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  3. ›Taxation and Employee Deductions Learning Module
  4. ›Federal Payroll Accounts (continued)

Federal Payroll Accounts (continued)

Calculating Deductions and Contributions

You will calculate the deductions based on the amounts you pay your employees. Deductions are taken for income tax, Canada Pension Plan (CPP) contributions, and Employment Insurance (EI) premiums.
 
In addition to the deductions taken from an employee's remuneration, you will also have to calculate and set aside your share of CPP and EI. There is no employer contribution required for income tax.
 
You must hold all of the amounts deducted from your employees' remuneration, plus your employer contribution to CPP and EI, in trust for the Receiver General until it is time to remit these sums.