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July 1st 2025 Tax Bracket Revision Process Guide

Required K212 HRP Setup for Statutory Deductions Rates effective for July 1, 2025

For: All Boards/Districts

Last Updated: 6/11/2025

This document is provided to assist boards/districts with updating Statutory Deduction values in K212 HRP. Please note that while these figures have been validated on the various sources’ websites, boards are responsible for ensuring these values are correct and they are responsible for maintaining this information throughout the year, if there are any changes. These values should be updated prior to running the first pay of the New year.

IMPORTANT NOTE: For the purpose of this document, jurisdictional information (provincial) in screenshots such as Tax Brackets & Provincial Personal amount/Indexing Factor are in Ontario figures. 

FEDERAL TAX DATA Module

The screen below shows the new tax rates and figures for the Year 2025.

PAYROLL > BOARD > FEDERAL TAX DATA

Find > Current 2025 Tax Record > Input End Date = 2025/06/30 

**Once complete choose Save to close the current record**

IMPORTANT NOTE: It is likely safer to use July 1st as opposed to the First Day of the First Pay Period. This is because multiple different Employee Groups will have multiple different Start Dates so July 1st is the most accurate way to report this, as there will be some variance in any event. 

Provincial Tax Credit Information

Note: Please see the bottom of the document to reference Table 8.2 in CRA T4127-25e

Canada Employment Credit (CEA) = 1,471

DUPLICATE & UPDATE START DATE

Right Click > Duplicate the closed June 2025 record to create a new record with Start Date = 2025/07/01

**Fill in the required data as shown**

Ensure Lowest Bracket Tax Rate = 14.5%

IMPORTANT NOTE: Since HRP utilizes Tax Option 2, rates will not be prorated. As this is the case, 14.5% will need to be reflected within the system as this is now intended to be the full year tax rate for 2025. 

14% is to be used for Taxation Option 1 only, as this will prorate alongside the 15% to yield the desired 14.5%.  (Both with 50% weightings of the year)

IMPORTANT NOTE 2: For 2026 and onwards, it becomes 14% for the full calendar year. 

Note: Federal and Provincial Indexing Factor fields must be completed only when automated indexing is chosen. 

Leave Federal & Provincial Indexing Factor fields blank when automated indexing is not to be used. For accurate calculations, please enter the proper factor value (Example: 2.4% = 1.024 – Index at 102.4% of the previous year’s credits)

CPP, EIC, WSIB, EHT Module

The screen below shows the CPP and EIC Rates for the Year 2025.

IMPORTANT NOTE: There is no change required for this module. Screenshots for this module simply confirms the current setup. 

PAYROLL > BOARD > CPP, EIC, WSIB, EHT

Current record with Start Date = 2025/01/01

**Fill in the required data as shown**

NOTE: YAMPE = $81,200 and CPP Employee Rate 2 = 4%

WSIB (WCB): Only complete if required. Check your Province's rates. 

PENSION DEDUCTION Module

The screen below shows the new Pension rates for Year 2025. 

IMPORTANT NOTE: There is no change required for this module. Screenshots for this module simply confirms the current setup. 

PAYROLL > BOARD > PENSION DEDUCTIONS

Current record with Start Date = 2025/01/01

**Fill in the required data as shown**

Note: Values that may be updated from the previous year are Employee 1%, Employee 2% and Annual Maximum Pensionable Earnings fields. 

• Employer %1 & Employer %2 is only required if the Employer Share is different from the Employee Share
• The other fields may be board/district specific (Example: Liability/Expense Account GL)

IMPORTANT NOTE: Employee %1 and Employee % 2 is only "reversed" for TSC. 

OMERS, MPP, etc need to be Employee %1 = Lower Rate, and Employee %2 = Higher Rate.  

CREATE STATUTORY DEDUCTIONS Module

IMPORTANT NOTE: It is not required to run this process as none of the below figured have been updated for the July 1st, 2025 revision. 

PAYROLL > YEAR END > CREATE STATUTORY DEDUCTIONS

**Once complete choose Submit to process the automated job**

Note: The standard TD1 and Provincial TD1 amounts will be automatically populated from the Federal Tax Data module after clicking TAB following the date entry. 

Tax Bracket Data by Province

Additional Notes & Resources

T4127-25e (HTML): Payroll Deductions Formulas - 121st Edition Effective July 1, 2025 - Canada.ca 

T4127-25e (PDF): T4127(E), Payroll Deductions Formulas 

CPP Contribution Rates, Maximums and Exemptions: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-deductions-contributions/canada-pension-plan-cpp/cpp-contribution-rates-maximums-exemptions.html 

CPP2 Contribution Rates and Maximums: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/calculating-deductions/making-deductions/second-additional-cpp-contribution-rates-maximums.html 

EI Premium Rates & Maximums: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-deductions-contributions/employment-insurance-ei/ei-premium-rates-maximums.html 

WSIB Premiums and Rates: https://www.wsib.ca/en/2024premiumrates#:~:text=The%20maximum%20insurable%20earnings%20ceiling,Workplace%20Safety%20and%20Insurance%20Act. 

PA Max Accrued: https://www.canada.ca/en/revenue-agency/services/tax/registered-plans-administrators/pspa/mp-rrsp-dpsp-tfsa-limits-ympe.html 

T4127-25e Table 8.1: