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ARCHIVED - Payroll Deductions Tables - CPP, EI, and income tax deductions - In Canada beyond the limits of any province/territory or outside Canada

T4032-OC(E) Rev. 23

This guide uses plain language to explain the most common tax situations. If you need more help, contact 1-800-959-5525.

Table of contents

Section A

Section B

Section C

Section D

  • Tax Deductions Tables
    • Weekly (52 pay periods)
    • Biweekly (26 pay periods)
    • Semi-monthly (24 pay periods)
    • Monthly (12 pay periods)

What's new as of January 1, 2023

The major changes made to this guide since the last edition are outlined.

This guide reflects some income tax changes recently announced which, if enacted as proposed, would be effective January 1, 2023. At the time of publishing, some of these proposed changes were not law. We recommend that you use the new payroll deductions tables in this guide for withholding starting with the first payroll in January 2023.

On March 3, 2022, amendments were made to Subsection 100 (3), paragraph 60 (e.1) of the Income Tax Regulation, ensuring Canada Pension Plan (CPP) additional contributions are treated as a deduction at source. This is effective January 1, 2023. The amended tax treatment for CPP additional contributions is imbedded in the tax deduction tables. You are not required to take any additional steps to include this deduction.

The provincial and federal tables are designed to accurately calculate the deductions provided by the CPP additional contributions in most situations. However, for the following situations, use the Payroll Deductions Online Calculator (PDOC) for more accurate calculations:

  • If at any point during the year, the employee reaches the Year’s Maximum Pensionable Earnings (YMPE) of $66,600 or;
  • A payment of remuneration, if annualized by the number of pay periods in the cycle, is over the YMPE of $66,600

If the tables are used in these situations, it may result in over or under deduction of federal and provincial taxes during the year.

The federal income tax thresholds have been indexed for 2023.

The federal Canada Employment Amount (CEA) has been indexed to $1,368 for 2023.

Upcoming changes as of January 1, 2024

As per Canada Pension Plan Regulations Subsection 5.1 (1), for the year 2024 and each subsequent year, pensionable earnings up to the second earnings ceiling will be subject to the second additional contributions rate.

Use PDOC for more accurate calculations in the following situations for 2024 and onwards:

  • If at any point during the year, the employee reaches the YMPE or;
  • A payment of remuneration, if annualized by the number of pay periods in the cycle, is over the YMPE

If the tables are used in these situations, it may result in over or under deduction of federal and provincial taxes during the year.

Payroll Deductions Tables

You can download Guides T4008, Payroll Deductions Supplementary Tables, and T4032, Payroll Deductions Tables, from our webpage at canada.ca/payroll. You can also choose to print only the pages or information that you need.

Payroll Deductions Online Calculator

For your 2023 payroll deductions, we strongly recommend using our PDOC. The online calculator makes it faster and easier to calculate payroll deductions. The calculator also uses exact salary figures and provides more accurate calculations. PDOC is available at canada.ca/pdoc.

PDOC calculates payroll deductions for the most common pay periods, as well as the applicable province (except Quebec) or territory.

PDOC users are now able to input the number of pensionable months for the Canada Pension Plan contribution calculation for the 2023 taxation year. For more information and examples regarding pensionable months, refer to T4001 Employers’ Guide – Payroll Deductions and Remittances.

Let us notify you

We provide a digital service that can notify you immediately, free of charge, of any changes for payroll deductions.

To subscribe, visit our webpage at canada.ca/cra-email-lists and enter your business's email address for each mailing list that you want to join.

Special Notice

Payroll Deductions Tables (T4032)

The Canada Revenue Agency is no longer publishing the paper and CD versions of the Guide T4032, Payroll Deductions Tables. The digital versions of the guide continue to be available on our website at canada.ca/payroll.

Who should use this guide?

This guide is intended for the employer and the payer. It contains tables for federal and provincial tax deductions, CPP contributions and EI premiums. It will help you determine the payroll deductions for your employees or pensioners.

