Irrespective of the form of business in which you operate, if you are going to have employees then you will have to contend with payroll deductions and remittances. The brief summary that follows will give you some guidance in the rules and regulations of the various taxing authorities.
- Employers must withhold income tax, Canada Pension Plan ("CPP") & Employment Insurance ("EI") premiums from wages each pay period and remit these withholdings along with the employer's share of CPP and EI.
- New businesses are require to remit payroll deductions on a monthly basis. Remittances are due on the 15th of the following month.
- Every company is required to prepare a T4 information return consisting of a summary and slips. Slips for each employee must be prepared summarizing his or her wages, benefits, CPP, EI, and union dues amongst others paid during a particular calendar year. Your employees must receive a copy of their T4 slip by the end of February of the following year. In addition, a copy of each T4 Information Return must be received by CRA by the same date.
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