Hand putting Coins in glass jar with retro alarm clock for time to money saving for retirement

The maximum pensionable earnings under the Canada Pension Plan (CPP) will increase by 2.7% to $57,400 in 2019 from $55,900 in 2018, the Canada Revenue Agency (CRA) announced Thursday.

The CRA calculated the new ceiling according to a CPP legislated formula that takes into account the growth in average weekly wages and salaries in Canada. Contributors who earn more than $57,400 in 2019 are not permitted to make additional contributions to the CPP. The basic exemption amount for 2019 remains $3,500.

The employee and employer contribution rates for 2019 will be 5.1%, up from 4.95% in 2018, and the self-employed contribution rate will be 10.2%, up from 9.9% in 2018. The increase in contribution rates is due to the CPP enhancement, which will be implemented on Jan. 1, 2019.

The maximum employer and employee contribution to the plan for 2019 will be $2,748.90 each and the maximum self-employed contribution will be $5,497.80. The maximums in 2018 were $2,593.80 and $5,187.60, respectively.