How do I calculate a payroll remittance for one pay period?
For a 2026 pay period, the remittance is the employee's CPP (5.95% of pay above the per period exemption), EI (1.63%) and income tax, plus the employer's matching CPP and 1.4 times the EI. A $2,500 biweekly Ontario pay works out to $753.32: $281.48 of CPP, $97.80 of EI and $374.04 of tax.
What goes into one pay period's remittance?
Five amounts, added up for every employee paid on that pay date. Three come off the employee's cheque, and two are your client's own cost. The T4001 tells employers to remit the deductions "along with your share of CPP contributions and EI premiums" canada.ca.
| Line | Who pays | 2026 rate | 2026 annual cap |
|---|---|---|---|
| CPP | Employee | 5.95% of pay above $3,500 / pay periods | $4,230.45 |
| CPP | Employer | Equal to the employee's CPP | $4,230.45 |
| CPP2 | Employee and employer, each | 4% of pay between $74,600 and $85,000 | $416 each |
| EI | Employee | 1.63% of insurable earnings | $1,123.07 |
| EI | Employer | 1.4 times the employee's EI | $1,572.30 |
| Income tax | Employee | PDOC, the T4032 tables or the T4127 formulas | None |
The CPP rate and maximums are the CRA's 2026 figures, and the employer pays the same amount as the employee canada.ca. CPP2 is matched the same way
canada.ca. For EI, the CRA's rate table sets 2026 insurable earnings at $68,900 and says the employer's premium is 1.4 times the employee's
canada.ca. Full detail on the caps sits on CPP max 2026 and EI max 2026.
So the shortcut: remittance = 2 × employee CPP (and CPP2) + 2.4 × employee EI + income tax withheld. That holds unless your client has a reduced EI rate, covered below.
A $2,500 biweekly pay in Ontario remits $753.32
The employee works in Ontario, is paid $2,500 every two weeks (26 pays), filed the basic TD1 and TD1ON (claim code 1), has no pension plan, union dues or other deductions, and is well under every 2026 maximum. The pay is dated in March 2026.
CPP. The biweekly basic exemption is $134.61 canada.ca. $2,500 − $134.61 = $2,365.39, × 5.95% = $140.74. Your client matches it: $140.74. An employee who is at least 65 and under 70 and already gets a CPP retirement pension can stop this deduction with Form CPT30.
EI. $2,500 × 1.63% = $40.75. Employer share: $40.75 × 1.4 = $57.05.
Federal tax. The T4127 Option 1 formula annualizes the pay. The 1% first additional CPP is a deduction: $140.74 × 1/5.95 = $23.65 a pay, so annual taxable income is 26 × ($2,500 − $23.65) = $64,385. That sits in the 20.5% bracket: 20.5% × $64,385 − $3,804 = $9,394.93. Credits at 14%: basic personal amount $16,452 gives $2,303.28; base CPP and EI give 14% × (26 × $140.74 × 4.95/5.95 + 26 × $40.75) = $574.52; the $1,501 Canada employment amount gives $210.14. Annual federal tax: $6,306.98, or $242.58 a pay canada.ca.
Ontario tax. 9.15% × $64,385 − $2,210 = $3,681.23. Credits at 5.05%: $655.94 for the $12,989 basic amount and $207.24 for CPP and EI, leaving $2,818.04. That's under the $5,818 surtax threshold and too high for the Ontario tax reduction. The Ontario Health Premium at $64,385 is $600 and goes into the tax withheld. Annual Ontario tax: $3,418.04, or $131.46 a pay canada.ca. Income tax for the pay: ($6,306.98 + $3,418.04) / 26 = $374.04. (Lines are shown to the cent; the formula carries full precision.)
| Line | Employee | Employer | Remitted |
|---|---|---|---|
| CPP | $140.74 | $140.74 | $281.48 |
| EI | $40.75 | $57.05 | $97.80 |
| Income tax | $374.04 | $0 | $374.04 |
| Total | $555.53 | $197.79 | $753.32 |
Net pay is $2,500 − $555.53 = $1,944.47, and your client owes the CRA $753.32 for this employee on this pay. Add every other employee's lines from the same pay date. A regular remitter pays March's total by April 15 canada.ca; other remitter types are on payroll remittance due dates.
