When dealing with Canadian tax withholdings and remittances, mistakes can cost you a fortune in fines and back payments. US-based businesses are more likely to make mistakes, as they usually aren’t as familiar with Canadian tax laws. A Canadian Payroll Calculator can help you spot the most obvious errors, and make sure that you’re withholding enough taxes from your employees’ paychecks. Using a Canadian Payroll Calculator will help you determine how much to withhold from standard employees in typical situations. However, since you will probably have some non-standard employees working in atypical situations, a Canadian Payroll Calculator can’t replace the advice of a professional payroll service.
Not for Every Employee in Every Situation
To give accurate results, a Canadian Payroll Calculator must be using accurate information. Typically, they use a standard algorithm, designed to fit the majority of employees. However, given the complexity of Canadian tax laws, and the wide variety of employee and job designations, there is no calculator that can foresee every possible scenario. To account for this, the person using the calculator must have a strong understanding of the law, and how it’s applied in the real world. Without that understanding, the results from the calculator won’t necessarily apply to every employee in every situation.
Guidance, not Advice
A Canadian Payroll Calculator shouldn’t be used in place of advice from an experienced professional. A calculator should typically be used to double-check results that you’ve already determined using the withholdings information provided by the Canadian Revenue Agency. Using the rules they provide, you can determine the withholdings for an employee, and then check for any discrepancies using a Canadian Payroll Calculator. If there are discrepancies, you know that there’s a problem with either your calculations, or how your employee is classified.
Checking Your Work
Of course, identifying where any errors exist requires you to know and understand Canadian tax laws. Without that knowledge, it will be impossible to find anything other than basic arithmetical errors in your tax withholdings. You’ll be looking for a needle in a haystack—without knowing what a needle looks like. The kind of knowledge required to do advanced error checking only comes from constant experience with Canadian tax laws. Unless you have the time to devote to gaining that experience, you’ll always be at risk for unseen errors. Considering how much those errors can cost you, it’s probably not worth the risk.
Seek Professional Help
To avoid potential fines and back payments, you should consider using a Canadian payroll service. These experienced professionals deal with Canadian tax law every day. They also deal with the people who are applying those laws in the real world. That combined experience gives them a deep understanding of the intricacies of Canadian tax laws. They can quickly and accurately calculate all of your withholdings and remittances, with little risk of under- or over-payments. They can save you money immediately thanks to their speed and accuracy, and in the future by avoiding audits and associated costs.