Canada Revenue Agency
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Box 26 - CPP/QPP pensionable earnings
Starting in January 2012 (for the 2011 tax year), box 26 must always be completed. In most cases, boxes 14 and 26 should be the same amount. You have to complete the box in all situations, up to the maximum pensionable earnings for the year.
If there are no pensionable earnings, enter "0" in box 26. For exempt employment, enter "0" and see Box 28 - Exempt (CPP/QPP, EI and PPIP).
CPP
The following types of remuneration are included in box 14, "Employment income", but are not included in box 26, "CPP/QPP pensionable earnings":
- Remuneration paid to the employee:
- before and during the month the employee turned 18. You should have started to calculate the CPP contributions and pensionable earnings effective the first pay dated on or after the first of the month following the employee's 18th birthday, (for example, an employee who turns 18 in October will have CPP deductions withheld from the first pay in November);
- after the month the employee turned 70. You should have stopped calculating the CPP contributions and pensionable earnings after the last pay date in the month of the employee's 70th birthday;
- during the months the employee was considered to be disabled under the CPP or QPP; or
- after January 1, 2012, if the employee is at least 65 years of age but under 70, is receiving a CPP or QPP retirement pension, and has elected to stop contributing to the CPP. You should calculate the CPP contributions and pensionable earnings based on the number of months before and including the month the employee elected to stop contributing to the CPP.
- Remuneration paid to the employee while the employee worked in "excluded employment". For more information, go to Special payments chart.
- Amounts for a clery member's residence from which you did not deduct CPP contributions (if the clergy member gets a tax deduction for the residence, CPP contributions are not required).
- Any excluded income, benefits, or payments described in the Special payments chart.
- Amounts for non-taxable Indian employees for whom you elected to pay CPP.
Subtract any of the amounts noted above from the amount in box 14, and enter the difference in box 26. Do not change the amount in box 14.
Note
Taxable benefits only (not including security option benefits) – If you provide pensionable taxable benefits (non-cash) and no other remuneration is paid in a tax year (for example, an employee is on an unpaid leave of absence and the employer continues to provide benefits during the leave), enter "0" in box 26. For security option benefits, report the amount of the benefit in box 26 at all times. Do not code the slip CPP-exempt in box 28, since the employee may want to elect to pay CPP on the amount.
Special rules may apply in certain situations. Please refer to the Special payments chart or the specific page for prescribed plans or arrangements, placement or employment agency workers, or Indians.
QPP
Regardless of the employee's province or territory of residence, complete box 26 if the employee is subject to QPP. If the maximum QPP pensionable earnings for the year have been reached on the RL-1 for the employee, but the income in box 14 of the T4 is less than the maximum pensionable amount, enter the maximum pensionable earnings amount in box 26.
Revenu Québec considers certain benefits and earnings to be pensionable earnings for employees working in Quebec. These include:
- private health benefit plan premiums; and
- assumed earnings – persons 55 years of age or older whose hours of work are reduced by reason of phased retirement may choose, with their employers, to make contributions to the QPP on all or part of the amount of the reduction in remuneration.
For details, see Guide TP-1015.G-V, Guide for Employers - Source Deductions and Contributions or brochure IN-253-V, Taxable Benefits, which you can get from Revenu Québec.
