Canada Payroll Compliance Map

Canada Payroll Compliance Map

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Send an email to yto4ww@evershinecpa.com
The Manager of Global  Payroll Services
Ms. Kerry Chen, USA Graduate School Alumni & a well-English speaker
Wechat: kchen615
Skype: oklahomekerry

WWT – Canada Payroll Income Tax Deduction

WWT-CA-01 WWT Tax Entity

Question from client:
Is the Canada salary income tax levied in federal or local? Or both federal and local?
Are the federal and local personal income tax that levied separately? Or levied together?
What is the standard withholding tax rate?

Answer from Evershine RD:
Taxed at both federal and provincial/ territorial level. Levied separately.
There are federal and provincial tax deductions table available in T4032.
Follow the table for withholding tax. Refer to the link below:
https://www.canada.ca/en/revenue-agency/services/forms-publications/payroll/t4032-payroll-deductions-tables.html

WWT-CA-02 Registration

Question from client:
The Canada salary income tax collection is under the jurisdiction of which government unit?
The registration of the Canada salary income tax collection status, that is, the application procedure for the employer withholding certificate number, paper certificate number application, or online account application? Website? Employer withholding certificate?
What is the advance certificate number?
Do you need to use the industrial and commercial certificate e-card to apply?

Answer from Evershine RD:
If you already have a business number (BN) and have previously registered for other CRA program accounts (such as GST/HST), you will just be adding a payroll deductions account to your existing program accounts.
To register for a payroll program account, refer to the below link for Business Registration Online (BRO) service.
https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/How-open-payroll-account.html

Another way to apply is to call 1-800-959-5525.
You must prepare the following information to open a payroll program account:
*Date employees receive first wages (leave blank if unknown)
*Months covered for payroll of employee’s wages
*Type of pay period (weekly, quarterly)
*Number of employees
*Payroll service name (if any)
*Country of the parent company or affiliate if you have a foreign-owned corporation
*Name of franchisor (if any)
*Country of franchise’s head office (if any)

WWT-CA-03 WWT Order (OD)

Question from client:
What is the order of Canada’s salary income tax withholding declaration (information flow determines tax base) and payment (fund flow)?
Pay first and then declare?
Report first and then pays?
At the same time as the declaration and payment?

Answer from Evershine RD:
Same Period (SP) – Declaration and payment are due at the same time.

WWT-CA-04 Mechanism of Filing (MOF)

Question from client:
Canada salary income tax withholding declaration (information flow determines the tax base)
What is the method of account return?
Reporting cycle: every month? Every bimonthly? Every season? every half year? Per year?
Electronic filing? Manual filing? Electronic filing and manual filing coexist?
If electronic filing is possible: Web site URL?

Answer from Evershine RD:

Remitter types Average Monthly Withholding Amount (AMWA) Due dates
Regular <$25,000 15th of the following months
Quarterly MWA<$1,000 (new small employers), AMWA<$3,000 15th of the month following the quarter
Accelerated remitter threshold 1 $25,000 to $99,999.99 Remuneration paid in first 15days – 25th of the same month.
Remuneration paid from 16th onwards – 10th of the following month.
Accelerated remitter threshold 2 $100,000 or more Within 3 working days following the last day of the following pay periods:
*1st-7th of the month
*8th -14th of the month
*15th – 21st of the month
*22nd -last day of the month

AMWA = CPP + EI + Income Tax

You can remit the deduction electronically or use paper remittance vouchers (Form PD7A/ Form PD7A(TM)/ Form PD7A-RB) and receive statements of account by mail.
If you remit electronically, you can view your statements and transactions via your online My Business Account.
Yearly – You must file a T4 or T4A information return, as applicable, and send information slips to your employees each year by the last day of February following the calendar year that the information slips apply to.
T4 slips may be filled out electronically using the CRA’s T4 web forms application or filled out in an online PDF.
You may also file the T4 Summary form electronically or in paper form.

WWT-CA-05 Mechanism of Payment (MOP)

Question from client:
What is the funding method for the Canada salary income tax withholding payment (funding flow)?
Payment cycle: M per month? B every bimonthly? Q every season? H every six months? A every year?
Automatically authorize deduction of ACH (that is, take the initiative of the recipient)?
Electronic remittance to EFT (that is, the payer takes the initiative)?
Bank counter payment OCT?
Or the above methods coexist?

