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What U.S. Companies Need to Know About Stat Pay & Benefits in Canada

Posted by Stacey Duggan

|

May 6, 2014 8:30:00 AM

Employee ‘Benefits’ are Very Different Across the Border

In Canada the health care system is government run with the funding coming from employer taxation. All Canadian citizens can register for a health card and are eligible to have their basic medical needs covered under this program. 

Each province has its own system but in its simplest form it means that Canadians do not pay out of pocket for doctor’s visits, emergency care, surgery, most diagnostic testing and short term medical leave.  Many Canadian companies offer employees a benefit program that offers coverage for those medical needs that are not part of this government system such as prescriptions and dental care.

When a U.S. company looks to match their U.S. employee benefits with those being offered to a Canadian employee, this is an important differentiator that needs be considered. 

Many U.S. companies offer employees a 401k plan and can also offer something similar in Canada called an RSP (Retirement Savings Plan).  Some differences to note in regards to the two are that the Canadian RSP can be set up through any financial institution and the employee can choose to contribute after tax dollars into their own plan.

A 401k has a set annual limit that is the same for every employee regardless of income where in Canada the annual limit is 18% of salary to a maximum of $20,000. In Canada these unused limits can be carried forward indefinitely where in the U.S. contribution amounts have to be used each year or they are lost.

Canadian Holidays Vary Slightly by Province 

Canadian holidays are not the same as those in the United States and in fact vary slightly from province to province. The statutory holidays that are the same across every province include; New Year’s Day on January 1st, Good Friday on the Friday before Easter Sunday, Canada Day on July 1st, Labour Day on the first Monday of September and Christmas Day on December 25th.

Stat Holiday Pay Eligibility

Every province has different rules in regards to statutory holiday pay eligibility. For example, in Ontario an employee is eligible to be paid for a stat holiday right from day one, in Alberta the employee must have been employed for the last 30 days before the holiday with actual working days totalling more than 15 in order to start receiving this pay. Stat holiday pay calculation is based on previous hours worked within a certain timeframe.

Looking to hire a Canadian but Unsure of Canadian Employment Law?

The Payroll Edge’s EOR service is similar to a PEO service in the United States and works to take the strain off U.S. or foreign based employers hiring and paying Canadian employees but who are unfamiliar with employment laws in Canada. An Employer of Record (EOR) service like The Payroll Edge can take care of benefits packages’, payroll calculation (including statutory pay), payroll tax deductions as well as government remittances for your Canadian employees and so much more.

Download our free PDF "Statutory Holidays in Canada" Chart to Track your Canadian Employees Holiday Pay:

Statutory Holidays in Canada  The Payroll Edge PNG Picture resized 600

Topics: Employer of Record, Best Payroll Calculator, Paying a Canadian, Pay Canadian Employees, Paying Canadian Workers, public holiday pay, stat holidays

Why a Canadian Payroll Calculator Can Be Your Best Friend

Posted by Stacey Duggan

|

Jan 28, 2014 10:25:00 AM

describe the imageWhen trying to navigate the complexities of Canadian payroll laws, it’s good to have a friend on your side. A Canadian payroll calculator can be that friend. For US-based businesses, Canadian laws can be especially cumbersome and difficult to overcome. Like a good friend, a Canadian payroll calculator can offer advice, guidance, and encouragement. That advice and guidance can keep you from making costly mistakes, while encouragement can keep you going even when complying with the laws seems impossible. There are a lot of tools you can use to ease your Canadian expansion, a Canadian payroll calculator is one that will make it feel like you have a trusted friend in your corner.

Advice When You Need It

Sometimes, you just need to know if you’re on the right track. A Canadian payroll calculator can help you determine if your withholding calculations are near the mark. By entering some basic employee information, you can get an overview of the most typical tax situations in different provinces. While it can’t give you information on every possible scenario, a Canadian payroll calculator can give you a good starting point for the most common tax situations. Best of all, like a trusted friend, a payroll calculator is available whenever you need it. You don’t have to wait for business hours, or make an appointment—just open the calculator and start getting help.