The provincial and federal tables are designed to accurately calculate the deductions provided by the CPP additional contributions in most situations. However, for the following situations, we recommend using the PDOC for more accurate calculations:

  • If at any point during the year, the employee reaches the YMPE of $66,600 or;
  • A payment of remuneration, if annualized by the number of pay periods in the cycle, is over the YMPE of $66,600

If the tables are used in these situations, it may result in over or under deduction of federal and provincial taxes during the year.

For more information on deducting, remitting, and reporting payroll deductions, see the following employers' guides:

  • T4001, Employers' Guide – Payroll Deductions and Remittances
  • T4130, Employers' Guide – Taxable Benefits and Allowances
  • RC4110, Employee or Self-employed?
  • RC4120, Employers' Guide – Filing the T4 Slip and Summary
  • RC4157, Deducting Income Tax on Pension and Other Income, and Filing the T4A Slip and Summary

These guides are available on our website at canada.ca/taxes.


Note


Refer to the 2022 edition of Payroll Deductions Tables to resolve any pensionable and insurable earnings review (PIER) deficiencies that we identify in processing your 2022 T4 return.

What if your pay period is not in this guide?

This guide contains the most common pay periods: weekly, biweekly (every two weeks), semi-monthly, and monthly. If you have unusual pay periods, such as daily (240 working days), or 10, 13, or 22 pay periods a year, see the Guide T4008, Payroll Deductions Supplementary Tables, or the Payroll Deductions Online Calculator (PDOC) to determine tax deductions.

Which provincial or territorial tax table should you use?

Before you decide which tax table to use, you have to determine your employee's province or territory of employment. This depends on whether or not you require the employee to report for work at your place of business.

If the employee reports for work at your place of business, the province or territory of employment is considered to be the province or territory where your business is located. To withhold payroll deductions, use the tax table for that province or territory of employment.

If you do not require the employee to report for work at your place of business, the province or territory of employment is the province or territory in which your business is located and from which you pay your employee's salary.

For more information and examples, see Chapter 1, "General Information" in Guide T4001 Employers' Guide – Payroll Deductions and Remittances.

Federal tax for 2023

Indexing for 2023

For 2023, the federal income thresholds, the personal amounts, and the Canada employment amount have been changed based on changes in the consumer price index.

The federal indexing factor for January 1, 2023 is 6.3%. The tax credits corresponding to the claim codes in the tables have been indexed accordingly. Employees will automatically receive the indexing increase, whether or not they file Form TD1, 2023 Personal Tax Credits Return.

Tax rates and income thresholds

For 2023, the federal tax rates and income thresholds are:

Chart 1 – 2023 federal tax rates and income thresholds
Annual taxable income ($) from Annual taxable income ($) to Federal tax rate, R Constant ($), K
0.00 53,359.00 0.1500 0
53,359.01 106,717.00 0.2050 2,935
106,717.01 165,430.00 0.2600 8,804
165,430.01 235,675.00 0.2900 13,767
235,675.01 and over 0.3300 23,194

Additional federal tax for income earned outside Canada

The additional federal tax applies to deemed residents of Canada such as members of the Canadian Armed Forces who reside outside of Canada, Canadian residents with income from a permanent establishment in a foreign country, and non-residents who have employment income taxable in Canada.

The rate for the additional federal tax for income which is considered to have been earned in Canada but which is not earned in a province or territory is 48% for 2023.

Canada Employment Amount

The non-refundable tax credit for CEA is built into the federal payroll deductions tables. The federal CEA is the lesser of:

  • $1,368 and
  • the individual’s employment income for the year

The maximum annual non-refundable tax credit is $205.20.

Pension income is not eligible for this credit. If you are paying pension income, use the PDOC to calculate the tax deduction.

Basic personal amounts

The federal personal amounts for 2023 are:

Basic personal amounts
Maximum basic personal amount ($) Minimum basic personal amount ($)
15,000 13,521

For more detailed information on the personal amounts, go to Form TD1.

