The Canada Pension Plan (CPP) is a mandatory public pension funded by payroll deductions. Your employer withholds it from each paycheque as a statutory deduction, listed with income tax and EI, to help fund retirement, disability, and survivor benefits.

If you work in Quebec, the same kind of deduction is called the Quebec Pension Plan (QPP). A Quebec pay stub shows QPP where other provinces show CPP.

At year-end those amounts appear as a yearly total on your T4 slip, which you use to file your return. The contributions help fund retirement, disability, and survivor benefits. It is a required deduction, not an optional savings plan like an RRSP.

Click Here for our lesson on How Canadian Taxes Impact Your Personal Finances