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Provincial pension plans barely touch payroll in Canada, because only one province has its own: Quebec. If an employee’s province of employment is Quebec, you deduct QPP contributions instead of CPP. Everywhere else you deduct CPP. So the real question is how a Quebec payroll differs from the rest, and the answer is mostly rates and who you remit to.
Which provincial pension plan applies to which employee?
Province of employment decides it, not where the person lives. The CRA is plain about this: a Quebec worker gets QPP, and a worker anywhere else gets CPP, whatever their home address. Someone who lives in Ottawa and works in Gatineau is a Quebec payroll case. Flip it, living in Gatineau and working in Ottawa, and it’s CPP, even though they sleep in Quebec.
Both plans split the cost in half. The employee has their half deducted, and you pay the other half yourself. Both use the same $3,500 exemption and the same $74,600 ceiling in 2026, then a second tier up to $85,000. The CRA’s page on CPP contribution rates, maximums and exemptions shows the 5.95% rate and the $4,230.45 base maximum for 2026.
How do the 2026 rates compare?
| 2026 | CPP | QPP |
|---|---|---|
| Rate on pay from $3,500 to $74,600 (employee) | 5.95% | 6.3% (5.3% basic plus 1% additional) |
| Second tier, $74,600 to $85,000 | 4%, up to $416.00 | 4% |
| Top yearly amount, employee | $4,646.45 | $4,895 (Retraite Québec) |
| Who collects it | CRA | Revenu Québec |
The CPP maximum of $4,646.45 is the $4,230.45 base amount plus the $416.00 second tier. On the QPP side, the extra 0.35 points of rate is why the ceiling is about $249 higher.
What does the gap cost on a real payroll?
Our payroll deductions calculator and the employer maths behind it give these yearly amounts. Each figure is the employee half, and you match it.
| Salary | CPP (Ontario) | QPP (Quebec) | Difference |
|---|---|---|---|
| $40,000 | $2,171.75 | $2,299.50 | $127.75 |
| $60,000 | $3,361.75 | $3,559.50 | $197.75 |
| $75,000 | $4,246.45 | $4,495.30 | $248.85 |
| $85,000 and up | $4,646.45 | $4,895.30 | $248.85 |
On a $60,000 salary that’s $197.75 more for the employee and another $197.75 for you. For ten Quebec employees at that pay, the employer half alone is about $1,978 a year more than the CPP equivalent. It isn’t huge next to a payroll, though a small firm with a few Quebec hires will notice it in the budget once the year is added up and the employer halves stack.
Here’s how to read the table for one person. Take Marie, who earns $60,000 at a bakery in Sherbrooke. Her QPP is $3,559.50 for the year, which is about $137 per biweekly pay (26 pays), and the bakery matches that. An identical job in Sudbury would cost each side about $129 per pay in CPP. Small gap per cheque, bigger over a year.
Is the rest of a Quebec payroll different too?
Yes, and this is where the accounting changes. Quebec employers also handle the Quebec parental insurance plan (QPIP) premium and the health services fund contribution. Revenu Québec lists those, along with a labour standards contribution, as part of its employer source deductions. Quebec’s EI premium is lower because QPIP covers parental benefits: 1.30% in 2026, on up to $68,900 of earnings, or at most $895.70 a year.
The payroll remittance calculator shows the extra lines. A $5,000 monthly salary in Quebec comes to $1,593.30 a month to remit, against $1,449.27 in Ontario, with a QPIP line included. The gap isn’t all QPP. Quebec’s own income tax and QPIP are in there as well.
How should you record it in the books?
Keep the employee half and the employer half on separate lines. The employee half is money you withheld and owe on behalf of the worker. The employer half is a real payroll cost. Mix them and your payroll expense looks too small and your liabilities too big.
A Quebec employee’s QPP goes to Revenu Québec, not the CRA, and the QPP and CPP lines should never share an account. If you employ people in both places, run two sets of remittances. Watch for a worker who moves mid-year, since the province of employment can change and so can the plan.
Not sure how much a pension plan will pay your staff later? The CPP calculator gives a rough retirement figure for the federal plan. We don’t have a QPP benefit calculator, so use Retraite Québec for that.
What if an employee lives in one province and works in another?
Go back to where the work is done. The home address doesn’t matter for CPP or QPP, so a remote worker is the case to watch: if their employment is tied to your Quebec establishment, it’s QPP, and if it’s tied to an Ontario one, it’s CPP. When it isn’t obvious, ask the CRA or Revenu Québec before the first pay rather than correcting a full year later.
Where the numbers come from
CPP rates, exemption and ceilings are from the Canada Revenue Agency for 2026. QPP rates, the $74,600 and $85,000 ceilings and the $4,895 maximum come from Retraite Québec. The rule on province of employment is on a CRA payroll page. The salary comparison is our own calculation. We aren’t a government service and we don’t speak for one.
Frequently asked questions
Does any province besides Quebec have its own pension plan for payroll?
Not for payroll purposes. The CRA instructs employers to deduct QPP for Quebec employees and CPP for every other province and territory.
Do I deduct CPP or QPP for someone who lives in Ontario and works in Quebec?
QPP. The province of employment decides, not the home address.
What are the 2026 QPP rates?
Retraite Québec lists 5.3% for the basic plan and 1% for the additional plan on earnings above $3,500 up to $74,600, then 4% up to $85,000. Employer and employee each pay half.
Who do I remit QPP to?
Revenu Québec collects QPP contributions, not the CRA.
Does the employer pay more in Quebec?
On pension contributions, yes, by about $249 a year per employee at the top. Quebec also has QPIP and other employer contributions.
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