Why your pay stub differs from the yearly figure

Payroll taxes each pay as if it were repeated all year

Payroll software follows the CRA's payroll deductions formulas (T4127). Each pay's taxable income is multiplied by the number of pays in the year, taxed, and divided back. A raise, overtime or a one-off payment changes that pay's tax. The yearly calculator uses your actual income for the year.

CPP and EI stop once you reach the yearly maximum

On a stub, CPP and EI come off every pay until your year-to-date total reaches the maximum, then stop. On $90,000 paid every two weeks ($3,461.54 a pay), the stub shows CPP of $197.95 and EI of $56.42 a pay. EI reaches its $1,123.07 maximum in pay 20 and CPP its $4,230.45 maximum in pay 22, so the last few pays of the year are larger. The yearly figure spreads the same totals evenly.

CPP2 starts only after your pay for the year passes $74,600

CPP2 appears on stubs only once your year-to-date pensionable earnings pass $74,600. On $90,000 it starts in pay 22 and comes to $416.00 by December. The first additional CPP and CPP2 lower the taxable income of only the pays they are taken from.

Each pay gets a share of the $3,500 exemption

The CPP basic exemption is divided between pays: $3,500 ÷ 26 = $134.62 on a bi-weekly payroll. Years with 27 bi-weekly pays, or starting a job part-way through the year, change the per-pay figures.

BC, Newfoundland and Labrador and PEI changed their 2026 rules part-way through the year

When a province changes a rate or amount for the whole of 2026 part-way through the year, payroll keeps the old figure until the change and then uses a prorated one for the rest of the year, so that the two halves average out to the new figure. BC payroll used a 5.06% lowest rate and a $575 tax reduction from January to June, then 6.14% and $805 from July. Newfoundland and Labrador payroll used an $11,188 basic personal amount, then $15,000. PEI payroll used 19% on taxable income over $200,000, then 21%. CRA: T4127 Payroll Deductions Formulas, 123rd edition (July 2026).

This calculator uses the CRA's full-year 2026 figures: 5.60% and $690 in BC, $13,094 in Newfoundland and Labrador and 20% in PEI. The PEI rate and the Newfoundland and Labrador amount are as the CRA applies them; we could not confirm the provincial legislation. Individual 2026 pay stubs in these provinces will not match the yearly figure divided evenly.

Rounding makes a difference of cents

Payroll rounds each amount to the cent and uses tax constants rounded to whole dollars. We ran the CRA's Payroll Deductions Online Calculator for one bi-weekly pay dated 23 October 2026, with basic personal amounts and no year-to-date amounts:

Pay and item	One pay (CRA)	One pay × 26	Our yearly figure
Ontario $60,000: federal tax	$205.32	$5,338.32	$5,338.30
Ontario $60,000: Ontario tax	$114.68	$2,981.68	$2,982.20
Ontario $60,000: CPP	$129.30	$3,361.80	$3,361.75
Ontario $60,000: EI	$37.62	$978.12	$978.00
Ontario $60,000: take-home	$1,820.77	$47,340.02	$47,339.75
Nova Scotia $70,000: federal tax	$279.93	$7,278.18	$7,278.19
Nova Scotia $70,000: Nova Scotia tax	$274.82	$7,145.32	$7,145.72
Nova Scotia $70,000: CPP	$152.18	$3,956.68	$3,956.75
Nova Scotia $70,000: EI	$43.88	$1,140.88	$1,123.07

Income tax and CPP match within $1 a year. Nova Scotia EI differs because a stub takes 1.63% every pay until the $1,123.07 maximum is reached, so 26 equal pays would overshoot it; the last pay of the year takes less. BC, Newfoundland and Labrador and PEI were not compared this way because the CRA's calculator applies their prorated second-half rates.

Your TD1 forms change the tax

The tax on each pay depends on the claims on your federal and provincial TD1 forms. We use the basic personal amounts only (claim code 1). Payroll may also use claim code ranges rather than exact amounts.

Credits on your tax return are not in payroll

Credits and deductions you claim only on your return, such as Ontario's LIFT credit, provincial low-income tax reductions, medical expenses, donations, tuition and RRSP contributions you make yourself, are not applied by payroll unless the CRA has approved a request to reduce tax at source (form T1213).

Bonuses are taxed separately, and non-cash benefits generally attract CPP but not EI

Bonuses and retroactive pay are taxed with a separate bonus method. Vacation pay and taxable benefits are added to the pay they come with. Non-cash taxable benefits are generally pensionable but not insurable, so they attract CPP but not EI (CRA: Benefits and allowances chart).

RRSP contributions and union dues taken from pay lower the tax on each pay

RRSP, pension plan or pooled pension contributions your employer takes from pay lower the taxable income of each pay, so less tax is taken, but they do not reduce CPP or EI. Union dues taken from pay also lower taxable income. This calculator does not include either.

Ontario's health premium and surtax sit inside provincial tax

On an Ontario stub, the Ontario Health Premium and the surtax are normally part of the provincial tax line rather than shown separately, and the same goes for the Ontario and BC tax reductions.

Work out your own take-home pay.

These figures are estimates based on the 2026 federal, provincial and territorial tax rules, CPP and EI rates published by the Canada Revenue Agency and other government sources. They are general information, not tax, financial or legal advice. Your pay stub can differ, for example because of your TD1 claims, RRSP or pension deductions, union dues, taxable benefits, bonuses, how often you are paid or the point in the year. Check your pay stub, or ask your employer or the CRA, before relying on these figures.