EI, each with its own name, its own rate and its own exemption threshold: Ontario's Employer Health Tax, British Columbia's employer health tax, Manitoba's Health and Post-Secondary Education Tax Levy, and Newfoundland and Labrador's Health and Post-Secondary Education Tax.

None is applied here, because each is set by its province rather than the CRA and none has been read for this page. For a small employer under the exemption threshold the figure above is the whole payroll cost; for a large one it is not, and the gap is a provincial matter.

Quebec adds employer contributions of its own, including the employer half of QPIP, administered by Revenu Québec. Also not included, for the same reason.

Where these figures come from

Read off the CRA's own documents, with the date each was read:

CRA — T4127 Payroll Deductions Formulas, 122nd edition (the bonus method, and the $5,000 note on annual taxable income) — read 2026-09-08. https://www.canada.ca/en/revenue-agency/services/forms-publications/payroll/t4127-payroll-deductions-formulas/t4127-jan/t4127-jan-payroll-deductions-formulas-computer-programs.html

CRA — T4127 Payroll Deductions Formulas, 123rd edition (the CPP base rate cut announced for 1 January 2027) — read 2026-09-08. https://www.canada.ca/en/revenue-agency/services/forms-publications/payroll/t4127-payroll-deductions-formulas/t4127-jul/t4127-jul-payroll-deductions-formulas.html

CRA — CPP contribution rates, maximums and exemptions (the self-employed rate and maximum) — read 2026-09-08. https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-deductions-contributions/canada-pension-plan-cpp/cpp-contribution-rates-maximums-exemptions.html

CRA — Second additional CPP contribution (CPP2) rates and maximums — read 2026-09-08. https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/calculating-deductions/making-deductions/second-additional-cpp-contribution-rates-maximums.html

CRA — EI premium rates and maximums, including the 1.4 employer multiplier — read 2026-09-08. https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-deductions-contributions/employment-insurance-ei/ei-premium-rates-maximums.html

CRA — The Canada Pension Plan enhancement: what it means for the self-employed (the credit and deduction split) — read 2026-09-08. https://www.canada.ca/en/revenue-agency/news/2023/05/the-canada-pension-plan-enhancement--businesses-individuals-and-self-employed-what-it-means-for-you.html

Service Canada — EI special benefits for self-employed people: premiums — read 2026-09-08. https://www.canada.ca/en/services/benefits/ei/ei-self-employed-workers/premiums.html

And what is not covered:

— Business expenses are not deducted. A self-employed figure here is tax on net income after expenses, so enter what is left once your costs are out — not what you invoiced.

— Employer payroll taxes beyond CPP and EI are not included. Ontario's Employer Health Tax, British Columbia's employer health tax, Manitoba's Health and Post-Secondary Education Tax and Newfoundland's payroll tax all fall on the employer above their own thresholds, and each is set by its province.

— Quebec's employer QPIP contribution and its other employer contributions are not included in the employer cost, because Revenu Québec publishes them separately and they have not been read here.

— The bonus figure is the withholding your employer takes, which is the CRA method. It is not necessarily your final tax on that bonus: that is settled on your return, where every credit you are entitled to applies.

— GST/HST on self-employment income is not modelled. Registration is required once revenue passes $30,000 in four consecutive quarters, and the tax is collected from clients rather than paid out of income.

Questions

How much does an employee actually cost an employer in Canada?

Salary plus 7.3% at $85,000 in Ontario — $91,219 in total. The employer matches CPP dollar for dollar and pays EI at 1.4 times the employee rate, which comes to $6,219 on top of the wage. Provincial employer payroll taxes are extra where they apply.

Does my employer pay the same EI as me?

No — more. The employer rate is 1.4 times yours, capped at $1,572.30 for 2026 ($1,253.98 in Quebec). CPP is the one that is matched exactly.

Why did my take-home pay go up mid-year without a raise?

Your CPP or EI contributions reached their annual ceilings. Both are capped for the year, so once you have paid the maximum, the deduction stops and the rest of your pay comes with income tax only. The paycheque calculator says which pay period that falls in.

What are the total payroll deductions on $85,000?

$20,781 from the employee — $15,011 income tax, $4,646.45 CPP and $1,123.07 EI — leaving $64,219. The employer separately pays $6,219.

Do employers pay income tax on wages?

No. Income tax is entirely the employee's; the employer withholds and remits it but does not fund any of it. What employers fund is CPP, EI, and in four provinces a payroll tax of the province's own.

What are the payroll deductions on a bi-weekly paycheque in Ontario?

On $85,000 a year paid every two weeks, $3,269.23 gross becomes $2,469.97 net: $577.35 of income tax and $221.90 of CPP and EI. Paid weekly the same salary is $1,234.99 a cheque; paid monthly, $5,351.61.

Does being paid weekly instead of monthly change my payroll deductions?

Not the annual total — that is $20,781 either way, to the cent. What it changes is when your net pay rises: CPP and EI stop once you hit their annual ceilings, which on $85,000 happens at cheque 46 of 52 if you are paid weekly and cheque 11 of 12 if you are paid monthly. Same money, different month.

Which province has the lowest payroll deductions in Canada?

Of the 13 jurisdictions, Nunavut leaves the most in hand on $85,000 — $2,521.87 every two weeks against $2,278.64 in Nova Scotia, a difference of $6,324 a year. The federal half of income tax is identical everywhere; the provincial half is not, and Quebec deducts a different set of contributions altogether.

How often does an employer have to remit payroll deductions to the CRA?

It depends on the average monthly withholding amount over the two preceding calendar years, not on headcount or revenue. Quarterly — small employer: AMWA up to $2,999.99, 4 payments a year; Regular: AMWA up to $24,999.99, 12 payments a year; Accelerated — threshold 1: AMWA up to $99,999.99, 24 payments a year; Accelerated — threshold 2: AMWA $100,000 or more, 48 payments a year. Read off the CRA on 2026-09-17.

How many employees before I have to remit payroll deductions twice a month?

In Ontario, one employee on $85,000 produces about $2,249.96 of remittance a month once the employer's CPP and EI are counted. That puts the accelerated threshold-1 boundary at roughly 12 employees on that salary, and threshold 2 — four payments a month — at about 45. The CRA's thresholds are on the dollar amount, so a payroll of fewer, better-paid people crosses them sooner.