PAYROLL DEDUCTIONS / T4 / WORKERS COMPENSATION
Payroll Deductions / T4’s / Worker’s Compensation in Vancouver BC
As an employer, you are responsible for deducting, remitting, and reporting payroll deductions. An employer must do the following:
- Open and maintain a payroll deductions account
- Obtain the employee’s social insurance number
- Ensure employees fill out federal TD1 and provincial TD1 forms
- Deduct CPP contributions, EI premiums, and income tax from the employees’ pay and withhold this in trust for the Receiver General
- Remit these deductions along with the employer’s share of CPP contributions and EI premiums
- Report the employees’ income and deductions on the appropriate T4 or T4A slip by the last day of February of the following calendar year
- Complete and issue Record of Employment Form INS 2106 when an employee leaves
- Keep all payroll records for a period of six years
The following are some common situations where employment is not insurable and is not subject to EI premiums:
- Casual employment
- Employment when the employee and employer do not deal with each other at arm’s length; such as individuals connected by blood relationship, marriage, common-law relationship, or adoption
- Employment of a person who controls more than 40% of the corporation’s voting shares
- Employment that is an exchange of work or services
Payroll source deductions for each month are always due by the 15th of the following month. Canada Revenue Agency can assess a penalty of 10% up to 20% for the amount you fail to remit. Should the 15th of the month falls on a Saturday, Sunday, or public holiday, Canada Revenue Agency will consider the payroll remittance due on the next business day.