Why CPP and EI Deductions Stop During the Year
When your CPP or EI line disappears from your stub, it is not an error — here is why it happens.
Written and reviewed by Rocco Clayfield, Founder & DirectorLast reviewed
Short answer
CPP and EI deductions stop once you earn enough in a calendar year to hit the annual ceiling set by the government. For CPP, this ceiling is called the Year's Maximum Pensionable Earnings. For EI, it is the Maximum Insurable Earnings. Both ceilings are reviewed and updated each year. Once you reach a ceiling, no further CPP or EI is deducted for the rest of that year, and your take-home pay increases slightly.
Most workers notice it sometime in the late summer or fall: the CPP or EI line on their pay stub suddenly shows zero, or disappears entirely. If you are not expecting it, it can look like an error. It is not — it is the annual maximum mechanism working exactly as intended.
Understanding how these ceilings work helps you budget for the mild take-home pay increase when deductions stop, verify that your employer is applying the maximums correctly, and understand what CPP2 is if it has started appearing on your stub.
This guide covers CPP, CPP2, and EI maximums for workers across Canada, with notes on the Quebec QPP and QPIP equivalents.
What this page helps you check
- Understand why CPP and EI deductions stop partway through the year
- Learn the difference between maximum pensionable earnings (CPP) and maximum insurable earnings (EI)
- Understand what CPP2 is and when it appears on your stub
- Recognise what a legitimate deduction stop looks like on a pay stub
- Know how to verify that your YTD CPP and EI match the expected annual maximum
- Understand how the maximums reset in January
- Know what happens if you change jobs mid-year and whether over-deductions are possible
How CPP Maximums Work
The Canada Pension Plan has an annual ceiling on the earnings from which contributions are taken. This ceiling is called the Year's Maximum Pensionable Earnings (YMPE). Each year, the CRA sets the YMPE and the corresponding employee contribution rate. Your employer deducts CPP as a percentage of your pensionable earnings each pay period, stopping once your cumulative pensionable earnings for the year reach the YMPE.
There is also a basic exemption — a small amount of earnings at the bottom that is not subject to CPP. The actual contributions are calculated on earnings between the basic exemption and the YMPE. Your payroll system handles this automatically; you will not usually see the exemption as a separate line.
Once your YTD pensionable earnings reach the YMPE, the CPP line on your stub will show zero or be absent for the rest of the calendar year. In January, the counter resets and deductions resume. For the current YMPE and rate, visit canada.ca.
CPP2 — The Second Tier of CPP
Since 2024, a second tier of CPP contributions has applied to earnings above the first YMPE and up to a second, higher ceiling called the Year's Additional Maximum Pensionable Earnings (YAMPE). The rate for CPP2 is set by the government and differs from the first-tier rate.
Not every employee will see CPP2 each pay period. It only applies once your earnings for the year have exceeded the first YMPE. Higher-earning workers will see CPP2 appear on their stubs after the first-tier maximum is reached and continue until the YAMPE is hit.
If you see both CPP and CPP2 on a stub, they are not a duplication error. They are two distinct contributions covering two different earnings tiers, both going toward your eventual CPP retirement benefit. For current YAMPE figures, see the CRA website.
How EI Maximums Work
Employment Insurance uses a similar ceiling called the Maximum Insurable Earnings (MIE). Your employer deducts EI premiums as a percentage of your insurable earnings each period, stopping once your cumulative insurable earnings for the year reach the MIE.
The EI maximum is reviewed annually by the Employment Insurance Commission. The rate and maximum are published each fall for the following year. Once you reach the MIE, EI deductions stop for the rest of the calendar year and restart in January.
Employer EI premiums are separate — employers pay approximately 1.4 times the employee rate on the same insurable earnings. The employer portion does not appear on your stub and does not affect your net pay.
What the Maximum Stop Looks Like on Your Stub
In the pay period when you first reach the maximum, you may see a partial deduction — you only owed contributions up to the ceiling, not a full period's worth. Subsequent stubs will show zero or no line for that deduction.
Your YTD column is the best way to confirm the stop is legitimate. When CPP stops, your YTD CPP should be approximately equal to the expected annual maximum contribution (not the YMPE, but the contribution amount derived from it). If the YTD CPP stops well below the expected maximum, that could suggest a system issue. If it continues above the maximum, that is also worth checking.
The exact annual contribution amounts change each year. Visit canada.ca for current figures rather than relying on figures from a previous year.
Changing Jobs Mid-Year and the Risk of Over-Contributions
Each employer tracks your CPP and EI deductions independently within their own payroll system. If you change jobs or work two jobs simultaneously, each employer applies the maximums based only on the earnings they have processed — they do not know what your other employer deducted.
The result is that you may contribute more in total than the annual maximum. This is called an over-contribution. The excess is credited to you when you file your income tax return with the CRA — you do not need to contact either employer to correct it.
Keep your T4 slips from all employers in a year where you changed jobs. Both slips will show CPP and EI deducted, and if the combined total exceeds the annual maximum, your tax return will generate a credit for the over-payment.
What Happens to Your Net Pay When Deductions Stop
When CPP stops, your net pay increases by the amount of the CPP deduction for that period. If EI also stops at around the same time, the combined effect can be a noticeable step up in take-home pay for the last few months of the year.
This is not a raise and it is not permanent — deductions restart in January. Many workers find it useful to set aside part of the increase rather than adjusting their spending upward, since the reduction will happen again in the new year.
If both CPP and EI stop at the same time and you also have a CPP2 that is still active, you will still see CPP2 deducted until that ceiling is also reached.
2026 rates at a glance
Confirmed from official sources as of June 2026. Rates change every January — always check the linked official source for the current figures before relying on them.
