PIER report

What the CRA compares, and why

Each year the CRA checks that the CPP and EI deducted and reported on your T4 slips agree with the amounts required by each employee’s pensionable and insurable earnings. The review matters because those amounts feed the employee’s future CPP and EI benefits.

Common triggers include box 28 (exempt from CPP, EI or PPIP) completed incorrectly, an employee turning 18 or 70 without the deductions changing, a wrong name or social insurance number on the slip, and an extra payment that let the pay-period CPP exemption apply more than once.

What arrives and the timeline

The package includes a listing of affected employees with the amounts the CRA used, a PIER summary showing any balance due, and a remittance voucher. It arrives by mail, and also in My Business Account or Represent a Client if you are registered, where PIER information is kept for the last five years.

The initial letter asks for a reply within 30 calendar days. If you neither reply nor pay in full, a notice of assessment is issued around day 45, with penalties or interest or both, and the CRA issues amended T4s around day 65.

How to respond

You do not have to reply if you agree with the CRA’s calculations and will pay the exact amount shown by the deadline. If you disagree, return the PIER with the corrected information and an explanation, online or by mail or fax to the number on the letter.

Do not send amended T4 slips in response. If adjustments are needed, the CRA prepares two copies of each amended slip, one for your records and one for the employee. This review differs from a discrepancy notice (PD4R), which deals with mismatches between remittances and returns.

An illustrative example

Suppose an employee turned 70 in March, but the payroll software kept deducting CPP through December. The T4 shows more CPP than the CRA calculates for that person. A PIER lists the employee and the CRA’s figures. To answer it, compare the birth date, the payroll register and the slip, then decide whether you agree. The facts, not a template reply, determine what to send.

What to discuss with your accountant

Agree who opens CRA mail and who has online access, because the 30-day window starts when the letter is issued. Ask for a reconciliation of payroll records to the slips before filing, and keep payroll registers and SIN checks. See T4 summary and T4 slip for the filing steps that reduce the chance of a PIER.