CPP and EI deductions change throughout the year because these programs have annual contribution limits. Once you reach the yearly maximum, your deductions stop, which changes how much you take home on each paycheque. Explore more about gross pay deduction on the Alberta guide.

How hours worked affect CPP and EI

The more hours you work in a pay period, the higher your gross pay — and the more CPP and EI get deducted. Since both deductions are calculated as a percentage of your earnings, bigger pay periods naturally lead to higher contributions.

What happens when you reach the annual maximum

Once your CPP and EI contributions reach the yearly maximum, the deductions stop for the rest of the year. This pause increases your take‑home pay because less money is being taken off each paycheque. The contributions then reset at the beginning of the next calendar year. This is explained by why salary is lower in January.

How overtime impacts CPP and EI contributions

Overtime increases your total earnings for the pay period, and CPP and EI are calculated as a percentage of those earnings. When you work overtime, your gross pay goes up, so your CPP and EI deductions rise as well. This can make overtime paychecks feel smaller than expected because a larger portion is going toward CPP contributions and EI premiums.

Overtime can also push you toward the annual maximums faster. Once those limits are reached, the deductions stop, and your take‑home pay increases for the rest of the year.

Estimate your take‑home pay using the calculator.