Canadian Payroll Reporter

March 2019

Focuses on issues of importance to payroll professionals across Canada. It contains news, case studies, profiles and tracks payroll-related legislation to help employers comply with all the rules and regulations governing their organizations.

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News March 2019 Employers that do not have remittances to pay for a month or a quarter must notify the CRA. True or False? True. Employers must notify the CRA by their remittance due date or as soon as they know they do not need to make source de- ductions for a month or a quar- ter. The CRA says this can occur if the employer has no employ- ees or has seasonal workers. Employers with a nil remit- tance must inform the CRA of when they will make their next remittance. Employers who do not know are advised to provide an estimated date. Otherwise, the agency says it will expect the employer to remit amounts for the next month or quarter. Employers are categorized as accelerated remitters if their AMWA from two calen- dar years ago exceeds $50,000. True or False? False. There are two groups of accelerated remitters: threshold 1 and threshold 2. The CRA puts employers in threshold 1 if their AMWA from two years ago was between $25,000 and $99,999.99. It plac- es them in threshold 2 if their AMWA from two years ago was at least $100,000. It classifies other employers as regular (monthly) remitters if their AMWA from two years ago was below $24,999.99. Some em- ployers with a very low AMWA (for example, under $3,000) may qualify as quarterly remitters if they meet CRA criteria. Employers do not need to apply to the CRA to be quar- terly remitters. True or False? True. Employers who have had an account with the CRA for at least a year may qualify as quarterly remitters if their AMWA from either one or two calendar years ago is less than $3,000 and they have a perfect record over the last 12 months for deducting and remitting withholdings, paying GST/HST, and filing T4 returns. If they do, the CRA will no- tify them in November that they qualify as a quarterly remitter. Afterwards, they can continue to send in remittances quarterly unless notified. New employers can remit quarterly if they meet two crite- ria: their monthly withholding amount is less than $1,000 and they maintain a perfect record of complying with CRA rules for their GST/HST and payroll ac- counts. The monthly withhold- ing amount is the amount the employer would have to send in if it were a regular remitter. They do not need to apply to do this. Based on the information they provided when they regis- tered, the CRA will notify them if they are quarterly remitters. Quarterly remittances are due by the 15th day of the month im- mediately after the end of the quarter. Threshold 2 remitters must send in remittances semi- monthly. True or False? False. Threshold 2 remitters must send in their remittances up to four times a month. Their remittances are due three work- ing days after the end of the re- mitting period. The remitting periods run from the first to the seventh of the month, the eighth to the 14th, the 15th to the 21st, and the 22nd to the end of the month. Employers with multiple payroll accounts with the CRA may be classified into more than one remittance category. True or False? False. Regardless of the num- ber of payroll accounts an em- ployer has with the CRA, the employer's remitter type will be the same for all accounts. The CRA charges a flat pen- alty of $100 a day for each day that an employer is late with its remittance. True or False? False. The CRA uses a gradu- ated penalty structure for late remittances. For those that are one to three days late, it charges three per cent of the amount due. The penalty rises to five per cent if the remittances are four or five days late. The penalty increases to seven per cent if the remittances are six or seven days late. If they are more than seven days overdue, the CRA charges a penalty of 10 per cent of the amount due. The penalties are in addition to inter- est charges. For subsequent offences in the same calendar year, the CRA may increase the penalty to 20 per cent if the employer acted with gross negligence or made the failure knowingly. The CRA says it will generally only apply a penalty when em- ployers fail to remit on amounts greater than $500; however, it will penalize employers for fail- ing to remit on lesser amounts if they acted with gross negligence or knowingly did not send in the remittances or knowingly sent them in late. The CRA can also penalize threshold 2 remitters who do not follow its remitting rules. For in- stance, it requires threshold 2 re- mitters to make their payments electronically or in person at their Canadian financial institu- tion. If the CRA receives the pay- ment at least a full day before the due date, it will consider that the employer made the payment at a financial institution and will not charge a penalty. However, it can charge a pen- alty for payments that a thresh- old 2 remitter makes on the due date, but not at a financial insti- tution. The penalty will be three per cent of the amount due. If you got all or most of the questions correct, congratula- tions are in order. You are well aware of your federal remitting rules. News Does the CRA charge daily fees for late remittances? from QUIZ on page 3 Published 12 times a year by Thomson Reuters Canada Ltd. Subscription rate: $189 per year Customer Service Tel: (416) 609-3800 (Toronto) (800) 387-5164 (outside Toronto) E-mail: customersupport.legaltaxcanada@tr.com Website: www.payroll-reporter.com One Corporate Plaza 2075 Kennedy Road Toronto, Ontario, Canada M1T 3V4 Director, Media Solutions, Canada Karen Lorimer Publisher/Editor-in-Chief Todd Humber Editor Sheila Brawn sbrawn@rogers.com Editor/Supervisor Sarah Dobson News Editor Marcel Vander Wier Sales Manager Paul Burton paul.burton@tr.com (416) 649-9928 Marketing & Audience Development Manager Robert Symes rob.symes@tr.com (416) 649-9551 Circulation Co-ordinator Keith Fulford keith.fulford@tr.com (416) 649-9585 Payroll Reporter Can R Can R adian adian a www.payroll-reporter.com ©2019 Thomson Reuters Canada Ltd ISBN/ISSN: 978-0-7798-2810-4 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, photocopying, recording or otherwise without the written permission of the publisher (Thomson Reuters, Media Solutions, Canada). Return Mail Registration # 1522825 | Return Postage Guaranteed Paid News Revenue Toronto Canadian Payroll Reporter is part of the Canadian HR Reporter group of publications: • Canadian HR Reporter — www.hrreporter.com • Canadian Occupational Safety magazine — www.cos-mag.com • Canadian Safety Reporter — www.safety-reporter.com • Canadian Employment Law Today — www.employmentlawtoday.com • Canadian Labour Reporter — www.labour-reporter.com • Canadian Payroll Reporter — www.payroll-reporter.com For subsequent offences in the same calendar year, the CRA may increase penalties to 20 per cent.

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