On September 8, 2023, the CRA updated the T4127-JUL Payroll Deductions Formulas - 118th Edition - Effective July 1, 2023.
Appendix 2 of the guide has been updated in order to provide additional information to users ahead of the implementation of the second additional CPP contribution in January 2024.
As per Canada Pension Plan Regulations Subsection 5.1 (1), for the year 2024 and each subsequent year, pensionable earnings up to the second earnings ceiling are subject to the second additional CPP contributions.
The new formulas and factors for 2024 were initially published in Appendix 2 of the 116th Edition of the T4127; they have been reproduced in Appendix 1 of this guide. Examples illustrating the new factors have been added in Appendix 2 in order to allow users to test their systems ahead of the legislated implementation in January 2024. A theoretical Year's Additional Maximum Pensionable Earnings (YAMPE) and maximum contribution have been used based on the 2023 Year's Maximum Pensionable Earnings (YMPE).