New ceiling takes into account growth in average weekly wages
The Canada Revenue Agency (CRA) has announced that the maximum pensionable earnings under the Canada Pension Plan (CPP) for 2017 will be $55,300, up from $54,900 in 2016.
The new ceiling was calculated using a CPP-legislated formula that takes into account the growth in average weekly wages and salaries in Canada.
Contributors who earn more than $55,300 in 2017 are not required or permitted to make additional contributions to the CPP.
The basic exemption amount for 2017 remains at $3,500, said the CRA.
The employee and employer contribution rates for 2017 will remain unchanged at 4.95 per cent. The self-employed contribution rate will remain unchanged at 9.9 per cent.
The maximum employer and employee contribution to the CPP for 2017 will be $2,564.10 each. The maximum self-employed contribution will be $5,128.20. The maximums in 2016 were $2,544.30 and $5,088.60, respectively, said the CRA.
Every employed Canadian over the age of 18 contributes to the CPP (QPP for those employed in Quebec). The CPP provides retirement, disability and survivor benefits and pensions to contributors and their families.