An Ounce of Prevention

Like a good friend, a Canadian payroll calculator can help keep you from becoming your own worst enemy. If the advice it gives varies wildly from your own calculations, then you should double-check your numbers. It’s possible that you’re entering erroneous information, or misinterpreting some aspect of the law. If you ignore the advice and stick to your own numbers, you may be opening yourself up for future legal consequences. While the calculator won’t be right in every instance, broad discrepancies should be thoroughly investigated. If you can’t decide between your numbers, and the numbers the calculator gives you, then it’s time to consult a professional.

In Over Your Head

A good friend will tell you when it’s time to talk to an expert. If a Canadian payroll calculator is consistently showing that your numbers are off, that’s an indication that it’s time to get professional help. There are a lot of complexities to Canadian payroll law, and it’s possible that you’re missing something important. The calculator has no way of knowing if it’s a worker classification problem, a job-site location issue, or a simple arithmetical error. All it can do is take the information you give it, and provide its best guess based on the most common regulations. For anything beyond that, you need to talk to a payroll professional.

In this Case, Good Friends are Easy to Find

Fortunately, it’s easy to find other trusted friends for your corner. A professional payroll service, like The Payroll Edge, can handle all of your Canadian payroll needs for you. They have a highly-trained, highly-experienced staff of payroll professionals. With their help, you’ll speed up your payroll process, while also minimizing the chances of an audit or penalties. Using a professional payroll service takes all of the guesswork out of handling your payroll, while also freeing up your staff to handle other tasks. While a Canadian payroll calculator can help you do it yourself, a payroll service provider can do it for you.

Canadian Payroll Tax Deduction Calculator

Topics: Payroll Service Provider, Canadian Payroll, Canadian Payroll Service, Best Payroll Calculator, Payroll Calculator, CRA, Canadian Payroll Calculator, Payroll Tax Laws in Canada, Full Service Payroll Provider

5 Ways Using a Payroll Service Makes Sense

Posted by Stacey Duggan

|

Nov 6, 2013 9:00:00 AM

5 Ways Using a Payroll Service Makes SenseMany small business owners start out handling payroll on their own. As their company grows, it becomes increasingly difficult and time consuming to keep up with payroll. By that time, the company usually has some kind of HR manager or administrator, and they often inherit the payroll responsibilities. They become a default payroll manager, regardless of whether they have the training and experience to handle the needs of a growing company. This takes away from their HR responsibilities, and puts your payroll in the hands of someone who may not be able to dedicate the necessary time to do it right.

Instead of handing off your payroll needs from one employee to the next, it makes more sense to hire a payroll service. Payroll providers have the training, experience, and knowledge to handle the payroll needs of any size company. A payroll provider lets you and your staff stay focused on the business at hand, while your payroll needs receive the attention they deserve. Here are five ways that hiring a payroll service makes sense for your company:

Counting the Minutes

Every minute you spend on payroll is a minute that’s not focused on your core business activities. As the hours add up, and you answer employee queries, and read up on the latest legislative changes, more productive pursuits are being delayed.

A payroll service deals with payroll needs every single day. They don’t have other responsibilities that consume their attention. They can handle your payroll needs quickly, efficiently, and accurately. You will be able to spend more of their time focused on growing your business.

Time is Money

By saving you time, a payroll service saves you money. They also save you money by ensuring that your payroll is handled right the first time. Mistakes in payroll can be expensive. Cutting new cheques, making back payments, and government fines can quickly add up. The easiest way to avoid all of these potential expenses is by using a payroll service provider.

Focus on Service

When someone in your company handles payroll, they can’t always give immediate attention to questions or concerns. If you have a problem, you either have to interrupt the payroll manager, or wait for them to get back to you.

