26 pay periods per year
Gross Pay
$3,000.00
Net Pay
$2,215.62
Deductions
$784.38
Effective Rate
26.1%
What pay period types are available in Canada?
Canadian employers commonly use four pay frequencies: weekly (52 periods), bi-weekly (26 periods), semi-monthly (24 periods), and monthly (12 periods). Bi-weekly is the most common in Canada, with over 40% of employees paid on this schedule. Your employer determines the pay frequency, and it must comply with provincial employment standards for timely payment.
When do CPP and EI deductions stop during the year?
CPP contributions stop once you have contributed the annual maximum ($4,034.10 for CPP1, plus $396 for CPP2 if applicable). EI premiums stop at $1,077.48 ($862.38 in Quebec). This means if you earn a high salary, your paycheques later in the year may be noticeably larger because CPP and EI have already been maxed out. Your employer tracks this automatically.
How are payroll deductions calculated per period?
Your employer uses CRA payroll tables (or the Payroll Deductions Online Calculator) to determine the tax to withhold each pay period. The calculation annualizes your pay, determines the annual tax, then divides by the number of pay periods. CPP and EI are calculated directly on each period's earnings up to the annual maximum.
What is the difference between bi-weekly and semi-monthly?
Bi-weekly means every two weeks (26 pay periods per year), while semi-monthly means twice a month on fixed dates (24 pay periods). With bi-weekly pay, you receive two "extra" paycheques per year compared to semi-monthly. This can make budgeting different -- bi-weekly employees receive a slightly smaller per-period amount but two bonus months per year.
Why is my actual paycheque different from this estimate?
Several factors can cause differences: group benefits premiums (dental, health, life insurance), employer pension plan contributions, union dues, garnishments, or a TD1 form claiming additional tax credits. This calculator shows the statutory deductions only. Check your pay stub for a complete breakdown of all deductions.
CRA-Aligned: Uses official CRA payroll deduction rates for 2025. For precise payroll calculations, use the CRA Payroll Deductions Online Calculator.
How payroll deductions work and what comes off your paycheque
What is deducted from your paycheque?
Three main deductions come off every Canadian paycheque: federal and provincial income tax, CPP contributions (5.95% on earnings between $3,500 and $71,300), and EI premiums (1.64% on earnings up to $65,700). Your employer also deducts any amounts for benefits like pension plans, union dues, or group insurance. The net amount after all deductions is your take-home pay.
How does income tax withholding work?
Your employer uses CRA payroll tables to estimate how much tax to withhold from each pay period. The calculation assumes your current pay rate will continue for the full year. If you earn $2,000 per bi-weekly pay, your employer withholds as if you earn $52,000 annually. This means bonuses and overtime can trigger higher withholding because the system annualises that higher pay.
What is a TD1 form?
Form TD1 (Personal Tax Credits Return) tells your employer which personal tax credits to apply when calculating your withholding. You fill it out when you start a new job. It includes the basic personal amount ($16,129 federal for 2025) and any additional credits like the disability amount, caregiver amount, or tuition. A higher claim means less tax is withheld from each paycheque.
How often is payroll processed?
Pay frequency varies by employer: weekly (52 pay periods), bi-weekly (26 periods), semi-monthly (24 periods), or monthly (12 periods). Bi-weekly is the most common in Canada. Your annual salary is divided by the number of pay periods to determine your gross pay each period. Note that bi-weekly and semi-monthly are different — bi-weekly gives you two extra paycheques per year.
What are employer payroll obligations?
Employers must remit payroll deductions (income tax, CPP, and EI) to the CRA by specific due dates. Small employers remit monthly by the 15th of the following month. Larger employers may need to remit twice monthly or even within three days of payroll. Late remittances result in penalties of 3% to 10% plus daily interest.
What is the T4 slip?
The T4 slip (Statement of Remuneration Paid) is the Canadian equivalent of a pay summary. Your employer must issue it by the end of February each year. It shows your total employment income, income tax deducted, CPP contributions, EI premiums, and any taxable benefits. You need your T4 to file your income tax return.
What happens if too much or too little tax is withheld?
If too much tax was withheld during the year, you receive a refund when you file your tax return. If too little was withheld, you owe the difference. Common reasons for under-withholding include having multiple jobs, receiving taxable benefits, or not updating your TD1 form. You can request additional tax be withheld by completing Section 3 of Form TD1.
CRA-Aligned: Based on 2025 CRA rates and thresholds. For personal advice, speak to a qualified accountant or tax professional.
Disclaimer: This calculator provides estimates based on current CRA rates and thresholds for the 2025 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your individual circumstances. Always consult a qualified accountant before making financial decisions. Read our terms
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