Payroll Tax Calculator: Employer Costs in Canada

An employer pays more than an employee’s salary: it pays its own share of CPP and a larger share of EI. This calculator shows those employer contributions for one employee in any province or territory, using the 2026 rates in this site’s data. The employee’s side (what comes off their pay) is on the withholding tax calculator; both are part of the income tax hub.

What employers pay on top of salary

CPP. Your employer deducts CPP contributions from your pensionable earnings and contributes an equal amount itself, and handles the second additional contribution (CPP2) the same way; if you are self-employed, you pay both the employee and employer shares. Employers in Quebec deduct QPP contributions instead. For the employee and the employer each, that is 5.95% of earnings between $3,500 and $74,600, up to $4,230.45 per employee for 2026.

CPP2. The second additional contribution has the same employee and employer rate, 4% of earnings from $74,600 to $85,000, up to $416.00 each.

EI. For 2026, you pay 1.4 times the EI premiums you deduct: 2.282% of insurable earnings up to $68,900, a maximum of $1,572.30 per employee. Employers with a qualifying short-term disability plan can register for a reduced rate.

Quebec. Employers with employees in Quebec deduct QPP instead of CPP, deduct EI at Quebec’s reduced rate (the employer pays 1.82%, up to $1,253.98), and also deduct QPIP premiums. QPP, QPIP and Quebec income tax are sent to Revenu Québec; CPP, EI and federal tax go to the CRA. The calculator includes the employer’s QPP and EI but not its QPIP premium.

Provincial payroll taxes

Some provinces tax an employer’s total payroll. The rules for three of them:

• Ontario Employer Health Tax. Eligible employers (broadly, employers that pay income tax and aren’t controlled by a government) can exempt the first $1,000,000 of Ontario payroll, an exemption associated employers share; there is no exemption for an employer (or associated group) with more than $5,000,000 of annual payroll, unless it is a registered charity. The rate runs from 0.98% on payroll up to $200,000 to 1.95% over $400,000, set by total payroll before the exemption, and applies to payroll minus the exemption. An eligible employer with $1,300,000 of Ontario payroll pays the top rate on $1,300,000 minus the exemption: $5,850 of EHT.
• British Columbia Employer Health Tax. No tax on B.C. payroll of $1,000,000 or less; between that and $1,500,000, 5.85% of the payroll above $1,000,000; above $1,500,000, 1.95% of the whole payroll.
• Manitoba Health and Post Secondary Education Tax Levy. Employers with yearly payroll of $2,500,000 or less are exempt; between that and $5,000,000, the levy is 4.3% of the amount above $2,500,000; above $5,000,000, it is 2.15% of total payroll.

In British Columbia and Manitoba too, associated employers share one exemption, and an employer with a permanent establishment in the province for only part of the year prorates it; British Columbia has separate rules for charitable and non-profit employers. These are payroll-wide taxes, so they don’t appear in the per-employee calculator above. Quebec and other provinces have their own employer contributions, which this page doesn’t cover.

Remitting and reporting

• Remittances. You send the CPP, EI and income tax you deduct, plus your own CPP and EI share, to the CRA. A regular remitter (average monthly withholding under $25,000) remits on or before the 15th day of the month after the month you paid your employees; larger and smaller remitters have other schedules set by the CRA. A payment due on a Saturday, Sunday or public holiday is on time if the CRA receives it on the next business day.
• T4 slips. The T4 information return is due on or before the last day of February of the following calendar year, or the next business day if that day falls on a Saturday or Sunday.

What the calculator leaves out

The employer’s QPIP premium in Quebec, provincial payroll taxes, workers’ compensation premiums (set by each province’s board by industry), vacation pay and benefits all add to the cost of an employee and are not included. Vacation pay rules are on the vacation pay page.

Related calculators

• Withholding tax calculator: the employee’s deductions per paycheque
• Salary after tax calculator: the employee’s take-home pay
• Income tax calculator: tax on employment and other income
• Self-employed tax calculator: when you pay both shares of CPP yourself
• EI contribution rates: EI premiums in detail