Canada Pension Plan (CPP) and Employment Insurance (EI)

CPP contributions for 2023

CPP contributions
CPP Year’s Maximum Pensionable Earnings (YMPE) Basic Exemption Year’s Maximum Contributory Earnings (YMCE) Employee and Employer Contribution Rate Maximum Employee and Employer Contribution
CPP base contribution 66,600.00 3,500.00 63,100.00 0.0495 3,123.45
CPP additional contribution 66,600.00 3,500.00 63,100.00 0.0100 631.00
CPP contribution* 66,600.00 3,500.00 63,100.00 0.0595 3,754.45

*CPP base and additional contributions are already included in the CPP contributions.

You stop deducting CPP when the employee reaches their maximum annual contribution for the year. For more information, see Chapter 2, “Canada Pension Plan contributions” in Guide T4001, Employer’s Guide – Payroll Deductions and Remittances.


Note


As an employer, you must remit the employer’s and employee’s share of the CPP contributions.

EI premiums for 2023

EI premiums for 2023
EI Maximum Annual Insurable Earnings Employee Contribution Rate Employer Contribution Rate Maximum Annual Employee Premium Maximum Annual Employer Premium
Canada except QC 61,500.00 0.0163 0.02282 1,002.45 1,403.43

You stop deducting EI when the employee reaches their maximum annual premium. For more information, see Chapter 3, “Employment Insurance premiums” in Guide T4001, Employer’s Guide – Payroll Deductions and Remittances.


Note


As an employer, you must remit the employer’s and employee’s share of EI premiums.

Personal tax credits returns (TD1 forms)

You may have to ask your employees or your pensioners to complete a federal personal tax credits return using a federal Form TD1.

For more information, see Chapter 5, "Deducting income tax" in Guide T4001, Employers' Guide – Payroll Deductions and Remittances.

Claim codes

The total personal amount an employee claims on a TD1 form will determine which claim code you use. See Chart 2.

Explanation of claim codes

Claim code 0

This code represents no claim amount.

Claim codes 1 to 10

The claim code amounts do not appear on the federal TD1 form.

You match the "Total claim amount" reported on your employee's or pensioner's TD1 forms with the appropriate claim codes. Then, you look up the tax for the employee's pay under the claim code in the federal tax tables for the pay period.

Indexing of federal claim codes amounts

The credits that apply to each claim code have been automatically increased in the tax tables by the indexing factor for the current year. If your employee did not complete the federal TD1 forms for 2023, you continue to deduct income tax using the same claim code that you used last year.

Chart 2 – 2023 Federal claim codes

Form TD1X, Statement of Commission Income and Expenses for Payroll Tax Deductions

If your employees want you to adjust their tax deductions to allow for commission expenses, they have to complete Form TD1X, Statement of Commission Income and Expenses for Payroll Tax Deductions.

You deduct tax from your employees' commission pay using the "Total claim amount" on their TD1 forms, in the following situations:

  • if your employees do not complete a Form TD1X or
  • if they tell you in writing that they want to cancel a previously completed Form TD1X

How to use the tables in this guide

Use the tables in this guide to determine the CPP contributions, EI premiums, federal tax, and provincial tax that you will deduct from your employees' remuneration.

CPP tables (Section B)

The annual basic exemption is built into the CPP tables.

  • Find the pages in Section B that correspond to your pay period
  • To find the range that includes your employee's gross pay (this includes any taxable benefits), look down the "Pay" column
  • In the column next to the "Pay" column, you will find the CPP contribution that you should withhold from your employee's pay

EI table (Section C)

  • Find the page in Section C that corresponds to the "Insurable earnings" of your employee
  • To find the range that includes your employee's insurable earnings, look down the "Insurable earnings" column. When you use the table in this guide to determine the EI premiums, look up the insurable earnings for the period not the gross remuneration
  • In the column next to the "Insurable earnings" column, you will find the EI premium that you should withhold from your employee's pay

Federal tax deductions tables (Section D)

Even if the period of employment for which you pay a salary is less than a full pay period, you must continue to use the tax deductions table that corresponds to your regular pay period.

