CPP and EI Premiums to Kick in Again on January 1

On their January pay statements, most teachers will notice a reduction in their take-home pay as the premiums for the Canada Pension Plan (CPP) and Canada employment insurance (EI) resume for the new calendar year. Many teachers reach the maximum contribution limits in late spring or early summer if their annual earnings exceed the maximum contribution for CPP and EI and experience increases in their net pay until December. 

Under the CPP, teachers will contribute 5.95 per cent on pensionable earnings up to $74,600 in 2026. This is the first earnings ceiling. They will also contribute an additional four (4) per cent on earnings between the first ceiling and the second ceiling (CPP2), which is set at $85,000 for 2026.

The maximum pensionable earnings for both the base CPP and CPP2 are the amounts on which both the employee and employer are required to make CPP contributions in a given year. In 2026, employees will reach the maximum annual CPP deductions once total contributions reach $4,646.45. This amount consists of $4,230.45 for CPP and $416.00 for CPP2. 

For further clarification, for a teacher in 2026 earning above $85,000, their total maximum deduction will be $4,646.45 for CPP and CPP2 contributions. In 2025, the total maximum deduction was $4,430.10 for CPP and CPP2 contributions. This is an increase of $216.35 in 2026.

The maximum annual insurable earnings (MIE) for EI in 2026 is $68,900, an increase from the previous year. Teachers will contribute 1.63 per cent on insurable earnings to the maximum annual employee premium of $1,123.07. The MIE amount and contribution rate in 2025 was $65,700 and 1.64 per cent, respectively. The increase in the maximum deduction amount from 2025 to 2026 is $45.59.

WORTH SHARING
Teachers will notice Canada Pension Plan (CPP) and employment insurance (EI) contribution deductions again on their January paystubs. With the new CPP structures in place, there will be a p 2 larger increase in CPP and EI deductions and CPP will be a larger part of teachers’ retirement income. You can find more information on the Government of Canada's website. 

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Questions? Contact Teacher Employment Services at 1-800-232-7208. #WeAreATA