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KWB offers a variety of payroll remittance options to suit your business’s needs, ensuring timely and accurate payment of taxes and other deductions. These options are designed to simplify your payroll process, allowing you to focus on running your business while we handle the complexities of compliance. We can help you choose the best payroll remittance options for your specific situation.
Overview
This article explores various payroll remittance options available to businesses, detailing the requirements and benefits of each. It also includes a labeled real-world hypothetical to illustrate how different choices affect a business’s operations.
- Understanding Choices: Discover how to select the right payroll remittance approach for your company.
- Regular Remittance: Learn about the standard payroll remittance process and its obligations.
- Key Information: Find essential details for businesses managing regular payroll submissions.
- Quarterly Eligibility: Review the criteria and advantages of quarterly remittance options.
- Canadian Businesses: See specific considerations for Canadian payroll remittance.
- FAQ: Get answers to common questions about payroll remittance.
KWB: Understanding Your Payroll Remittance Options
Depending on the amount of your payroll remittance you may have some options as to when you are required to remit it to CRA.
Regular Payroll Remittance: What Businesses Need to Know
You are a regular remitter if you are a new employer or your average monthly withholding amount (AMWA) two years ago was less than $25,000. In this case you are required to have your payroll remittance to CRA on or before the 15th of the month following the month you paid your employees.
Regular Payroll Remittance: Key Information for Businesses
This option is available to new small employers or to existing companies who have had their payroll account for at least a year and meet certain criteria.
New small employers
You qualify for quarterly payroll remittance for the first year if your monthly withholding amount is less than $1,000 and you have a perfect compliance history. Perfect compliance history means that over a 12 month period, you have made all deductions and payroll remittances on time, have paid and filed your GST on time and have filed your T4 information returns on time.
All payments made after the due date may be charged a 3% to 10% penalty
Existing small employers
To qualify for quarterly payroll remittance you have to have an average monthly withholding amount of less than $3,000 in either the first or second preceding calendar year and have a perfect compliance history as explained above.
Due dates
If you qualify for quarterly payroll remittance, CRA must receive your payroll remittance on or before the 15th day of the month immediately following each quarter. Quarters are: January to March; April to June; July to September and October to December.
Quarterly Payroll Remittance: Eligibility and Benefits
This includes employers who had a total average monthly withholding amount of $25,000 to $99,999 two calendar years ago. Note that if a corporation is associated with one or more corporations in the current year, and the total AMWA of all the associated corporations was $25,000 or more two years ago, CRA considers all the associated companies to be accelerated remitters. The same rule applies to companies with more than one payroll account such as RP0001 and RP0002. If the AMWA was $25,000 or more two years ago, CRA considers both accounts to be accelerated remitters.
Due dates
If you are an accelerated remitter threshold 1, CRA must receive your deductions by the following dates:
For remuneration paid in the first 15 days of the month, remittances are due by the 25th day of the same month.
For remuneration paid from the 16th to the end of the month, remittances are due by the 10th day of the following month.
Quarterly Payroll Remittance for Canadian Businesses
This includes employers who had a total average monthly withholding amount of $100,000 or more two calendar years ago. Note that if a corporation is associated with one or more corporations in the current year, and the AMWA of all the associated corporations was $100,000 or more two years ago, CRA considers all the associated companies to be accelerated remitters. The same rule applies to companies with more than one payroll account such as RP0001 and RP0002. If the AMWA was $100,000 or more two years ago, CRA considers both accounts to be accelerated remitters.
Due dates
Amounts deducted from remuneration paid at any time during the month must be received by your Canadian financial institution no later than the third working day after the end of the following periods:
- From the 1st through the 7th day of the month
- From the 8th through the 14th day of the month
- From the 15th through the 21st day of the month
- From the 22nd through the last day of the month
(For example, for a payday that falls on Friday June 17th, the remittance due date would be June 22nd, three working days after the payday.)
Note: Employers In this category MUST pay their payroll remittance at their financial institution. Payments made on the due date but not at a financial institution may be charged a penalty of 3% of the amount due. All payments made after the due date may be charged a 3% to 10% penalty, depending on how many days late the payroll remittance is.
If you would like more information or have any questions, feel free to contact us at 780.466.6204, or click here to send us an email.
Thanks to Haley Bistretzan of KWB Chartered Accountants for providing this content.
FAQ
Below, we’ve compiled answers to some common questions regarding payroll remittance options, helping you navigate the complexities of this essential financial responsibility.
| Question | Answer |
|---|---|
| What are the various payroll remittance options available to businesses in Edmonton? | In Edmonton, businesses can choose from three main payroll remittance options: electronically via the CRA’s My Business Account, through their financial institution, or by utilizing third-party payroll service providers. The optimal method for your Edmonton business will depend on its size and available accounting resources. |
| What factors dictate the frequency of payroll remittance to the CRA for businesses in Edmonton? | For businesses in Edmonton, the Canada Revenue Agency (CRA) dictates payroll remittance frequency primarily based on the total amount of payroll deductions withheld. Businesses with lower withholding amounts might remit monthly, while those with higher amounts could be required to remit more frequently. Understanding your specific remittance schedule is crucial to avoid penalties. |
| How does timely payroll remittance affect a business’s compliance and financial standing in Edmonton? | For businesses in Edmonton, timely payroll remittance ensures compliance with Canada Revenue Agency (CRA) regulations, avoiding penalties and interest. It also maintains accurate employee benefits and taxes, which is crucial for good standing with both the CRA and your workforce. |
| How can Edmonton businesses partner with KWB Accountants & Advisors to modify their payroll remittance schedule? | KWB Accountants & Advisors in Edmonton can help your business review its payroll withholding amounts and formally request a change in your remittance schedule with the CRA. We ensure your Edmonton business remains compliant and avoids potential penalties. |