Changes in Canada pension plans (“CPPs”) and other Pension Plans for 2020
Canada Revenue Agency announces maximum pensionable earnings and Employer, Employee contributions rate for Canada Pension Plan for 2020
|
Particulars |
2020 (In CAD) |
2019 (In CAD) |
|
The Maximum annual pensionable earnings under the Canada Pension Plan (“CPP”) |
58,700 |
57,400 |
|
The Basic Exemption Amount |
3,500 |
3,500 |
|
The Maximum contributory earnings under the Canada Pension Plan (“CPP”) |
55,200 |
53,900 |
|
The contribution rate for employee and employer (Each) |
5.25 % |
5.10 % |
|
The Maximum annual employee and employer contribution (Each) |
2,898.00 |
2,748.90 |
The rates mentioned in the previous newsletter for CPP were proposed and changed as mentioned above.
Contribution limits for various pension plans like registered pension plans (“RPP”), Registered retirement savings plans (“RRSP”) for 2020 are also revised marginally.
Implication
Employers are required to make necessary changes in their payroll to comply with the revised Canada Pension Plan threshold and rates.
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