Toronto 
Canada Revenue Agency has announced the 2022 limit for maximum pensionable earnings under the Canada Pension Plan.
The new ceiling will be $64,900 up from $61,600 in 2021.
The employee and employer contribution rates for 2022 will be 5.70% and the self-employed contribution rate will be 11.40%. The rates were 5.45% and 10.90% respectively in 2021.
The basic exemption amount for 2022 remains at $3,500.
The maximum employer and employee contribution to the plan for 2022 will be $3,499.80 each up from $3,166.45 in 2021 and the maximum self-employed contribution will be $6,999.60 up from $6,332.90 in 2021.
2022 contribution
| Maximum annual earnings for CPP | $64,900 |
| CPP contribution rate of employee, employer | 5.70% |
| CPP contribution rate for self-employed | 11.40% |
| Basic exemption amount | $3,500 |
| Maximum contribution amount for employee, employer | $3,499.80 |
| Maximum contribution amount for self-employed | $6,999.60 |
Effectively, the increase means if all other deductions and the annual salary remain the same as in 2021, your annual take-home amount will be less in 2022. As an example, if your annual salary remains $50,000, the CPP contribution in 2021 was $2534.25 [(50000-3500)*0.0545] and it will be $2650.50 [(50000-3500)*0.057] in 2022.
Those who earn more than $64,900 in 2022 are not required or permitted to make additional contributions to the CPP.
CRA says the new ceiling was calculated according to a CPP legislated formula that takes into account the growth in average weekly wages and salaries in Canada and the increase in contribution rate is due to the continued implementation of the CPP enhancement.
