If you are already doing business and managing payroll in Canada or have been considering expanding there, now might be the time to make a move. Canada negotiated new trade agreements with eleven countries on the Trans-Pacific Partnership, creating the most comprehensive trade agreement in existence and changing the competitive landscape. With few barriers to entry and its close proximity to the US, many businesses find Canada is a great place to start with global expansion.
Despite the ease of starting or growing your business in Canada, there are a few factors to consider when expanding there. Canada has strict residency requirements for company board members, as well as tax regulations related to resident vs. non-resident status employees. While Canada is officially bi-lingual English and French, businesses in Quebec are required to communicate in French and comply with a different set of laws and regulations. Having a local partner who can guide you through the language and customs of each province is vital to ensure compliance.
The tax year ends on December 31st. Tax declarations must be made by April 30, 2019.
By the end of 2019 employers are required to submit report to CRA (Canada Revenue Agency).
Here are some of the forms employers may need:
- T4 Employment income
- T4A Other pensions & annuities
Employers also need to:
- Check for outstanding entries to payroll (manual and void/cancelled checks), and update
- Balance the T4/RL-1 report to the payroll register and validate the earnings and deductions
- Make sure correct social insurance numbers have been reported
- Validate pensionable earnings
- Report the taxable benefits on each pay (either when received or as used)
- Complete and file RQ summaries
- Commission de cormes du travail (CNT)
- Workforce Skills Development and Recognition Fund (WSDRF)
- Declaration des activites de formation (only for Quebec employers who pay WSDRF)
- File employer health tax returns, workers compensation/CSST annual return, RQ Annual summary reports
Employees are required to submit T-4 (end year tax reports) by the last day of February.
Required documents for employees:
- Previous year’s tax return
- Previous year’s notice of assessment
- All personal information
- T4s for employment income
- T3s for trust and dividend income
- T5s investment income
- Universal child care benefit
- Pension income
- Child care payments
- RRSP paid during the year up to the end of February
- Home office expenses
- Charitable donations
- Public transit passes (only applies for before June 2019)
- Medical expenses
- Tuition fees
- Moving expenses that were not reimbursed
- Interest on loans paid to earn investment income
From startups to growing enterprises, companies with operations and payroll in Canada require sophisticated payroll management software and global payroll solutions. With the right payroll management technology, it’s possible to streamline processes and ensure total payroll compliance. Blue Marble Payroll is a trusted provider of global payroll solutions, equipping your business with best-in-class technology and services in Canada and around the world.