What are the changes to the CPP contribution rules?

Previous rules

Under the previous rules (before January 1, 2012), as an employer you had to stop deducting CPP contributions from an employee's pensionable earnings when the employee:

• was 60 to 70 years of age; and
• gave you proof that he or she was receiving a CPP or Quebec Pension Plan (QPP) retirement pension (for example, an award letter issued by Human Resources and Skills Development Canada).

For more information, go to Employees who are 60 to 70 years of age.

New rules

Since January 1, 2012, you may have to deduct CPP contributions from the pensionable earnings you pay an employee who is 60 to 70 years of age, even if the employee is receiving a CPP or QPP retirement pension.

Under the new rules, an employee who works and receives a CPP or QPP retirement pension now has to contribute to the CPP if he or she is:

• 60 to 65 years of age;
• 65 to 70 years of age, unless the employee has filed an election with you or another employer to stop paying CPP contributions (the election will take effect on the first day of the month following the month the employee provides you with a completed and signed election form);
• 65 to 70 years of age, if the employee revoked his or her election to stop paying CPP contributions in 2013 or later.

Notes
These legislative amendments do not affect the salary or wages of an employee who is considered to be disabled under the CPP or QPP, nor do they affect the salary and wages of a person who has reached 70 years of age. Do not deduct CPP contributions from the salary and wages that you pay these employees.

Employees working in Quebec and other workers not subject to the CPP are not affected by these changes.

You have to deduct CPP contributions from an employee who is employed in pensionable employment and is receiving pensionable earnings, and meets one of these conditions:

• who is currently receiving a CPP or QPP retirement pension and is 60 to 65 years of age, even if it means deducting from someone who was not contributing in a previous year because he or she was receiving a CPP/QPP retirement pension;
  OR
• who is currently receiving a CPP or QPP retirement pension and is 65 to 70 years of age, and who has not given you a copy of a signed and completed Form CPT30, Election to Stop Contributing to the Canada Pension Plan, or Revocation of a Prior Election.

Note
The CRA can assess you for failing to deduct CPP contributions or for failing to remit the CPP contributions to the CRA as required. The assessment may also include penalty and interest charges. For more information, go to Penalties, interest, and other consequences.

Forms and publications

• Form CPT30, Election to Stop Contributing to the Canada Pension Plan, or Revocation of a Prior Election
• Schedule 8, CPP Contributions on Self-Employment and Other Earnings
• Form CPT20, Election to Pay Canada Pension Plan Contributions

Related topics

• Changes to the Canada Pension Plan (CPP) for individuals who are 60 to 70 years of age

Government partners

• Service Canada
• Human Resources and Skills Development Canada