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2009 CPP & EI

ImageUpdated with 2009 rates! This applies to you if you have a regular job with a salary over about $40,000 per year. We all have to pay CPP and EI, these are deducted at source by your payroll. Both CPP and EI have a maximum annual amount, and that payroll does not spread out the amount throughout the year. The net effect is your take home pay is less at the start of the year, until you reach your maximums.

In 2009, CPP employee contribution rate remains unchanged at 4.95%, and the maximum annual pensionable earnings has gone up from $44,900 to $46,300. If you work it out, with the basic exemption, you have to pay $2,118 CPP in 2009. That is an increase of $69.30 or 3% from last year.

For EI, the maximum annual insurable earnings has gone up from $41,100 to $42,300 and the EI rate remains unchanged at 1.73% for 2009. If you calculate that, you will need to pay a maximum of $732 for EI in 2009. That is an increase of $20.76 or 3% from last year (see a pattern there?).

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In the above table, you can see that for an income of $50,000 annually, you have reached your maximum at 10.3 months. It was 9.9 months in 2008, so things are getting worse. For some of November and December you get an extra $278 in your pay - just in time for holiday spending or topping up your RRSP.

The more you earn, the sooner you reach your maximum CPP + EI. At a salary of $100,000 you get an extra $557 per month from June through to December. Even more to put into your RRSP...

An excel file of the calculations is found here

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For 2009 CPP info, check here, for 2009 EI info check here

Pat

 
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