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Canada: Personal Taxation

Social Security Taxes

Employees pay Canada Pension Plan or Quebec Pension Plan contributions at a rate of 4.95% and C$5.025% of salary respectively, for 2012, between C$3,500 and C$50,100. This contribution is matched by the employer. Self-employed individuals are required to pay both employee and employer contributions, effectively paying 9.9% of income within the minimum and maximum earnings thresholds.

Employees also pay 1.83% (1.47% in Quebec) Employment Insurance on salary of up to C$45,900 (for 2012); employers contribute a multiple of 1.4 times the contribution made by the employee. The employer’s contribution can be reduced where it provides a short-term disability plan for its employees. From January 2010, self-employed individuals can make voluntary Employment Insurance contributions.

Some provinces and territories also require healthcare contributions, at varying rates.

 

 

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