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A self-employed person pays both halves of the CPP. For 2027 the CRA lists a maximum of $8,418.00 for CPP and $856 for CPP2. Our own sum gives $9,274.00 at most, reached with net income of $87,400 or more. The effective CPP rate is 11.5%, twice the 5.75% employee rate.
How much CPP does a self employed person pay in 2027?
A sole proprietor or partner who is not an employee pays both the employee half and the employer half of CPP. The CRA lists the 2027 maximum self-employed CPP contribution as $8,418.00. The CPP2 maximum for a self-employed person is $856. Added together, the most anyone can owe for 2027 is $9,274.00, which is our own sum of the two CRA figures.
These maximums apply to net business income, meaning revenue minus allowed expenses, not to gross sales. A person with a low profit pays much less than the maximum. The amount is calculated on the return and added to the income tax bill, so there is no separate payment form.
What is the 2027 CPP contribution rate and maximum pensionable earnings?
For employees and employers the CRA shows a 2027 CPP rate of 5.75% on earnings between $3,500 and $76,700. The CRA page does not print a separate self-employed rate. Because you carry both halves, the effective rate is twice the employee rate. That is 11.50%, our own arithmetic, and it matches the CRA maximum: $73,200 times 11.5% is $8,418.00.
CPP2 works the same way above the first ceiling. Earnings between $76,700 and $87,400 are charged 4% to the employee and 4% to the employer, so a self-employed person pays 8% on that band. The maximum is $10,700 times 8%, which is $856.
How does 2027 compare with 2026?
| Item | 2026 | 2027 |
|---|---|---|
| CPP rate, employee or employer | 5.95% | 5.75% |
| CPP maximum, self-employed | $8,460.90 | $8,418.00 |
| CPP2 maximum, self-employed | $832 | $856 |
| Combined maximum (our sum) | $9,292.90 | $9,274.00 |
| Net income at the CPP ceiling | $74,600 | $76,700 |
| Net income at the CPP2 ceiling | $85,000 | $87,400 |
The combined maximum is $18.90 lower in 2027 than in 2026, because the lower CPP rate outweighs the higher ceilings and the larger CPP2 band. The 2026 figures are on the same CRA pages. The comparison is our subtraction.
What would different profits cost in CPP?
These examples apply the 2027 rules to a full year of net business income. They are labelled examples and do not include income tax, EI (self-employed people only pay it if they have opted in) or provincial plans.
| Net business income | CPP | CPP2 | Total (our sum) |
|---|---|---|---|
| $20,000 | $1,897.50 | $0.00 | $1,897.50 |
| $45,000 | $4,772.50 | $0.00 | $4,772.50 |
| $76,700 | $8,418.00 | $0.00 | $8,418.00 |
| $80,000 | $8,418.00 | $264.00 | $8,682.00 |
| $100,000 | $8,418.00 | $856.00 | $9,274.00 |
The first $3,500 of net income is exempt from CPP. Below that, nothing is charged. Above $76,700 the CPP part stops growing and CPP2 starts. At $87,400 and more, you reach the $9,274.00 ceiling. Use the self-employed tax and CPP calculator to see how this adds to income tax.
How and when are these contributions paid?
CPP on self-employment income is calculated on your personal return and added to your balance owing. You do not remit it by itself. Most self-employed people have a filing deadline of June 15, but a balance owing is still due by April 30, so interest can start earlier than many people expect. For the 2026 return the deadlines stay as they are, and the proposed May 15 date starts from the 2027 tax year. Our tax calendar for 2027 lists the dates, and the page on self employed tax returns explains the records to keep.
If your income is steady, you may be asked to pay quarterly instalments that include CPP. Missing them can lead to interest, so look at your notice of assessment.
Is the CPP you pay on business profit deductible?
The two halves are treated differently on the return. Part of the contribution is claimed as a deduction and part as a non-refundable credit, and the return uses a CRA schedule to work out the split. We do not give the exact mechanics here because the CRA explains them in its guide for self-employed people, and the details depend on your return. What matters for planning is that your cash cost is the full amount in the table, but your tax saving is smaller than the contribution itself.