With a payroll service, they’re always working on payroll. When you call with questions or concerns, that’s just another part of what they do every day. Since they handle customer queries all the time, they can have the right answer for you right away. 

Get it Right

A lot of payroll mistakes can be traced to ignorance of changing legislation. Even when the legislation doesn’t change, it can be incredibly complex. Your payroll manager may not have the time to research all of the intricacies of the law, let alone keep up with the constant changes.

A payroll service understands the laws, as well as their application. They often participate in crafting new laws, so they have a deep understanding of the issues. Keeping up with changes is part of their day-to-day routine. This makes it easy for them to avoid mistakes that can lead to fines and back payments.

Expert Guidance

As your business grows and changes, you’ll need advice on future payroll issues. It’s unlikely that your payroll manager will have the experience to help guide that growth.

A payroll service handles clients of all sizes and stages of growth. This gives them unique insights into the challenges faced by businesses. This insight can prove invaluable in helping you steer your company into the future.

7 Signs It's Time to Outsource Payroll

Topics: Payroll Service Provider, Outsourced Payroll Service, Best Payroll Calculator, Payroll Deductions, Dependable Payroll Service, Payroll Tax Laws in Canada, Great Payroll Service Provider, Small Business Operations, Small Business Payroll

Why Hiring a Payroll Clerk May Be the More Expensive Option

Posted by Stacey Duggan

|

Oct 21, 2013 9:00:00 AM

Why Hiring a Payroll Clerk May Be the More Expensive OptionAs a company grows, it becomes necessary to find a permanent solution to payroll processing. With the many details, regulations, procedures, and filings involved with payroll processing, delegating payroll responsibilities to an existing employee, or trying to take care of it yourself, becomes an unsatisfactory option. Some business owners or managers try to solve the payroll puzzle by hiring an in-house payroll clerk. This solution is probably better than trying to manage payroll yourself, but it has some serious drawbacks.

HR Overhead Costs

When you hire a payroll clerk, you take on numerous new overhead costs. First off, there's the cost of hiring, which includes advertising the job, reading through resumes, interviewing, and getting your new employee integrated in your payroll system. There's training to consider, which could involve off-site training, courses, and conferences to get your new employee up-to-speed with current payroll regulations. Your new payroll clerk needs a place to work, equipment, and software. Additionally, you'll need to consider the costs you incur with a new employee: benefits, insurance premiums, your portion of CPP contributions and EI premiums, and paid vacation and sick days.

Vacation/Sick Days

Payroll never sleeps. Your employees need to get paid, and your government remittances must be submitted continually, whether or not your payroll clerk gets sick, takes a vacation, or needs personal time away from the office. Remittances must be sent in on time if your company is going to avoid fines levied by the CRA, and a single payroll clerk managing payroll processing for a whole company may have a hard time meeting every single deadline. Outsourced payroll processing, on the other hand, can manage payroll no matter what. They can guarantee that everything will be done in a timely fashion, and they don't require vacation days or sick leave.

Turnover

A good payroll clerk may get a firm grasp on everything it takes to manage your payroll effectively. Getting to this point takes time and consistent effort because payroll is complicated, and the regulations change from year to year. What will you do when your expensive, painstakingly trained payroll clerk gives notice and leaves your firm? You'll be back at square one, looking for a new employee who doesn't understand the ins and outs of your company and may require substantial training before you can feel comfortable with the state of your payroll again.

These problems can be avoided by turning your payroll processing over to an outsourced payroll processing company rather than hiring your own clerk. With outsourced payroll processing, you don't have to worry about adding to your HR overhead costs. Payroll won't require any square footage of your office space, it won't require that you buy any new equipment or specialized software, and you won't have to pay additional employee benefits. You also won't have to worry about the state of your payroll when someone wants to take a vacation. You'll just know that it always gets done faithfully, no matter who is in (or out) of the office. Finally, there are no turnover worries when it comes to outsourced payroll processing. Although your contact at the outsourced payroll processing company could change from time to time, your payroll will always be handled professionally and in a timely manner. Compared with outsourced payroll processing, hiring your own in-house payroll clerk may be the more expensive option.

7 Signs It's Time to Outsource Payroll

Topics: Payroll Service Provider, Outsourced Payroll Service, hire payroll service, Best Payroll Calculator, CRA, payroll solution, Dependable Payroll Service, Employee Training and Development, Great Payroll Service Provider, Hiring a Payroll Clerk, Payroll Expertise

The CRA is Watching – 5 Audit Red Flags

Posted by Stacey Duggan

|

Oct 9, 2013 11:06:00 AM

CRA is Watching 5 Audit Red FlagsHow does the CRA make sure that Canadian businesses comply with current tax law? They audit. A CRA audit can come in one of three flavors: Income Tax Audit, HST/GST Audit, and Employer Compliance Audit.

The Income Tax Audit is the most basic (and least painful) type of CRA audit. Essentially, the CRA will examine the amount of money you spent and earned. This isn't to say that an Income Tax Audit won't impact your business. It will cost you time and money.

The HST/GST Audit verifies that you have been faithfully collecting and remitting GST/HST (Goods and Services tax/ Harmonized sales tax). This CRA audit is more involved than the Income Tax Audit.

The Employer Compliance Audit is used to ensure proper withholding and remittance. It's important to note that the CRA also examines taxable benefits in this audit.

You may feel a little better knowing that the CRA will not perform both the Income Tax Audit andthe HST/GST Audit on the same firm. That's small comfort, however, when you realize that a CRA audit is time-consuming, tedious, expensive, and intrusive. It's best to avoid an audit from the start, and the best way to do that is to avoid the following red flags:

1. Neglecting to pay CPP or EI.

One of your responsibilities as a Canadian employer is to withhold CPP contributions and EI premiums from your employees' pay cheques and then to send these funds along to the CRA. In addition to your employees' contributions and premiums, you must add your own contributions to these funds. If you don't, the CRA will require that you cover both your own portion and that of your employees.

2. Reporting Consecutive Losses.

Nobody likes to admit that their businesses are suffering – until tax time, that is. The government allows for losses by offering extra tax credits. This helps fledgling businesses to make it past those difficult first years. If you report four or more consecutive losses, however, the CRA will likely audit to see what's going on.

3. Failing to Hire an Accountant or Outsourced Payroll Processing Firm.

The CRA knows that when people handle their accounting themselves, they're more prone to making errors. In addition, when you handle your own accounting, there's more temptation to include income or expenses that shouldn't be included in your reports. For these reasons, the CRA is more likely to audit small businesses who handle their accounting themselves.

4. Reporting Excessive Business Expenses.

If you report business expenses that are much higher than you usually report, or if your business expenses are higher than other similar businesses in your area, the CRA may want to find out why. Sometimes businesses report higher-than-usual business expenses when they face a big expansion or remodeling project. You can avoid this red flag by spreading your business expenses out over several years instead of tackling everything at once.

5. Receiving Most of Your Income in Cash.

The CRA looks for unreported income, and cash deposits will be scrutinized. You should be able to explain each of your cash deposits, especially if they're not being reported as income. The CRA especially targets small businesses when it comes to analyzing cash income.

An outsourced payroll processing service can help to minimize your risk of a CRA audit by guaranteeing proper withholding and remittance, helping you to become 100% compliant, and structuring your payroll processes to avoid audit red flags. If you feel that you're currently on shaky ground when it comes to a CRA audit, take steps today to improve your situation and your peace of mind.

7 Signs It's Time to Outsource Payroll

Topics: Outsourced Payroll Service, CRA Audit, Government Compliance, Best Payroll Calculator, CRA, CRA Compliant, CPP, EI, Tax Laws, Canadian Businesses, Audit Red Flags

What is Time Theft, and How to Avoid It

Posted by Stacey Duggan

|

Oct 7, 2013 10:54:00 AM

What is Time Theft and How to Avoid ItIn tough financial times, businesses try to streamline their operations to run as inexpensively as possible. They may reduce business hours, lease less property, or make changes to products and services. One lesser known strategy for reducing expenses is to tackle the problem of time theft.

