6.6 Chapter Summary and Additional Readings and Resources

6.6.1 Chapter Summary

Employer payroll expenses can be a significant cost that employers should not underestimate. Payroll expenses include employer CPP contributions, employer EI premiums, WCB premiums, and, where applicable, employer payroll tax.

Employer CPP contributions are calculated by matching employees’ contributions one-to-one, and employer EI premiums are calculated as 1.4 times the employee premium.

Workers’ compensation premiums are contributions made by employers to fund a no-fault compensation scheme for work-related injuries or illnesses. Premiums are based on factors such as industry classification, payroll size, and historical injury claims.

Certain Canadian provinces levy employer payroll taxes to fund health care and/or post-secondary education systems. Rates and exemptions for employer payroll taxes vary by province.

6.6.2 Additional Readings and Resources

CanPay Software. (n.d.). Provincial payroll tax. https://www.canpay.com/payroll-information/provincial-payroll-tax.html

Government of Canada. (2024a). Calculate payroll deductions and contributions: EI premium rates and maximums. https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-deductions-contributions/employment-insurance-ei/ei-premium-rates-maximums.html

Government of Canada. (2024b). Line 22200 – Deduction for CPP or QPP contributions on self-employment income and other earnings. https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-22200-deduction-cpp-qpp-contributions-on-self-employment-other-earnings.html

Government of Canada. (2023a). Calculate payroll deductions and contributions: CPP contribution rates, maximums and exemptions. https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-deductions-contributions/canada-pension-plan-cpp/cpp-contribution-rates-maximums-exemptions.html

Government of Canada. (2023b). EI premium reduction guide Chapter 5: Your responsibilities once a premium reduction is granted. Employment and Social Development Canada. https://www.canada.ca/en/employment-social-development/programs/ei/ei-list/reports/reduction-program/responsibilities.html

Government of Canada. (2023c). EI premium reduction program: For employers. Employment and Social Development Canada. https://www.canada.ca/en/employment-social-development/programs/ei/ei-list/ei-employers/premium-reduction-program.html

Government of Canada. (2021). Contributions to the Canada Pension Plan. https://www.canada.ca/en/services/benefits/publicpensions/cpp/contributions.html