Canadians will pay less into the Canada Pension Plan from January 1, 2027, and the change is already law. Bill C-30, the Spring Economic Update 2026 Implementation Act, received Royal Assent on June 19, according to Finance Canada. It lowers the base CPP contribution rate from 9.9% to 9.5%, and it extends the Home Buyers' Plan repayment grace period for RRSP withdrawals.
Finance Minister François-Philippe Champagne tables the federal budget on November 5, and the days before it will fill with speculation. Neither measure depends on that document. A later bill would be needed to change either one.
What the CPP Rate Cut Changes and What It Leaves Alone
The base contribution rate falls from 4.95% to 4.75% for employees and for employers, Benefits and Pensions Monitor reported on October 5, citing the Office of the Superintendent of Financial Institutions. The combined base rate moves from 9.9% to 9.5%. The additional CPP introduced in 2019 is unchanged, and Manulife notes that benefit amounts do not change.
Finance Canada estimates the saving at about $133 a year for an employee earning $70,000, with the employer saving the same amount. The arithmetic is 0.2 percentage points applied to earnings between the $3,500 basic exemption and the maximum pensionable earnings for the year, which Advisor.ca reports as $74,600 for 2026. At that ceiling the saving reaches $142.20 for an employee and for an employer. The 2027 ceiling will differ, so the exact maximum will move.
Self-employed workers pay both shares, so their saving doubles: about $266 at $70,000 of earnings and $284.40 at the 2026 ceiling. Those two figures are HDQ calculations from the published rates.
The saving climbs by $10 for every $5,000 of earnings up to the $74,600 ceiling and then stops rising, and a self-employed worker keeps exactly twice what an employee does at every level.
The employee and employer saving equals 0.2 percentage points of earnings between the $3,500 basic exemption and the earnings ceiling, which is $74,600 for 2026 and will change for 2027. The self-employed line doubles the employee figure because self-employed workers pay both shares. Finance Canada estimates $133 at $70,000; every other point is an HDQ calculation.
Where the Freed Cash Goes, by Client Type
The saving is small per paycheque and large in aggregate. Benefits and Pensions Monitor reported that total contributions across about 16 million contributors are expected to fall by more than $3 billion a year. For one employee earning $70,000, the saving is roughly $11 a month before tax.
Account choice decides whether the money compounds. The 2026 TFSA limit is $7,000 and the 2026 FHSA annual limit is $8,000, so $133 fills about 1.9% of a TFSA year or 1.7% of an FHSA year. The RRSP dollar limit is $33,810 for 2026, with a March 1, 2027 deadline for a 2026 deduction, according to iA Financial Group.
The after-tax gain is smaller than the headline figure. Under the Income Tax Act the base portion of CPP contributions earns a non-refundable credit while the enhanced portion earns a deduction, so a lower base contribution also means a slightly smaller credit.
Incorporated owners who pay themselves salary at or above the ceiling save $142.20 as employee and $142.20 as employer, or $284.40 per owner, an HDQ calculation. Wellington-Altus noted that incorporated owners may see a modest effect on their salary-versus-dividend analysis from 2027. Retirees drawing CPP see no change in benefits.
The Home Buyers' Plan Window Closes December 31, 2028
The Home Buyers' Plan lets a first-time buyer withdraw up to $60,000 from an RRSP, or $120,000 for a couple, and repay over 15 years, according to Fidelity. Repayment normally starts in the second year after the year of the first withdrawal. For first withdrawals made from 2022 through 2028, the start moves to the fifth year, so a 2026 withdrawal means a first repayment year of 2031 where the old rule would have set 2028.
Wellington-Altus estimated the relief at up to $4,000 per individual in each of the three extra years. That figure is the $60,000 maximum divided across the 15-year repayment period.
Two timing rules matter. The first withdrawal must be made by December 31, 2028 to qualify for the extended start. Funds also need to be in the RRSP for at least 90 days before withdrawal, Fidelity says, so money added after about October 2 would not meet that test for a withdrawal by December 31, 2026. That date is an HDQ calculation.
The plan can be combined with FHSA savings for the same purchase, Fidelity notes, and an FHSA contribution made by December 31, 2026 is deductible on the 2026 return, according to iA Financial Group.
What November 5 Can and Cannot Reach
The fiscal backdrop is tighter than it was in April. Parliamentary Budget Officer Annette Ryan estimates that new spending commitments have used up the gains from higher oil prices and that deficits are about $3 billion a year deeper than her office projected in June, The Hub reported on October 21. The same report put the 2030-31 deficit above $63 billion, against an April projection of $53 billion.
CP24 reported that a KPMG survey found more than 70% of respondents expect business-friendly measures in the budget. Neither CP24 nor The Hub reported a specific personal tax measure when the budget date was announced on October 20.
The settled list is short and dated. The CPP rate cut starts January 1, 2027. The Home Buyers' Plan extension covers first withdrawals through December 31, 2028. The Labour Mobility Deduction maximum rises from $4,000 to $10,000, with the distance threshold falling from 150 kilometres to 120. The $10 million capital gains exemption for employee ownership trust and worker co-operative transfers becomes permanent. Everything else waits for the budget document.
The planning conversation these measures support is short: where the 2027 payroll saving is directed, whether a first-home timeline fits inside the 2028 window, and what, if anything, the budget adds. The dates to hold are December 31, 2026 for FHSA contributions, January 1, 2027 for the CPP change, and December 31, 2028 for the Home Buyers' Plan.