What is time theft?

Time theft is a worker getting paid for work they did not actually do, and it costs Canadian businesses as much as $5 billion per year. As you can imagine, time theft has a big impact on the financial success of businesses, and it could be hurting yours.

Let's take a look at some of the ways time theft could be eroding your company’s profits.

1. A faulty "punch card" system.

Employers have different ways of clocking their employees' hours, and sometimes employees figure out how to manipulate the system so it looks like they're working more than they actually are. This happens when employees "punch in" for each other or find a way to clock in remotely. If you feel that there are inefficiencies or "holes" in the way you track employee hours, take a close look at your system. Your bottom line could be severely affected by this form of time theft.

2. Personal time on the phone.

Everyone has to make personal phone calls from time to time, and sometimes it's necessary to handle personal matters during business hours. Every employer understands this. But when employees make a habit of spending time on personal phone calls while they're supposed to be working, they are committing time theft. In essence, you are paying them to handle their personal lives instead of paying them to complete the work they agreed to. Review your company's policies about personal phone time, and inform employees that they must abide by these policies.

3. Tardiness, long breaks, and leaving early.

This form of time theft is not as common for hourly employees, but it's not uncommon with salaried workers. When employees stretch a 30-minute break to 45 minutes, and when they come in late or leave early, they are stealing from your company. If this is a chronic problem in your company, re-evaluate your procedures for managing your employees' time on the job. Does a supervisor need to pay more attention to break times? Do you need to schedule early morning meetings to hold employees accountable for arriving on time?

4. Non-work computer usage.

The Internet is a minefield of distractions, and it's all too easy for employees to let their attention stray away from their work while they're on the computer. There are many things you can do to help your employees avoid this time theft temptation. Turn computer screens toward a public area so anyone walking by can see what's on the screen. Instruct your system administrator to block social media sites and YouTube. During your training and instructional meetings, remind employees that their work computers are for just that: work. And help them to develop good work habits and standards for themselves that will help them to be more productive employees.

By paying attention to time theft and how it affects your company's productivity, you can save money and improve your employees' work. For more information about time theft, or to discuss other human resource and payroll issues, contact us at The Payroll Edge. Our payroll experts can help you to find solutions to your problems.

What Are You Leaving to Chance by Handling Payroll on Your Own

Topics: Payroll Service Provider, Canadian Payroll, Canadian Payroll Service, hire payroll service, Best Payroll Calculator, human resources, Employee Policies, Temporary Staff Agency, Temporary Workers, Time Theft, Human Resources Issues

3 Ways Payroll Processing Can Be Made More Efficient

Posted by Ray Gonder

|

Oct 4, 2013 4:18:00 PM

3 Ways Payroll Processing Can Be Made More EfficientProcessing payroll adds a thick layer of administrative work to your already hectic days. Payroll is complicated, ever-changing, and annoyingly details-oriented. In an effort to streamline operations and be more efficient, Canadian employers generally opt for one of the following three methods.

1. Forget About It.

Sure, you'll still pay your employees, but you won't bother with all that troublesome CRA stuff. Think about it: if you didn't have to maintain your CRA account, calculate deductions, take care of payroll remittance, and mess with those troublesome T4 Slips and year-end reports, you'd be as free as a bird. You could get so much more done. You could actually focus on the exciting and profitable parts of your business.

There's just one problem with this method of processing payroll . It's so illegal that your business will probably not last very long. The first month or two that you fail to deduct and remit payroll taxes from your employees' pay cheques, the CRA will levy fines, penalties, and interest on your company. If you still persist in ignoring your legally obligated payroll duties, you may be prosecuted, fined again, and possibly even imprisoned. Clearly, this is not a good option for streamlining your company's payroll processing.

