Navigating CPP in 2026: What BC Businesses Need to Know
CPP contributions change every year, and 2026 brings some meaningful increases that every BC business owner running payroll needs to know about. Open Road Accounting and Payroll Solutions has pulled together the current numbers — straight from the CRA — so you can make sure your payroll is set up correctly and your employees aren’t caught off guard.
CPP1 Contribution Rate — Still 5.95%: The employee and employer contribution rate holds steady at 5.95% for 2026, the same as 2025. What has changed is the maximum pensionable earnings ceiling, which means higher earners and their employers will see larger dollar contributions this year even though the rate itself hasn’t moved.
Higher Maximum Pensionable Earnings (YMPE) for 2026: The YMPE has increased to $74,600 in 2026 (up from $71,300 in 2025). The basic exemption stays at $3,500, making the maximum contributory earnings $71,100. The maximum annual contribution for both employees and employers is $4,230.45, and self-employed individuals will contribute up to $8,460.90. Make sure your payroll software is updated with these new figures.
CPP2 — The Second Additional Contribution Is Here to Stay: Since January 1, 2024, employees earning above the YMPE are also subject to CPP2 contributions on earnings up to the additional YMPE (AYMPE). For 2026, the AYMPE is $85,000, meaning CPP2 contributions apply on earnings between $74,600 and $85,000. The CPP2 rate is 4% for both employees and employers, with a maximum annual contribution of $416 each ($832 for self-employed). This is a separate calculation from CPP1 and must be tracked and remitted independently.
Impact on Your Employees’ Retirement Planning: With higher contribution amounts in 2026, employees — especially higher earners subject to both CPP1 and CPP2 — will see more deducted from each paycheque. The upside is a higher projected CPP benefit down the road. It’s worth having an open conversation with your team about what these changes mean for their take-home pay, particularly if wages are close to or above the $74,600 YMPE threshold.
Compliance and Remittance Deadlines: Getting the numbers right is only half the job — remitting on time is equally important. CRA remittance schedules haven’t changed, but with CPP1 and CPP2 now running in parallel, errors in calculation are more common than ever. Open Road Accounting and Payroll Solutions can help make sure your payroll processes are accurate, your remittances are on time, and you’re not carrying unnecessary penalty risk.
CPP changes every year, and keeping your payroll current with the latest CRA figures is one of those things that’s easy to let slip — until it isn’t. The 2026 numbers are confirmed and in effect now. As for 2027, the CRA typically announces the new YMPE and contribution maximums in November of the prior year, so watch for that announcement in fall 2026. We’ll update this post as soon as those numbers are available. In the meantime, if you have questions about how these changes affect your payroll setup, we’re always happy to talk. Book a call with us directly from our website at openroadaccounting.ca. All figures in this post are sourced directly from the CRA: canada.ca/cpp-contribution-rates.