CRA announces maximum pensionable earnings for next yearBy The IJ Staff | November 02 2018 09:30AM
The Canada Revenue Agency has announced that the maximum pensionable earnings under the Canada Pension Plan (CPP) for 2019 will be $57,400. This is up from $55,900 in 2018.
Contributors who earn more than $57,400 in 2019 are not permitted to make additional contributions to the CPP. The basic exemption amount for 2019 remains $3,500.
The new ceiling was calculated according to a CPP legislated formula that takes into account the growth in average weekly wages and salaries in Canada.
Employee and employer contribution rates
Employee and employer contribution rates for 2019 will be 5.1%, an increase from 4.95% in 2018. The self-employed contribution rate will be 10.2%, up from 9.9% in 2018.
The maximum employer and employee contribution to the plan for 2019 will be $2,748.90 each and the maximum self-employed contribution will be $5,497.80. The maximums in 2018 were $2,593.80 and $5,187.60.
The CRA explains that the increase in contribution rate is due to the CPP enhancement which will be implemented on Jan.1, 2019.