2. Hire a Full-Time Payroll Clerk.

If you've decided that the first option is not for you, you might consider hiring a full-time payroll clerk. A full-time payroll clerk would have time to take care of all the details for you so you would be free to manage your business and do what you do best. Essentially, you'd be hiring an employee to take care of administrative work that doesn't directly benefit your business. And you'd have to pay for benefits for this employee, including employer contributions to benefits and Employment Insurance.

This gets to be quite expensive, and although you'd have a person on your staff to manage the day-to-day headaches incurred by processing payroll, you're still ultimately responsible for this person's job performance. If your full-time payroll clerk doesn't have the experience to manage complicated payroll issues, or if the laws change and your clerk is unaware of the changes, you're still responsible for any problems. So while this option is better than the first option, it still comes with some drawbacks. Is there a better way?

3. Outsource Payroll Processing.

Wise employers know better than to neglect payroll responsibilities or to hire a full-time, on-staff worker to handle them. They know that forming a partnership with a payroll processing service provider can get them expert service at a reasonable price, leaving them time to focus on running and growing their businesses.

Payroll service providers like The Payroll Edge can guarantee that your payroll will be processed correctly every time, and they have experts on-staff who can answer tricky questions and find solutions to unusual circumstances. They have contacts at the CRA, so it's easier for them to reach governmental agencies to get specific answers than it would be for you or for one of your employees. Best of all, a reputable payroll processing firm will understand the details of your payroll, ensure its accuracy, and know how your payroll affects your company's legal compliance. A partner like this is an incredible asset to your company.

If processing payroll has become a heavy burden for you and for your company, do yourself the favor of investigating the third option: outsourcing payroll processing. To learn more about how outsourced payroll processing can benefit your company, contact us at The Payroll Edge.

7 Signs It's Time to Outsource Payroll

Topics: Payroll Service Provider, Payroll Service, Payroll, Employee Payroll Deductions, Government Compliance, Best Payroll Calculator, CRA, payroll solution, Dependable Payroll Service

3 Common CRA Remittance Pitfalls

Posted by Stacey Duggan

|

Jul 24, 2013 9:00:00 AM

3 Common CRA Remittance PitfallsIt seems that remitting your payroll deductions to the CRA should be a simple, straightforward process, and yet, Canadian businesses run into problems time and again. Part of this has to do with legislative and bureaucratic changes that catch people unawares. Sometimes small business owners just have too many things on their minds; it's hard to keep up with everything, especially with things like CRA remittances which don't help your business to stay afloat or improve your bottom line. Let's take a look at three common CRA remittance pitfalls and how to avoid them.

1. Not sending in your remittance on time

This is probably the biggest mistake that employers make, and it's no surprise. The money collected from payroll may sit in your business account for weeks or even months before it's due to the CRA, so it's easy to forget about remitting. Do your best to stay on schedule, however, because the penalties for failing to remit are stiff and increase the more time you take. Not only the fee but the whole amount is subject to interest making a late payment much more costly than the timely payment would have been.

Companies with a 12-month history of remitting compliance and who have a monthly withholding amount of less than $3,000 may be eligible to remit quarterly instead of monthly. You will be notified by the CRA if your business qualifies for quarterly remittance. Otherwise, you'll be expected to remit monthly, and it's important that you keep up with your deadlines.

2. Remitting less because you're treating some employees as independent contractors

A worker engaged with your company who has a registered business, doesn’t always qualify to be paid as an independent contractor in the eyes of the CRA. As a business owner, you need to be aware of how to properly classify independent contractors in order to be compliant. A finding of misclassification can lead to the payment of both the employee and employer portion of the remittances going back as far as the initial engagement. If the CRA finds that you have violated the law, you will also be charged interest and penalties, which can add up very quickly.

