My husband's T4 includes contribution for CPP2 , but the CPP earnings reflects YMPE, not YAMPE. CPP2 contribution reflect as overpayment, and refunds. How do I fix?

Forum|Forum|1 year ago
March 20, 2025
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I've connected with his employer, and she will not change the T4, based on instructions from CRA and within her software that Box 26 is earnings base for contributions in box 16, not box 16a. Conversely, my employer included YAMPE in box 26, reflecting the earnings base for both box 16 and 16a. If I change box 26 to reflect YAMPE, I'm concerned CRA will just adjust based on T4 that was filed. I also don't seem to have any option to adjust earnings in Schedule 8.

TurboTaxAniqua

Box 26 on your Canadian T4 slip refers to the "CPP/QPP Pensionable Earnings" amount. This box is used to report the amount of your earnings that is subject to Canada Pension Plan (CPP) or Quebec Pension Plan (QPP) contributions. It's important to understand that there is a maximum limit to how much of your earnings can be subject to CPP/QPP contributions in a given year. This limit is known as the Year's Maximum Pensionable Earnings (YMPE).

If your earnings exceed the YMPE, then the amount in Box 26 will not match your total earnings for the year. Instead, it will match the YMPE for that particular year, since that's the maximum amount of earnings on which you're required to contribute to CPP/QPP.

To be certain, you would need to compare the figure with the official YMPE for the year you're filing for. The Canada Revenue Agency (CRA) website provides the YMPE for each year. Canada Revenue Agency announces maximum pensionable earnings and contributions for 2024

If your employer is not willing to change/correct the T4, you can add the corrected information and choose Print to Mail to CRA.

Thank you for choosing TurboTax.

ctlyfAuthor

Thank you for the response. I am aware that there is a maximum to pensionable earnings (YMPE - $68,500 for 2024) and that the amount in Box 26 will not equal the amount in Box 14, if total earnings are higher than YMPE. In 2024, there was an additional contribution (known as CPP2) which is based on a second earnings ceiling (YAMPE - $73,200 for 2024). We both earned more than the YAMPE, so have maxed out on CPP contributions for 2024.

My issue is that my husband's T4 is reporting CPP earnings of only the YMPE of $68,500. As such, TurboTax is calculating the CPP2 contribution as an overpayment and refunding it, even though his employment income is clearly more than the YAMPE. Conversely, my T4 is reporting CPP earnings of $73,200, which is the second earnings ceiling, or YAMPE, and TurboTax is correctly calculating that my CPP2 contribution should not be refunded.

My husband's employer is not going to amend the T4, saying CRA guidance (https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/tax-slips/understand-your-tax-slips/t4-slips/t4-statement-remuneration-paid.html) is that the amount in box 26 is related to contributions in box 16, saying nothing about earnings related to box 16a. If I change the amount in his box 26 to reflect YAMPE, TurboTax will properly calculate his tax refund, but I am concerned that CRA may adjust the amount in box 26 on assessment to reflect what has been filed. Has TurboTax been made aware of this issue, and has CRA provided any guidance when the T4 has been filed incorrectly (as their guidance is not clear)?