Quick answer: A Pensionable and Insurable Earnings Review (PIER) report means the CRA recalculated the CPP contributions and EI premiums your T4 slips imply, and got a different number than the slips show. The report lists each affected employee and the difference. Sometimes the difference is real; often it is explained by something the automated check cannot see, and the response is an explanation rather than a payment.
Why PIER reports happen to careful employers
The check behind a PIER report is arithmetic: earnings on the T4, times the year’s rates, compared against the deductions reported. The commonest legitimate explanations are an employee who turned 18 or 70 during the year, an employee who reached the year’s maximum with a previous employer, mid-year hires whose exemption prorates, and CPP2’s second band interacting with a mid-year start. The current-year figures the check runs on are set out on our payroll figures page.
Work the report before you pay it
- Take each named employee and reconstruct their year: start date, birth date if near 18 or 70, prior-employer earnings if any, and what was actually withheld.
- Where the report is right, a real under-deduction — the employer generally owes both halves of the shortfall, and can then recover the employee half from the employee within the rules.
- Where an explanation applies, respond with it, per employee, by the report’s stated date. An explained line is closed, not paid.
Stop it recurring
A PIER report that repeats every year is a payroll-setup problem, not bad luck — usually a system not handling the basic exemption, proration, or CPP2 correctly. Fixing the configuration once is cheaper than reconciling every February. Our remittance calculator and payroll hub cover the mechanics, and moving payroll to us removes the problem entirely.
A PIER report is the CRA reconciling your remittances for you, and it stops arriving once ongoing payroll compliance is doing the same check monthly.
General information, not tax advice. A letter’s own wording and dates govern — confirm anything that affects a decision on a free consult.
Common questions about PIER report
Do I have to pay the amount on the PIER report?+
Can I recover an under-deduction from my employee?+
Why does this keep happening every year?+
Does a PIER report affect my employees’ benefits?+
Other CRA letters, decoded
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