CPP, CPP2 and EI for 2025

Another year, another yearly chestnut! CPP and EI Max return again! Remember, CPP2 is an enhancement to CPP (according to the government).

The EI rate max of 2025 is a little higher (as usual), and CPP remains the same. Was it following the inflation rate? Not the current rate of inflation.

What is CPP2?!? To enhance (excite?) CPP to be more for those who make more, there is now a second ceiling. This ceiling is $73,200, it will rise over time. Employees contribute 4% between the first earnings ceiling ($68,500) and the second ($73,200).

Now, this is the EI rate, not the AI rate. We are talking about Employment Insurance, not Artificial Intelligence. AI will come into play, no doubt, but not just yet.

There have been many arguments about how CPP and EI are tax. CPP is the Canada Pension Plan, and EI is Employment Insurance, so I’m not sure what they are getting at. It sounds like a rallying cry for those who feel their rights are being invaded.

Interest in this topic continues year-round. The EI rates for 2025 are slightly higher, but the CPP rate stayed the same.

Will 2025 be a better year? I will no longer comment on this area, as my prognostication skills are subpar. This past year has been quite significant. I do not wish to guess what 2024 might bring.

When we start 2025 (a new year), all who receive pay cheques begin paying CPP and EI premiums again. The Japanese term is Salaryman. Depending on how much you make, this might be a short-term issue or a year-long pain.

If you pay CPP and EI premiums all year, don’t worry; this is not for you. Read on for those who have an end date for your CPP premiums.

CPP, CPP2 and EI Max 2025

EI this year is again a bit lower:

• The maximum insurable earnings for 2025 is $65,700, up from $63,200 in 2024. This is the EI maximum insured income for the year. If you earn more than this and claim EI, your benefits will be based on this amount.
• The rates are changed from last year:
  • Workers rate (self-employed folks should research further, or if you live in Quebec) $1.64 per $100 earned.
  • Maximum premium paid $1,077.48. Once you reach this point, no more EI will be deducted from your pay
  • Max difference from 2024 is $28.36 more over the year.

CPP rates did not rise. However, the max earnings did go up.

• Maximum Pensionable Earnings: $71,300 (up from $68,500 in 2024)
• Employee Contribution Rate: 5.95 % (no increase this year)
• The maximum contribution for year: $4,034.10 ($8,068.20 if self-employed)

CPP2

• The ceiling for CPP2 for this year is $81,200.
• If you earn more than the first ceiling of $71,300, you will make 4% payments, up to a maximum of $396 (self-employed $792). These payments apply up to the second ceiling of $81,200.

When do I stop Paying?

A simple table of when you might stop paying EI and CPP. Find your estimated gross income in column 3; the first column should estimate when you stop paying.

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Past CPP & EI

Yes, it is a topic I write about, as it is essential to me. Here are a few from the past years to compare and contrast (hint see how much CPP has gone up).

• Only EI went up in 2024 but they are still taking it out too
• With Inflation roaring CPP and EI for 2023 went up
• For 2022 the CPP and EI Limits went up again
• The 2021 limits for CPP and EI were
• CPP and EI for 2020
• CPP and EI for 2019
• Merry New Year, CPP, EI and #MoneyTalk (2017)
• Gosh Darn it! CPP & EI Again!!! (2014)
• Fun with Numbers for 2013 (CPP and EI)
• Gosh Darn CPP and EI! (2010)
• Fun with Numbers with CPP and EI (2007)

Reference:

These are the sites I gleaned the information from

• Employment Insurance premium rate
• CPP contribution rates, maximums and exemptions

FAQ Answers for CPP, CPP2 & EI Maximums for 2025