3. Calculating remittances incorrectly

It's a lot to keep track of, but you need to remit CPP contributions, income taxes, and EI premiums from your employees' earnings, along with your share of EI premiums and CPP contributions for each employee. Recognizing taxable benefits and calculating then remitting them correctly is another area that is often misunderstood by business owners. Your employee is considered to have received a benefit if you pay or provide to him or her something that is personal in nature such as free use of property, goods or services. If the benefit is deemed taxable you must add the fair market value of the benefit to the employee’s income and tax accordingly.

One thing you can do to help with calculating payroll deductions is to use the CRA's Payroll Deductions Online Calculator. Instead of looking up deduction amounts on the provincial and territorial tables, you can simply enter your data into the calculator. Remember, though, that you assume the risk associated with using the CRA's calculator. If you end up remitting the wrong amount, you can't use the calculator as your excuse.

By taking care with these three CRA remittance pitfalls, you can avoid most of the headaches and frustrations encountered by business owners in the reporting area. Another alternative is to outsource payroll processing and let someone else take care of CRA remittance for you. When you're sure that your CRA remittance is handled correctly, you can face the details of your business confidently and irreproachably.

What Are You Leaving to Chance by Handling Payroll on Your Own

Topics: Payroll Service Provider, Canadian Payroll Deductions, Payroll Tax Calculations, Employee Payroll Deductions, Employment Standards Act, Best Payroll Calculator, MOL, ESA, ESA Compliant, Employee Payroll Tax

Three Top Reasons to Consider an Outsourced Payroll Service

Posted by Ray Gonder

|

Jun 27, 2013 9:00:00 AM

Three Top Reasons to Consider an Outsourced Payroll ServiceDepending on how many roles you play in your company, there could be dozens of reasons to outsource to a payroll service. Payroll is a job that never really ends, so handing it off to professionals allows you to spend more time on running and operating your business. When you are less concerned about government compliance and making sure everyone gets paid correctly and on time, you have less stress and can focus on the more important aspects of your work.

1. Save Time

From the moment you hire an employee, you have payroll responsibilities to manage. As part of the hiring process, you must collect information on your new employees and fill out tax forms in their behalf. At the end of each calendar year, you will fill out T4 forms and send year-end summaries to government reporting agencies. And that doesn't include your ongoing payroll responsibilities.

Each time you process payroll, you will calculate benefits and deductions from each employee's pay cheque, figure out payroll amounts based on tables published for the province or territory in which each employee reports for work, and send remittances to several different government agencies, each of which has its own due date throughout the month.

As you can guess, all of these tasks can take a great deal of your precious work time, time which could be much better spent in the service of managing and growing your company.

2. Reduce Stress

Not only is payroll time-consuming, but it can also be highly stressful. When you handle payroll yourself you must open and operate a payroll account with the Canada Revenue Agency (CRA). Of course, this involves time and energy setting up the account initially, but the real stress comes in your day-to-day operations. Each time you run payroll, you'll have to check contribution rates, maximums, and exemption charts for income taxes, CPP contributions, and EI premiums.

If employees have questions or if the rules and regulations change (which they inevitably do), you have to make adjustments, possibly mid-payroll cycle. If you're not an expert in Canadian payroll, these adjustments can be quite stressful, especially when you consider that if miscalculate, you could face fines.

3. Stay Compliant

And that leads us to a third reason to consider outsourcing payroll service: to stay compliant. When you take care of your payroll yourself, you run the risk of non-compliance. The laws, rules, and regulations surrounding payroll can be confusing, and to make matters worse, they change as laws and guidelines change. The following is an example of why it's important (and difficult) to stay compliant.

A recent minor change could make a big difference for your employees, but many Canadian employers simply don't know about the finer points of payroll tax deductions. If an employer chooses to pay for third-party short-term and long-term disability benefits, the insurance benefits will be taxable. This rule also applies if an employer funds their own disability program. If you choose to fund such a program, as the employer you will claim a deduction on line 229 of your T1 premiums, and you may do so for all premiums paid since 1968 that you haven't previously claimed.

