Employee Who Reports to Work at One of Your Establishments Subject to the Canada Pension Plan (CPP) and at One of Your Establishments Subject to the Québec Pension Plan (QPP)

Québec Pension Plan contributions

If, during the year, an employee reports for work at one of your establishments subject to the Canada Pension Plan (CPP) and at one of your establishments subject to the Québec Pension Plan (QPP), you must take into account:

  • the contribution rate applicable to the establishment where the employee reports for work; or
  • the contribution rate applicable to the establishment from which the employee is paid, if the employee is not required to report for work at any of your establishments.

You must remit the amount withheld to the appropriate plan.

Employee who is transferred

Where an employee is transferred during a pay period, the employee is considered to have worked during the entire pay period at the establishment to which he or she was transferred, and you must remit to the new plan the full amount withheld from the employee's salary or wages for the pay period.

Where an employee is transferred from an establishment subject to the CPP to an establishment subject to the QPP, you must multiply the total CPP contributions withheld since the beginning of the year by a weighting factor to determine the maximum employee QPP contribution to withhold. To obtain the factor, divide the QPP contribution rate for the year by the CPP contribution rate for the year.

Note

The QPP contribution to withhold for a pay period must not exceed the maximum contributory earnings for the year, multiplied by the QPP contribution rate minus QPP and CPP contributions withheld since the beginning of the year.

Example of how to calculate the contribution based on the employee's situation during the year

An employer with one establishment in Québec and another in Ontario pays employees every Friday. The employer transfers one employee from one establishment to the other twice during the year. The employee earns $1,500 per week. The basic exemption is $67.30 per week.

Calculation of contributions based on the employee's situation Pensionable salary or wages Contribution Accumulated contributions
CPP QPP CPP QPP
During the first 20 weeks of the year, the employee works at the establishment in Québec.
  • Pensionable salary or wages for purposes of the QPP for 20 weeks: $1,500 × 20 weeks = $30,000
$30,000
  • QPP contributions for 20 weeks: ($1,500 − $67.30) × 5.40% × 20 weeks = $1,547.40
$1,547.40 $1,547.40
At the beginning of the 21st week, the employee is transferred to the establishment in Ontario, where he works until the middle of the 30th week.
  • Pensionable salary or wages for purposes of the CPP for 9 weeks: $1,500 × 9 weeks = $13,500
$13,500
  • CPP contributions for 9 weeks: ($1,500 − $67.30) × 4.95% × 9 weeks = $638.28
$638.28
  • CPP contributions to add to the accumulated contributions: $638.28 × (5.40 ÷ 4.95)1 = $696.31
+ $696.31
During the 30th week, the employee is recalled to the establishment in Québec, where the employee works for the remainder of the year.
  • Pensionable salary or wages for purposes of the QPP for 7 weeks : $1,500 × 7 weeks = $10,500
+ $10,500
  • QPP contributions for 7 weeks: ($1,500 − $67.30) × 5.40% × 7 weeks = $541.59
+ $541.59 + $541.59
Subtotal = $13,500 = $40,500 = $638.28 = $2,088.89 = $2,785.30
QPP contribution for the 37th week
  • Pensionable salary or wages for the purposes of the QPP (maximum pensionable salary or wages for the purposes of the QPP for the year minus the total of the pensionable salary or wages for the purposes of the QPP and the CPP since the beginning of the year) $55,300 − $40, 500 − $13,500 = $1,300
+ $1,300
  • QPP contribution (maximum QPP contribution for the year minus the contributions accumulated since the beginning of the year ($2,797.20 − $2,785.30) = $11.90.
+ $11.90 + $11.90
  • QPP contributions for the remaining 15 weeks
+ $0 + $0
Total2 = $13,500 = $41,800 = $638.28 = $2,100.89 = $2,797.20
  1. This is the ratio between the QPP contribution rate (5.40%) for the year and the CPP contribution rate (4.95%) for the year that must be applied to the total CPP contributions withheld since the beginning of the year.
  2. On the employee's RL-1 slip, the employer must enter $2,100.89 in box B and $41,800 in box G. The employer must also enter G-2 in a blank box, followed by $13,500, and B-1 in another blank box, followed by $638.28. The total amount of pensionable salary or wages for purposes of both plans must not exceed the maximum pensionable salary or wages for purposes of the QPP for the year ($55,300).
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