New Business Tool Kit Chapter 4 – Payroll Taxes

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 taxes. The brief summary that follows will give you some guidance in the rules and regulations of the various taxing authorities.

AVAILABLE PUBLICATIONS

T4001, Employer's Guide to Payroll Deductions and Remittances, covers the payroll tax reporting and withholding requirements and can be obtained through the local office of the Canada Revenue Agency (CRA) or on their website.

TAX WITHHOLDING REQUIREMENTS

Every employer is required to withhold income tax, Employment Insurance premiums and Canada Pension Plan payments from employees' pay. Calculation of the appropriate amounts and the corresponding employer amounts are determined by using the employer's guide. The funds withheld are held in trust for the government and must be remitted to Canada Revenue Agency in accordance with the regulations as specified in the guide.