Why the remittance shrinks late in the year
Once an employee hits a maximum, both the deduction and the employer match stop, so a higher earner's remittance drops in steps. Take $4,000 biweekly ($104,000 a year) in 2026, income tax left out:
| Pay | Employee CPP | Employee CPP2 | Employee EI | Employer EI | CPP, CPP2 and EI remitted |
|---|---|---|---|---|---|
| 17 | $229.99 | $0 | $65.20 | $91.28 | $616.46 |
| 18 | $229.99 | $0 | $14.67 | $20.54 | $495.19 |
| 19 | $90.63 | $56.00 | $0 | $0 | $293.26 |
| 20 and 21 | $0 | $160.00 | $0 | $0 | $320.00 each |
| 22 | $0 | $40.00 | $0 | $0 | $80.00 |
| 23 to 26 | $0 | $0 | $0 | $0 | $0 |
EI tops out first: 17 pays of $65.20 is $1,108.40, so pay 18 takes the last $14.67 of the $1,123.07 cap, and the employer's last $20.54 brings it to exactly $1,572.30. Base CPP reaches $4,230.45 in pay 19. CPP2 starts in that same pay, but only on the $1,400 of year to date pay above $74,600, which is why it's $56 and not $160. The T4127 says CPP2 only begins once the employee's YMPE is reached canada.ca.
The income tax line doesn't stop. If your client's AMWA is near a threshold, these drops matter for the accelerated remitter threshold two years out.
Where should the income tax figure come from?
Three CRA tools, one method underneath. The T4127 says Option 1 is also what PDOC uses for its tax calculations, and that its formulas are generally more precise than PDOC canada.ca. The T4032 tables are built on Option 1 too, but they work in income ranges, so a table amount won't always match the formula to the cent.
Use the current edition. The July 2026 T4127 (123rd edition) changed British Columbia, Newfoundland and Labrador and Prince Edward Island from the first July payroll and left Ontario and the other provinces alone canada.ca. PDOC was updated for July 2026 as well
canada.ca.
Quebec is different. For an employee whose province of employment is Quebec, you deduct federal tax, EI at the Quebec rate (1.30% for 2026), QPIP and QPP, and Quebec income tax goes to Revenu Québec on the RL-1, not the T4 canada.ca. PDOC doesn't calculate Quebec tax, QPP or QPIP; the CRA points to Revenu Québec's WebRAS for those
canada.ca.
What throws a remittance off?
The pay date, not the work period, picks the month. The T4001 says due dates "are always based on when an employee is paid," so a period ending January 31 and paid February 6 belongs to the February remittance canada.ca.
A reduced EI rate. An employer with a qualifying short term disability plan registered in the Premium Reduction Program pays less than 1.4 times, but only for the employees the plan covers canada.ca. See EI premium reduction.
Taxable benefits. Add them to pay before you calculate. EI applies to cash benefits, not most non cash ones, and when a non cash benefit is the only pay in a period you don't deduct CPP on it canada.ca. More on taxable benefits.
Bonuses and vacation payouts. Tax on these uses the bonus method, not the regular annualized pay canada.ca. Vacation pay walks through one.
Treating the money as the business's. The T4001 says to hold deductions in trust for the Receiver General, separate from operating funds canada.ca. Late payment brings penalties, and unpaid amounts can land on the directors.
Sources
Do I pay the employer share in the same remittance?
Yes. The employer's CPP and EI go in the same payment as the employee deductions, one total for the remitting period canada.ca. On paper, that total goes on the PD7A voucher.
Does the employer share stop when the employee hits the maximum?
The employee had another job earlier this year. Do I start the CPP maximum from zero?
Yes. Each employer deducts CPP on its own payroll without regard to earnings with another employer, applies the full maximum even if the employee works for it less than 12 months, and gets no refund of its own share canada.ca. The employee gets any overpayment back on the T1; see CPP overpayment refund.
Can I use the T4032 tables instead of PDOC?
Yes, if the employee fits the tables. Expect small differences from PDOC or the formulas, because the tables use income ranges while Option 1 uses the exact pay canada.ca.
General information for the tax year shown, not advice for a specific client. Confirm the facts before you file or remit.