T4032-OC(E) Rev. 15

This publication uses plain language to explain the most common tax situations. If you need more help, contact your tax services office.

What's new as of January 1, 2015

Payroll Deductions Tables

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

Publication T4032, Payroll Deductions Tables, is also available on CD for use on any computer with or without Internet access. You can order a copy at www.cra.gc.ca/orderforms or by calling 1-800-959-5525.

Paper copies remain available for employers who do not use a computer. To get a copy, call us at 1-800-959-5525.

Payroll Deductions Online Calculator

For your 2015 payroll deductions, you can use our Payroll Deductions Online Calculator (PDOC). The online calculator makes it easier to calculate payroll deductions. PDOC is available at www.cra.gc.ca/pdoc.

PDOC calculates your payroll deductions. It calculates deductions for any pay period, province (except Quebec) and territory. The calculation is based on exact salary figures.

Let us notify you

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

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

Who should use this publication?

This publication 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.
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 www.cra.gc.ca. You can also get the guides by completing the order form available on our Web site or by calling 1-800-959-5525.

What if your pay period is not in this publication?

This publication 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 Publication 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 or 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 2015

Indexing for 2015

Tax rates and income thresholds

For 2015, the tax rates and income thresholds are as follows:

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 2015.

Canada employment credit

Personal amounts

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

CPP contributions for 2015

You stop deducting CPP when the employee reaches the maximum contribution for the year.

For more information, see Chapter 2, "Canada Pension Plan contributions," in Guide T4001, Employer's Guide – Payroll Deductions and Remittances.

EI premiums for 2015

You stop deducting EI when the employee reaches the maximum annual premium.

For more information, see Chapter 3, "Employment Insurance premiums," in Guide T4001, Employer's Guide – Payroll Deductions and Remittances.

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 allowed.

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 2015, you continue to deduct income tax using the same claim code that you used last year.

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 publication

Use the tables in this publication 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 shaded 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 publication to determine the EI premiums, look up the insurable earnings for the period not the gross remuneration.
• In the shaded 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 publication. 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 www.cra.gc.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 any employee or pensioner who earns more than the maximum amounts included in the tax deductions tables.

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 Publication T4127, Payroll Deductions Formulas for Computer Programs.

Your opinion counts!

If you have any comments or suggestions that would help us improve this publication, we would like to hear from you. Please send your comments to:

Taxpayer Services Directorate
Canada Revenue Agency
395 Terminal Avenue
Ottawa ON K1A 0L5