Your CPP: what you pay and what you’ll get

Topic: Retirement · Part 2 of 13 · 🟡 Intermediate

In one sentence

This post explains who pays into the Canada Pension Plan, how much you pay in 2026, how to see your record, and how your future pension is worked out.

Words to know

Contribution: the money taken from your pay for CPP. Your employer pays the same amount.
YMPE (first earnings ceiling): the most earnings that count for the main CPP contribution in a year.
YAMPE (second earnings ceiling): a higher limit. Earnings between the two ceilings pay a second, smaller contribution, called CPP2.
Basic exemption: the first $3,500 you earn each year. You don’t pay CPP on it.
Statement of Contributions: your record of earnings and CPP payments, with an estimate of your pension.

Step 1: Know who pays into CPP

With very few exceptions, everyone aged 18 or older who works in Canada outside Quebec pays into CPP. You pay if you earn more than $3,500 a year.
Your employer takes it from your pay and adds the same amount.
If you are self-employed, you pay both parts yourself, based on your net business income.
Contributions stop at age 70, even if you keep working.
In Quebec, workers pay into the Quebec Pension Plan (QPP) instead.

Step 2: See how much you pay in 2026

Here are the 2026 numbers for employees. Checked October 2026.

2026 CPP figure	Amount
Basic exemption	$3,500
First earnings ceiling (YMPE)	$74,600
Main contribution rate (employee, and the same for the employer)	5.95%
Maximum main contribution (employee)	$4,230.45
Second earnings ceiling (YAMPE)	$85,000
CPP2 rate on earnings between $74,600 and $85,000	4%
Maximum CPP2 contribution (employee)	$416.00
Self-employed rates	11.9% and 8% (both parts)

You can check the maximum: ($74,600 − $3,500) × 5.95% = $71,100 × 0.0595 = $4,230.45. And for CPP2: ($85,000 − $74,600) × 4% = $10,400 × 0.04 = $416.

Step 3: Understand the enhanced CPP

Since January 1, 2019, CPP has been slowly growing. This is called the CPP enhancement. Workers pay a little more, and in return they will get a bigger pension. CPP2 started on January 1, 2024. If you started working in Canada after 2019, all your years count toward the enhanced part. This is good news for younger workers, and for people who moved to Canada recently.

Step 4: See your Statement of Contributions

Sign in or register for My Service Canada Account on canada.ca.
Go to the Canada Pension Plan section.
Choose “View my contributions” to see your full record, or “View my benefit estimates” to see your estimate.
Compare the earnings with your T4 slips. Check your name and date of birth too.
If something is wrong or missing, contact CPP soon.

You can also ask for a copy by mail. If you live in Quebec, or only worked there, contact Retraite Québec instead.

Step 5: Learn how your pension is estimated

Your CPP pension depends on three main things:

How much and how long you paid in.
Your average earnings over your working life.
The age you start. You can start between 60 and 70. Before 65, your pension goes down by 0.6% for each month early, up to 36% at 60. After 65, it goes up by 0.7% for each month you wait, up to 42% at 70.

CPP also leaves out some low-earning years. For the base part, it can drop up to 8 years with your lowest earnings. For the enhanced part, it uses your best 40 years. There are also rules for years spent raising young children.

In 2026, the maximum CPP pension at 65 is $1,507.65 a month. Few people get the maximum. The average for new pensioners at 65 was $858.34 a month in July 2026. To choose your start age, see When to start CPP: 60, 65 or 70?

Example

Say you earn $50,000 in 2026 as an employee. First, take off the basic exemption: $50,000 − $3,500 = $46,500. Then multiply by the rate: $46,500 × 5.95% = $46,500 × 0.0595 = $2,766.75. That is your CPP for the year. Your employer pays another $2,766.75. You earn less than $74,600, so you pay no CPP2.

Common mistakes

Never checking your Statement of Contributions until you retire.
Thinking you will get the maximum pension. Most people get less.
Forgetting that self-employed people pay both parts.
Not knowing that work in another country may help you qualify. See social security agreements.

✅ My checklist

☐ I know how much CPP comes off my pay
☐ I signed in to My Service Canada Account
☐ I looked at my Statement of Contributions
☐ I compared it with my T4 slips
☐ I know my pension depends on my start age

Next in this topic → OAS for immigrants: the residence rule

Back to the topic → Retirement

There are no affiliate or referral links in this post. This is general information, not financial, tax or legal advice; everyone’s situation is different. Figures were checked in October 2026 and can change.

Sources: CRA: CPP contribution rates, maximums and exemptions · Canada.ca: CPP enhancement · Canada.ca: Contributions to the CPP · Canada.ca: Statement of contributions · Canada.ca: CPP retirement pension amount · Canada.ca: When to start your CPP pension · ESDC: Maximum benefit amounts, 2026