  • Find the pages in Section D that correspond to your pay period
  • To find the range that corresponds to your employee's taxable income (this includes any taxable benefits), look down the "Pay" column
  • In the row under the applicable claim code, you will find the amount of federal tax that you should withhold from your employee's pay (for more information, see the section called "Claim codes" and Chart 2)

Additional information about payroll deductions

Deducting tax from income not subject to CPP contributions or EI premiums

We have built the tax credits for CPP contributions and EI premiums into the federal and provincial tax deductions tables in this guide. However, certain types of income, such as pension income, are not subject to CPP contributions and EI premiums. As a result, you will have to adjust the amount of federal and provincial income tax you are deducting.

To determine the amount of tax to deduct from income not subject to CPP contributions or EI premiums, use the Payroll Deductions Online Calculator, available at canada.ca/pdoc. On the "Salary calculation" and/or on the "Commission calculation" screen, go to Step 3 and select the "CPP exempt" and/or "EI exempt" option before clicking on the "Calculate" button.

Step-by-step calculation of tax deductions

You can use the following step-by-step calculations to calculate the tax deductions for your employee or pensioner.

The example shows you how to determine the amount of tax to deduct from all income.

However, if you design your own payroll program or spreadsheets to calculate tax deductions, do not use either of these calculations. Instead, see Guide T4127, Payroll Deductions Formulas.


Example
Tax to deduct for all income


This example applies to a person who earns $1,200 weekly outside of Canada and contributes $80 to a registered retirement savings plan (RRSP). This person claims the basic personal amount. The CPP contributions and the EI premiums are:

CPP contributions = 0.0595 × ($1,200 – ($3,500/52)) = $67.40

EI premiums = 0.0163 × $1,200 = $19.56

Calculate annual taxable income
Description Sub-amounts Amounts
(1) Gross remuneration for the pay period (weekly) $1,200.00
(2) Minus
  • CPP additional contribution ($67.40 × (0.0100/0.0595))
 11.33
  • the RRSP contributions*
 80.00
− $(91.33)
* This amount has to be deducted at source.
(3) Net remuneration for the pay period (line 1 minus line 2) $1,108.67
(4) Net annual income ($1,108.67 × 52 weeks) $57,650.84
(5) Minus the annual deduction for living in a prescribed zone, reported on the Form TD1 − (0.00)
(6) Annual taxable income (line 4 minus line 5) $57,650.84
Calculate federal tax
Description Sub-amounts Amounts
(7) Multiply the amount at line 6 by the federal tax rate (R) based on Chart 1 $57,650.84
× 0.205
$11,818.42
(8) Minus the federal constant (K) based on the annual taxable income on line 6 (see Chart 1) − (2,935.00)
(9) Federal tax (line 7 minus line 8) $8,883.42
(10) Minus the federal tax credits:
  • the total of personal tax credit amounts reported on the Form TD1
 $15,000.00
  • the CPP base contributions for the pay period multiplied by the number of pay periods in the year (annual maximum $3,123.45)*
    ($67.40 × (0.0495/0.0595) × 52)
 2,915.76
  • the EI premiums for the pay period multiplied by the number of pay periods in the year (annual maximum $1,002.45)*
 1,002.45
  • the Canada employment amount (annual maximum $1,368.00)
 1,368.00
Total $20,286.21
*Note
When the maximum CPP contributions or EI premiums for the year is reached, use the maximum amount for later calculations
(11) Multiply the total on line 10 by the lowest federal tax rate for the year × 0.15
(12) Total federal tax credits − (3,042.93)
(13) Basic federal tax (line 9 minus line 12) $5,840.49
(14) Additional federal tax for income earned outside Canada 48% of the amount on line 13 2,803.44
(15) Total federal tax payable for the year (line 13 plus line 14). 8,643.92
Calculate total tax and the tax deduction for the pay period
Description Sub-amounts Amounts
(16) Tax deduction for the pay period:
Divide the amount on line 15 by the number of pay periods in the year (52).		 $166.23


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Date modified:
2022-12-23