CRA Payroll Deductions Calculator (Federal)

Enter your annual employment income to calculate your 2026 federal payroll deductions: federal income tax, CPP, CPP2, and EI.

CRA Payroll Deductions Calculator (Federal)

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Annual employment income (CAD)

Federal income tax	$7,496.72
CPP contribution	$3,956.75
CPP2 contribution	$0.00
EI premium	$1,123.07
Total federal deductions	$12,576.54
Take-home (federal only)	$57,423.46

Federal deductions only. Provincial/territorial income tax is calculated separately using each province's own brackets and is NOT included in this total - your actual take-home pay will be lower once provincial tax is applied. Quebec uses a different EI rate (QPIP) not reflected here.

The 2026 federal rates used

Federal tax brackets (2026): 14% to $58,523 - 20.5% to $117,045 - 26% to $181,440 - 29% to $258,482 - 33% above Basic Personal Amount: $16,452 (full, income under $181,440) down to $14,829 (income over $258,482, phased linearly between) CPP: 5.95% on earnings between $3,500 and $74,600 (max $4,230.45) CPP2: 4% on earnings between $74,600 and $85,000 (max $416.00) EI: 1.63% on earnings up to $68,900 (max $1,123.07, no basic exemption)

Example

$70,000 annual income: federal tax $7,496.72, CPP $3,956.75 (below the maximum, since $70,000 is still under the $74,600 YMPE ceiling), no CPP2 (income below $74,600), EI $1,123.07 (at the maximum, since $70,000 exceeds the $68,900 insurable ceiling) - total federal deductions of about $12,576.54, leaving roughly $57,423 before provincial tax.

Why this covers federal only, not your full paycheck

Canada's payroll deduction system has two layers: federal (which applies identically everywhere in Canada) and provincial/territorial (which each of the 13 provinces and territories sets independently, with its own brackets and rates). This calculator covers the federal layer precisely - federal income tax, CPP, CPP2, and EI - because those numbers are the same no matter where in Canada you work. Provincial tax is a separate calculation on top of this, using your specific province's own bracket structure, which varies significantly (for example, Alberta's brackets run 8%-15%, while other provinces differ). Your actual take-home pay will be lower than what's shown here once provincial tax is subtracted too.

Common mistakes

Applying the CPP $3,500 basic exemption logic to EI - EI has no basic exemption and applies from the first dollar of insurable earnings, unlike CPP.

Forgetting Quebec uses a different EI rate - Quebec's provincial parental insurance plan (QPIP) covers parental benefits separately, so Quebec employees pay a lower federal EI rate than the rest of Canada.

Frequently asked questions

Why doesn't this include my provincial tax?

Each of Canada's 13 provinces and territories sets its own tax brackets independently, so there's no single "provincial rate" to apply. This calculator focuses on the federal deductions that are identical everywhere in Canada; your province's own tax adds an additional deduction on top of these figures.

What is CPP2 and why is it separate from regular CPP?

CPP2 is a second, additional CPP contribution layer phased in starting 2024, applying only to earnings between the YMPE ($74,600) and a higher second ceiling (YAMPE, $85,000) at a separate 4% rate. It only affects higher earners whose income exceeds the first CPP ceiling.

Does self-employment change these calculations?

Yes significantly for CPP - self-employed individuals pay both the employee and employer portions of CPP (11.9% combined instead of 5.95%), since there's no separate employer to match the contribution. EI is generally optional for the self-employed.

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