Is the group RRSP match added to the employee's income?
Yes, as a taxable benefit in the year contributed. The employee's own RRSP deduction for the same amount generally offsets the inclusion.
Group Retirement · Match taxable benefit
Is an employer's group RRSP match a taxable benefit?
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Yes. The CRA treats every dollar an employer contributes to an employee's group RRSP as a taxable benefit to that employee, added to employment income in the year it is contributed (Canada Revenue Agency, Contributions to savings and pension plans, accessed August 25, 2026). In practice the employee's own RRSP deduction for the same amount generally offsets the inclusion, so the real payroll questions are narrower and more mechanical: which T4 boxes the benefit lands in, when you must withhold income tax on it and when you must not, and why CPP always applies while EI depends on a single plan-design detail, the withdrawal rule. This page walks the mechanics; the tax advantages case lives on its own page.
$68,900
2026 maximum insurable earnings ceiling for EI
1.63%
2026 employee EI premium rate
2.28 cents
employer EI cost per insurable dollar, at 1.4 times the employee rate
Box 24
the T4 box that appears only when in-service withdrawals are allowed
CPP
Always. The match is pensionable in both the cash and non-cash forms, up to the year's maximums.
EI
Only if in-service withdrawals are allowed. Lock withdrawals until retirement or departure and the match is a non-cash benefit with no EI.
Source: Canada Revenue Agency, Contributions to savings and pension plans (canada.ca, accessed August 25, 2026)
Who we build for
20 to 1,000+ people
Setup timeline
8 to 10 weeks
typical for a 20 to 200 person setup; larger plans take longer
What lands where on the T4
The reporting follows the benefit's form. The CRA splits it two ways:
Non-cash form (withdrawals locked until retirement or departure): Box 14 employment income, Box 26 CPP/QPP pensionable earnings, Code 40 in Other information.
Cash form (in-service withdrawals allowed): all of the above, plus Box 24 EI insurable earnings.
That one difference, Box 24 or no Box 24, is the whole EI story, and it is set by your plan design, not by payroll's choice at year end.
Withholding, done correctly
Income tax. Generally you withhold on a taxable benefit. The exception is the one most payroll teams miss, quoted from the CRA's page: "if you have reasonable grounds to believe the employee can deduct the contribution for the year, do not deduct income tax on the contributions you make to your employee's RRSP or FHSA." Reasonable grounds is not guesswork: the CRA states it generally considers you to have reasonable grounds when the employee has given you confirmation that the contribution can be deducted for the year. Collected once a year at enrolment or renewal, that employee confirmation means match dollars flow to the plan without a tax withholding haircut, and employees stop lending the government their refund for a year.
CPP. The match is pensionable in both forms. Box 26 carries it, and both employer and employee CPP contributions apply to it up to the year's maximums. There is no plan design that changes this.
EI. Only the cash form is insurable. If your plan allows employees to withdraw employer contributions while still employed, the match is a cash benefit, sits in Box 24, and carries EI premiums. If withdrawals are locked until retirement or departure, with the CRA's stated exceptions for the Home Buyers' Plan and Lifelong Learning Plan, the match is a non-cash benefit and EI does not apply.
The withdrawal rule, honestly sized
Locking in-service withdrawals removes EI from every match dollar, and it is worth knowing. It is rarely worth redesigning a plan for. The 2026 numbers from the CRA's premium table: the employee EI rate is 1.63 percent and the employer pays 1.4 times that, about 2.28 cents per insurable dollar, only up to the $68,900 maximum insurable earnings ceiling.
An employee earning at or above that ceiling hits the EI maximum on salary alone, so the match adds nothing either way; the difference is exactly zero for them. For a workforce mostly below the ceiling, an illustrative $60,000 annual match carried entirely as a cash benefit costs the employer up to about $1,369 a year in extra EI premiums, and usually less once capped employees are counted out. Every figure here is illustrative, and your payroll sets your number. Most employers who lock withdrawals do it for retention and for keeping retirement money retirement money; the EI treatment is a side benefit, not the reason. Confirm the treatment of your own payroll with your accountant.
The DPSP, in one line
Employer contributions to a deferred profit sharing plan are not a taxable benefit, carry no CPP or EI, and are not reported as income when contributed. That contrast, and when each structure fits, is the subject of the tax advantages page.
Your province may tax the match again
Federal treatment is only half the payroll answer. Three of the provinces we serve run payroll taxes with their own inclusion rules for employer RRSP contributions, each covered on its own page:
Ontario's Employer Health Tax: Ontario EHT and group RRSP matching. British Columbia's EHT and its notch band: BC EHT and group RRSP matching. Manitoba's Health and Post Secondary Education Tax Levy: Manitoba HE Levy and group RRSP matching.
Payroll questions employers ask
Do we withhold income tax on the match?
Not when you have reasonable grounds to believe the employee can deduct the contribution, per the CRA; an annual confirmation from the employee establishes that. Otherwise, yes.
Does CPP apply to the match?
Yes, always. The match is pensionable in both the cash and non-cash forms, up to the year's CPP maximums.
Does EI apply to the match?
Only if employees can withdraw employer contributions while still employed. Lock in-service withdrawals, with the CRA's Home Buyers' Plan and Lifelong Learning Plan exceptions, and the match is a non-cash benefit with no EI.
Which T4 boxes does the match go in?
Box 14 and Box 26 always, with Code 40 in Other information. Box 24 only when the benefit is in cash form because in-service withdrawals are allowed.
Is this different for a DPSP?
Yes, entirely: DPSP employer contributions are not a taxable benefit and carry no CPP or EI. The comparison lives on the tax advantages page.
Prepared by RiskX
Written by Jarod Smith, CEO, RiskX Insurance Brokers Inc. Reviewed by Gordon Smith, RiskX Insurance Brokers Inc.
Published: August 25, 2026. Updated: August 25, 2026.
Group retirement