Payroll Deductions Checklist for Self-Incorporated Canadians

Payroll deductions checklist for self-incorporated Canadians is a useful search because owner-managers often know they need to pay themselves salary, but are less sure what must happen before and after the bank transfer. If your corporation pays you T4 employment income, payroll is not just moving money from the business account to your personal account.

You need to calculate deductions, withhold them, add employer contributions, remit to CRA, and keep records that support your T4. Use this checklist each time you run payroll for yourself.

Payroll Deductions Checklist for Self-Incorporated Canadians

Before you pay yourself, confirm the basics:

• Your corporation has a CRA payroll program account, usually ending in RP0001
• You have chosen a pay frequency: monthly, semi-monthly, biweekly, or weekly
• You know the gross salary for the pay period
• You have the correct pay period start date, end date, and pay date
• You have current CPP, EI, and income tax rates for the year

If you have not opened the RP account yet, start with our guide on how to set up a CRA payroll account for your corporation. The account should be in place before regular salary payments begin.

1. Calculate Gross Salary First

Start with gross pay, not net pay. Gross pay is the employment income your corporation is paying you before deductions. This is the number that eventually flows into Box 14 of your T4.

For example, if you want to pay yourself $6,000 monthly salary, the $6,000 is gross pay. CPP, EI, and income tax are deducted from that amount to arrive at the net deposit to your personal account.

Avoid deciding on a random net transfer first and trying to back into payroll later. That is how owner-managers end up with messy records, missed remittances, or unclear shareholder loan balances.

2. Withhold Employee CPP, EI, and Income Tax

For each pay period, calculate:

• Employee CPP contribution based on pensionable earnings, the annual basic exemption, and annual maximums
• Employee EI premium based on insurable earnings, unless a specific EI exemption applies
• Income tax withheld based on annualized pay and applicable credits

The exact amounts depend on the pay frequency and current-year rates. Our CPP and EI deduction rates guide explains the 2026 CPP and EI mechanics in more detail.

A free tool like PaystubHero can calculate the deductions and create a clean Canadian paystub, so you are not rebuilding payroll math in a spreadsheet every month.

3. Add the Employer Portions

This is the step many first-time incorporated owners miss. The amount withheld from your paycheque is not the full CRA remittance.

Your corporation must also add:

• Employer CPP, generally equal to the employee CPP contribution
• Employer EI, generally 1.4 times the employee EI premium

These employer amounts are paid by the corporation. They reduce corporate cash, but they are not deducted from your net pay. Track them separately as employer payroll costs.

4. Pay Yourself the Net Amount

After deductions are calculated, transfer only the net pay to your personal account. Your paystub should show the bridge from gross to net:

• Gross salary
• CPP withheld
• EI withheld
• Income tax withheld
• Any other deductions
• Net pay deposited

This paystub becomes the source document for your accountant, your T4, and any lender or landlord asking for employment income proof. For format details, see what must be on a Canadian paystub.

5. Remit to CRA by the Deadline

For most one-person corporations, payroll deductions are due by the 15th day of the month after the month you paid salary. If you paid yourself on June 30, the regular remitter deadline is generally July 15.

Your remittance should include employee CPP, employer CPP, employee EI, employer EI, and income tax withheld. Save the CRA payment confirmation with the paystub for that period.

6. Reconcile at Year End

At year end, total your paystubs. The gross salary should support T4 Box 14. CPP, EI, and income tax withheld should support Boxes 16, 18, and 22. Your CRA remittances should reconcile to those employee deductions plus the employer portions.

Key Takeaway

A simple payroll routine keeps your corporation cleaner: calculate gross salary, withhold employee deductions, add employer CPP and EI, pay net salary, remit to CRA, and save the records. Do it the same way every pay period and your year-end T4 work becomes much easier.

Not tax advice — confirm your payroll setup with your accountant if your situation is unusual.