The same schedule also picks up CPP2. If you plan to estimate the whole bill, use a calculator that includes both, such as the self-employed tax and CPP calculator, and keep in mind that 2027 income tax brackets are not published yet.
How much should you set aside from each payment?
Nothing is withheld from business income, so the bill arrives all at once. A simple method is to move a share of every client payment into a separate account. For CPP alone, 11.5% of net income above $3,500 gives a good idea until you reach the maximum. Income tax is on top of that, and it grows with profit. Some people also set aside GST or HST they collect, which is not their income at all. Do not mix the two accounts.
When profit is lumpy, look at your notice of assessment for the prior year and for any instalment reminders. The Canadian tax numbers for 2026 and 2027 page keeps the key limits in one place. This is general information, not personal advice.
What records should you keep?
The CPP bill depends on one number, your net business income, so the records that support it matter. Keep sales invoices or deposit records, receipts for every expense you claim, and a log of any vehicle or home office use. Keep them for six years from the end of the tax year, which is the period the CRA tells people to hold records. If your income comes from a mix of sources, such as a salary, a few clients and some rental income, keep each source separate, because only self-employment income is charged the self-employed CPP.
A simple monthly habit helps. At the end of each month, total the income and expenses, check the result against your bank statement and note what you set aside for tax. It takes about twenty minutes and removes the worst surprises at filing time. Our guide on self-employed expenses you can deduct lists the common categories.
Remember that a lower net income through legitimate expenses also lowers the CPP you pay, though it also lowers the pension you build. Contributions count towards your future CPP retirement pension, so the cost buys something. The CPP retirement pension guide explains how the start age changes the amount.
What about Quebec and employees with side income?
Self-employed people in Quebec pay into the QPP, not the CPP, and the 2027 QPP figures are not confirmed on an official page we could open, so we do not state them. See QPP and QPIP for 2027 for what is known.
If you have both a job and a side business, your employer's CPP counts towards the same ceilings. The return works out the total, and the self-employed part only applies up to what is left of the maximum. Keep your T4 slips and your business records together so the amount is right.
What mistakes do people make?
- Using gross sales instead of net income to guess the CPP bill.
- Forgetting that both halves are yours, so the number is twice what an employee sees on a stub.
- Not setting money aside, since nothing is withheld during the year.
- Assuming the 2026 amounts apply in 2027. Both the rate and the ceilings are new.
- Ignoring the second ceiling, which adds CPP2 once net income passes $76,700.
For a wider view of the taxes involved, read Self-employed tax in Canada: what you owe and when and how income tax for self-employed people works. This page is information only and not tax advice.
Frequently asked questions
What is the maximum self employed CPP for 2027?
The CRA lists $8,418.00 for CPP and $856 for CPP2 for a self-employed person in 2027. Our own addition gives a combined maximum of $9,274.00 for someone with net business income at or above $87,400. Lower profits pay less, and nothing is charged below $3,500.
Why does a self employed person pay twice the rate?
An employee pays half and the employer pays half. A self-employed person is both, so they pay both halves. That is 11.5% for CPP in 2027, twice the 5.75% employee rate, on net income between $3,500 and $76,700. The 11.5% figure is our own arithmetic.
Is the self employed CPP lower in 2027?
Slightly. The combined maximum is $18.90 lower than in 2026, from $9,292.90 to $9,274.00. The CPP rate falls from 5.95% to 5.75% while the ceilings go up, which almost cancels out. The comparison is our own arithmetic from the CRA figures for both years.
When do I pay CPP on self employment income?
It is calculated on your return and added to the tax you owe. A balance is due by April 30, even if your filing deadline is June 15, so interest can start before you file. Instalments may apply if you owe a large amount each year. Check your notice of assessment.
Do I pay CPP if my net income is below $3,500?
No. The CRA basic exemption is $3,500, so CPP applies only to net self-employment income above that amount. CPP2 applies only to net income above $76,700, up to $87,400. If you have a job as well, your employer CPP counts towards the same ceilings.
What do Quebec self employed people pay?
They pay into the Quebec Pension Plan rather than the CPP. We could not confirm the 2027 QPP rate and ceilings on an official page, so we do not state them. Check Revenu Quebec and Retraite Quebec before you file or plan your savings.