CPP — base plan (2026, outside Quebec)
| Year's Maximum Pensionable Earnings (YMPE) | $74,600 |
| Basic annual exemption | $3,500 |
| Employee contribution rate | 5.95% |
| Maximum employee contribution | $4,230.45 |
CPP2 — second additional contribution (2026)
| Applies to earnings between(YMPE to YAMPE) | $74,600 and $85,000 |
| Contribution rate | 4.00% |
| Maximum employee CPP2 contribution | $416.00 |
Province & territory note
Quebec works differently
Common red flags worth checking
These do not automatically mean there is an error. They are simply lines worth a closer look, or worth asking payroll to explain.
CPP or EI stops much earlier in the year than expected
If your deductions stop in, say, April or May and your income is moderate, your YTD figures may be higher than expected due to a payroll error, an incorrect annual salary in the system, or a prior-period correction. Check the YTD CPP or EI figure against the known annual maximum.
CPP or EI continues well into the fall on a salary that should have hit the maximum
If your income is well above the YMPE or MIE and deductions are still being taken late in the year, the payroll system may have an incorrect maximum set. Ask payroll to verify the maximum figures in their system.
You see a large CPP deduction in January on the first stub of the year
CPP deductions should restart at the normal per-period rate in January, not catch up for a previous year. A large first-of-year deduction may indicate a correction entry. Ask payroll what the entry represents.
Both CPP and CPP2 appear but you are a lower-income earner
CPP2 only applies above the first YMPE ceiling. If it appears on a stub where your YTD earnings have not reached that ceiling, it may be a payroll system configuration issue worth clarifying.
Over-deduction across two employers is very large
A small over-contribution from two jobs is expected and resolved at tax time. A very large over-contribution may indicate one employer applied an incorrect rate or maximum. Keep both T4s and let the tax return process handle the credit.
EI stops but CPP is still far below the expected maximum
CPP and EI have different ceilings. It is common for one to stop before the other. This is not an error. Compare each YTD figure against its respective maximum independently.
Want this checked on your real pay stub?
Upload your pay stub or payroll document and get a plain-English breakdown with possible questions to ask payroll.
What to ask payroll or HR
Calm, specific questions get clearer answers. You can copy any of these, or build a full message with the Payroll Message Generator.
- “My CPP stopped this period — can you confirm the YTD CPP matches the expected annual maximum?”
- “I have two jobs this year. Is there a risk of over-contributing to CPP or EI, and how does the credit work?”
- “CPP2 appeared on my stub for the first time. Can you confirm it is set up correctly and explain which ceiling it relates to?”
- “My EI is still being deducted and I believe I should have hit the MIE by now. Can you check the maximum in your system?”
- “In January my first stub had a larger-than-usual CPP deduction. What does that entry represent?”
- “Where can I see the current CPP and EI maximums that your payroll system is using this year?”
Frequently asked questions
Why does my net pay go up partway through the year?
When your CPP or EI contributions reach the annual maximum, the deduction stops for the rest of the year. This increases your net pay by the amount of the deduction that would otherwise have been taken. Deductions restart in January.
What is the YMPE?
The Year's Maximum Pensionable Earnings is the income ceiling above which CPP contributions are no longer required for the first tier. The CRA sets this figure annually. You can find the current YMPE at canada.ca.
What is the MIE?
The Maximum Insurable Earnings is the income ceiling above which EI premiums are no longer required. It is set annually by the Employment Insurance Commission and published on the canada.ca website.
What is CPP2 and how is it different from CPP?
CPP2 is a second tier of Canada Pension Plan contributions that applies to earnings above the first YMPE and up to a second, higher ceiling. It was introduced as part of the CPP enhancement. The contribution rate for CPP2 is lower than for the first tier. It results in a higher CPP retirement benefit for those who contribute.
I changed jobs mid-year. Will I over-pay CPP and EI?
Possibly. Each employer applies the maximum based on what they have paid you — they do not know what your previous employer deducted. If the combined deductions across both employers exceed the annual maximum, you will receive a credit on your tax return. No action is needed with either employer.
Does CPP stop at the same time as EI each year?
Not necessarily. The YMPE and MIE are different figures, and your deductions stop independently when each ceiling is reached. It is common to see one stop before the other.
In Quebec, does the QPP work the same way?
QPP serves the same purpose as CPP and also has an annual maximum pensionable earnings ceiling. The specific figures and rates differ from federal CPP. Check retraitequebec.ca for current QPP parameters.
How do I know if the maximum in my employer's payroll system is correct?
Compare your YTD CPP or EI on the stub where deductions stopped against the published annual maximum contribution (not the earnings ceiling). Both are available on canada.ca. If there is a significant discrepancy, ask payroll to verify their system settings.
Official sources for this page
Every figure here is derived from these. Where a number matters to you, read it at the source — PayStub IQ Canada explains the rules, it does not set them.
- CPP contribution rates, maximums and exemptions — Canada Revenue Agency
- EI premium rates and maximums — Canada Revenue Agency
- The CPP enhancement and the second additional contribution (CPP2) — Canada Revenue Agency
Get told when Canadian payroll rates change
Seven provinces and territories have already published a minimum wage increase for the next few weeks, and every federal and provincial figure is re-indexed each January. One short email when a rate actually changes. Nothing else, ever.
Related guides & checkers
Helpful guidance, not advice
PayStub IQ Canada provides educational payroll explanations based on the information visible in your document. It does not provide legal, tax, accounting, payroll, CRA, Revenu Québec, or employment standards advice. For official decisions or corrections, contact your employer, payroll department, CRA, Revenu Québec, your provincial or territorial employment standards office, or a qualified professional.