Such fine points of payroll taxes are known only to those who are experts in the field or who spend an enormous amount of time keeping up on all the latest changes to payroll rules and regulations.

If you want to save time, reduce your stress, and stay compliant with Canada's payroll tax laws, it's time to consider outsourcing your payroll service. For more information, contact us at The Payroll Edge. We're ready to help.

What Are You Leaving to Chance by Handling Payroll on Your Own

Topics: Payroll Service Provider, Outsourced Payroll Service, Payroll Service, Best Payroll Calculator, payroll solution, Payroll Deductions, Dependable Payroll Service, Great Payroll Service Provider

How to Do Payroll in Canada

Posted by Ray Gonder

|

Jun 25, 2013 11:49:00 AM

How to do payroll in Canada 2If you were hoping that cutting cheques would be the sum total of your payroll responsibilities, you're in for a surprise. Canadian payroll is a bit more complicated than that. It can be challenging for US-based companies to adapt to payroll methods and guidelines in Canada, since the laws and regulations are quite different. It can also be difficult for new small businesses to get the hang of payroll responsibilities, especially when they're dealing with all the other details of running a small business. To help you get your bearings, we've put together a short (but not comprehensive) list of payroll tasks that you'll be responsible for.

Remittances

Calculating deductions and benefits contributions is time-consuming and tedious because you have to calculate each employee's individual deductions depending on their wages and province of work. Once you've done all of this paperwork, however, you're not done. You still need to remit the deductions and contributions to up to three separate government agencies, which each have their own due dates. If the remittances are not submitted properly, you could be fined.

Year-end Requirements

Your ongoing payroll responsibilities should be accurate throughout the year, but at the end of the year, you're also charged with reporting to tax authorities about the filings made by your company. These filings are from both the employee and employer perspective of taxation. You must also fill out T4 forms for each of your employees with an understanding of how to report certain things like commission and non-taxable earnings.

Employee Inquiries and Ongoing Legislative Changes

Payroll isn’t just paying someone an hourly wage x the hours they work. It’s much more complicated than that. There are taxable and non-taxable earnings, employer and employee benefit contributions, overtime, taxation maximums, vacation, and many, many more variations to consider. Add to that the fact that payroll legislation is a moving target and can change without notification. Managing payroll can be a confusing, time consuming task.

Your employees expect that they are to be paid correctly and on time. A paycheque is at the core of why they are working for you and is continuing incentive for them to do their very best to keep your company productive. Not being able to provide a regular, correct pay or to answer their payroll questions correctly can cause any employee to become disgruntled.

At The Payroll Edge, we can manage the above tasks for you and more. Our payroll experts are always on top of the latest tax-related legislations. They will field your employees' questions and guarantee that your payroll will be done accurately and on-time.

In addition, we offer premium human resource services as well, which can lighten your load considerably. These services include workplace injury claims management; consultation for employee review, conduct, termination, and layoff; and employment agreements, which protect your from legal action.

We know that you're an expert at what you do, but most likely, you're not a full-time payroll specialist. That's where we come in. We have over 25 years of experience with Canadian payroll. We know the ins and outs of the Canadian payroll, and we process over 5,000 pay cheques each week for companies in all Canadian provinces. If you'd like to spend more time focusing on your business and less time dealing with tedious paperwork, give us a call. There's real peace of mind that comes with knowing that your payroll is always taken care of by experts. Instead of staying up late the night before payroll is due every couple of weeks, you can continue to focus on doing what you do best: running and growing your company.

7 Signs It's Time to Outsource Payroll

Topics: Payroll Service Provider, Outsourced Payroll Service, Canadian Payroll, Payroll Tax Calculations, Canadian Payroll Service, Best Payroll Calculator, payroll solution, Payroll Deductions, Great Payroll Service Provider, Small Businesses Payroll, Payroll Expertise

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