Pensionable and Insurable Earnings Review: Canadian Employers—Pay or Correct?

After receiving a CRA Pensionable and Insurable Earnings Review (PIER) notice, reconcile the listed employees’ T4 pensionable and insurable earnings and CPP/EI amounts against payroll history, CRA calculations and remittance records for the reporting year.[1][2][5] The CRA’s annual review compares required CPP and EI amounts calculated from employees’ earnings with amounts reported on their T4 slips.[1]

If you agree and pay the exact PIER amount by the deadline, no reply is required. If you disagree, return corrected information and an explanation by the stated reply date.[1]

Identify the reporting year and affected employees

• Reporting year: Confirm the pay year in question and retrieve that year’s payroll history.[5]
• Employees and calculation inputs: Identify each employee and the amounts on the PIER listing. Employee numbers may appear if supplied on electronically filed T4s.[1]
• Balance and deadline: Record the summary balance and printed reply date. The package also includes a remittance voucher.[1]

Check the notice type: Payworks distinguishes PIER’s employee-level review from a PD4R discrepancy notice, which compares total remittances with T4/T4A filing totals.[2]

Separate reporting corrections from genuine shortfalls

For each listed employee, compare the CRA calculation inputs with filed T4 information and reporting-year payroll records. Check pensionable earnings, insurable earnings, and CPP and EI amounts, keeping these supporting records alongside the comparison:[1][2][5]

• Reporting and payroll: T4 Summary, payroll registers, audit-trail reports, and adjustments to pensionable or insurable earnings and benefits.[2]
• Employee details: Birthdates and exemption declarations relevant to the calculation.[2]
• Payment evidence: Remittances made outside payroll.[2]

For employers with multiple payroll program account extensions, the CRA compares all T4 information returns under the business number.[1]

Check what caused each difference

• Employee settings: Compare birthdates, exemption declarations and classifications with supporting records, including changes during the year.[2][3][6]
• Payroll transactions: Check manual and off-cycle calculations, extra regular pay runs, taxable benefits with missing source remittances, and payments outside payroll.[2][3][6]

If you also received a PD4R discrepancy notice: keep reported contributions separate from money remitted. Check for employees moved between payroll deduction accounts without corresponding CRA remittance transfers, check year-to-date data imported or adjusted after those moves, and review the CRA Statement of Account for an unused prior-year credit.[2]

Québec employers: for QPP and QPIP, Revenu Québec may issue its own deficiency or discrepancy notice following RL-1 filings.[2]

Illustrative reconciliation

Fictional example—not a contribution calculation.

• Employee A: Payroll history and supporting records establish that the T4 earnings information used in the review is incorrect. If you disagree, this calls for corrected information and an explanation, rather than automatic acceptance of the listed amount.[1]
• Employee B: Earnings and reported amounts match payroll records, but checking the CRA calculation confirms a deficiency. This is a valid amount payable.[1]

A file can need both a correction response and a payment: the CRA’s process allows payment of a remaining deficiency after a response.[1]

Respond by the notice’s reply date

• Agree: Pay the exact PIER amount by the deadline; no reply is required.[1]
• Disagree: Return corrected information and an explanation by the stated reply date.[1]

Submit a disagreement response through My Business Account or Represent a Client, mail it to the return address on the notice, or fax it to the applicable National Verification and Collection Centre.[1] Organise the explanation by employee, disputed input, corrected information and supporting calculation.[2][3]

The My Business Account PIER Overview permits payment of the full deficiency without a reply, or a remaining deficiency after a response. This payment option is unavailable through Represent a Client.[1]

Do not send amended T4 slips. The CRA issues them when adjustments are needed.[1] Requesting changes to previously filed T4s does not pause the deadline: failure to reply or pay in full by the printed reply date results in an assessment with applicable penalties, interest, or both.[1]

Keep the response and follow-up record

Keep the notice, reconciliation, supporting records, explanation, submitted response, payment evidence and resulting amended slips together.[1][2][3] When adjustments are necessary, the CRA sends two amended-T4 copies: retain one and give the other to the employee.[1]

After resolution, review the cause, any prior-year pattern and process changes that could prevent a repeat.[3]