Answer from Evershine RD:
In most cases, you must remit your source deductions by the 15th of the month after you pay or give remuneration to your employees.
Remittance due dates are always based on when an employee is paid for their services (payday) rather than the pay period that the services are provided in.
You can view remitting requirements through:
My Business Account at Canada.ca/my-cra-business-account.

Remitter types Average Monthly Withholding Amount (AMWA) Due dates
Regular <$25,000 15th of the following months
Quarterly MWA<$1,000 and AMWA<$3,000 15th of the month following the quarter
Accelerated remitter threshold 1 $25,000 to $99,999.99 Remuneration paid in first 15days – 25th of the same month.
Remuneration paid from 16th onwards – 10th of the following month.
Accelerated remitter threshold 2 $100,000 or more Within 3 working days following the last day of the following pay periods:
*1st-7th of the month
*8th -14th of the month
*15th – 21st of the month
*22nd -last day of the month

AMWA = CPP + EI + Income Tax

Payment option:

  1. Online banking
  2. My Payment – canada.ca /cra-my-payment.
  3. pre-authorized debit
  4. Pay by credit card, Paypal
  5. Pay by cheque

BNF – Deduction of Employee Social Welfare

BNF-CA-01 BNF Entity

Question from client:
Canada’s social insurance, medical insurance, pensions and other employees’ social welfare levy, is it Federal? Is it local? Or is there a Federal plus local?
If there is a Federal and local, are they levied separately? or levied together? What is the withholding tax rate?

Answer from Evershine RD:
CRA’s role includes the following:

  1. Collect Federal and all provincial taxes (except Quebec)
  2. Collect CPP contributions
  3. Collect EI premiums

The deduction rate are as follows:

  1. Canada Pension Plan (CPP)
    – 2021 – Employee 5.45%, Employer 5.45%,
    – 2022 – Employee 5.70%, Employer 5.70%
  1. Employment Insurance – Employee 1.58%, Employer 2.21%

BNF-CA-02 Registration

Question from client:
Social Security Certificate Number? What is the name of the government agency in charge of social insurance?
Medical insurance certificate number? What is the name of the government agency in charge of medical insurance?
Pension certificate number? The name of the government agency in charge of pensions?
How to apply for the social welfare certificate number for employees in the country?
Paper certificate number application? Or online account application? Website?
Need to use the industrial and commercial certificate electronic card to apply?
Are the above three certificate numbers unified or separate?

Answer from Evershine RD:
To register for a payroll program account, refer to the below link.
https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/How-open-payroll-account.html
If an employer has a business number (BN), they only need to add a payroll account to that BN.
Another way to apply is to call 1-800-959-5525.
You must prepare the following information to open a payroll program account:
*Date employees receive first wages (leave blank if unknown)
*Months covered for the payroll of employee’s wages
*Type of pay period (weekly, quarterly)
*Number of employees
*Payroll service name (if any)
*Country of the parent company or affiliate if you have a foreign owned corporation
*Name of the franchisor (if any)
*Country of franchise’s head office (if any)

BNF-CA-03 BNF Order (OD)

Question from client:
What is the order of the withholding declaration of social welfare for Canada employees (information flow determines the tax base) and payment (fund flow)?
Pay first and then declare? Report first and then pays?
At the same time as the declaration and payment?

Answer from Evershine RD:
Same Period (SP) – Declaration and payment are due at the same time.

BNF-CA-04 Mechanism of Filing (MOF)

Question from client:
What is the method of reporting for withholding of social benefits for Canada employees (information flow determines the tax base)?
Reporting cycle: every month? Every bimonthly? Every season? every half year? Per year?
Electronic filing? Manual filing? Electronic filing and manual filing coexist? If electronic filing is possible: Web site URL?

Answer from Evershine RD:

Remitter types Average Monthly Withholding Amount (AMWA) Due dates
Regular <$25,000 15th of the following months
Quarterly MWA<$1,000 (new small employers), AMWA<$3,000 15th of the month following the quarter
Accelerated remitter threshold 1 $25,000 to $99,999.99 Remuneration paid in first 15days – 25th of the same month.
Remuneration paid from 16th onwards – 10th of the following month.
Accelerated remitter threshold 2 $100,000 or more Within 3 working days following the last day of the following pay periods:
*1st-7th of the month
*8th -14th of the month
*15th – 21st of the month
*22nd -last day of the month

AMWA = CPP + EI + Income Tax

You can remit the deduction electronically or use paper remittance vouchers (Form PD7A/ Form PD7A(TM)/ Form PD7A-RB).

BNF-CA-05 Mechanism of Payment (MOP)

Question from client:
What is the funding method for Canadian employee social welfare withholding contributions (funds flow)?
Payment cycle: M per month? B every bimonthly? Q every season? H every six months? A every year?
Automatically authorize deduction of ACH (that is, take the initiative of the recipient)?
Electronic remittance to EFT (that is, the payer takes the initiative)?
Bank counter payment OCT? Or the above methods coexist?

Answer from Evershine RD:
In most cases, you must remit your source deductions by the 15th of the month after you pay or give remuneration to your employees.
Remittance due dates are always based on when an employee is paid for their services (payday) rather than the pay period that the services are provided in.
You can view remitting requirements through:
My Business Account at Canada.ca/my-cra-business-account.

Remitter types Average Monthly Withholding Amount (AMWA) Due dates
Regular <$25,000 15th of the following months
Quarterly MWA<$1,000 and AMWA<$3,000 15th of the month following the quarter
Accelerated remitter threshold 1 $25,000 to $99,999.99 Remuneration paid in first 15days – 25th of the same month.
Remuneration paid from 16th onwards – 10th of the following month.
Accelerated remitter threshold 2 $100,000 or more Within 3 working days following the last day of the following pay periods:
*1st-7th of the month
*8th -14th of the month
*15th – 21st of the month
*22nd -last day of the month

AMWA = CPP + EI + Income Tax
Payment option:

  1. Online banking
  2. My Payment – https://www.canada.ca/en/revenue-agency/services/e-services/payment-save-time-pay-online.html
  3. pre-authorized debit
  4. Pay by credit card, Paypal
  5. Pay by cheque

Please be aware of the below Warning:
The above contents are digested by Evershine R&D  and Education Center in October 2021.
Regulations might be changed as time goes forward and different scenarios will adopt different options.
Before choosing options, please contact us or consult with your trusted professionals in this area.

Contact Us

Toronto Evershine BPO Service Limited Corp.
Send an email to yto4ww@evershinecpa.com
The Manager of Global  Payroll Services
Ms. Kerry Chen, USA Graduate School Alumni & a well-English speaker
Wechat: kchen615
Skype: oklahomekerry

or
For  how to exchange data files between your HR System and Evershine Payroll relevant 5-in-1 System,
Please send an email to HQ4yto@evershinecpa.com
Dale Chen, Principal Partner/CPA in Taiwan+China+UK will be accountable to this exchanging mechanism.
LinkedIn address: Dale Chen

Additional Information
Evershine has 100% affiliates in the following cities:
Headquarter, Taipei, Xiamen, Beijing, Shanghai, Shanghai,
Shenzhen, New York, San Francisco, Houston, Phoenix Tokyo,
Seoul, Hanoi, Ho Chi Minh, Bangkok, Singapore, Kuala Lumpur,
Manila, Dubai, New Delhi, Mumbai, Dhaka, Jakarta, Frankfurt,
Paris, London, Amsterdam, Milan, Barcelona, Bucharest,
Melbourne, Sydney, Toronto, Mexico.

Other cities with existent clients:
Miami, Atlanta, Oklahoma, Phoenix, Michigan, Seattle, Delaware;
Berlin, Stuttgart;Paris; Amsterdam; Prague; Czech Republic; Bucharest;
Bangalore; Surabaya;
Kaohsiung, Hong Kong, Shenzhen, Donguan, Guangzhou, Qingyuan, Yongkang, Hangzhou, Suzhou, Kunshan, Nanjing, Chongqing, Xuchang, Qingdao, Tianjin.

Evershine Potential Serviceable City (2 months preparatory period):
Evershine CPAs Firm is an IAPA member firm headquartered in London, with 300 member offices worldwide and approximately 10,000 employees.
Evershine CPAs Firm is a LEA member headquartered in Chicago, USA, it has 600 member offices worldwide and employs approximately 28,000 people.
Besides, Evershine is Taiwan local Partner of ADP Streamline ®.

(version: 2024/07)

Please send an email to HQ4yto@evershinecpa.com

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