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Chapter 2
Payroll Fundamentals 2
| Term | Definition |
|---|---|
| Remittance payable to | Receiver General for Canada. |
| Remittance frequency | depends on its average monthly deduction amount for the second preceding calendar year. Defined by the Income Tax Act. |
| Statutory deductions for remittance are kept separate from | operating funds of the business and estate in liquidation, assignment, receivership, or bankruptcy. |
| Types of remitters (4) | 1. Quarterly 2. Regular 3. Accelerated threshold 1 4. Accelerated threshold 2 |
| Quarterly remitter (4) | 1. new employers with monthly remittance of less than $1000.00 2. perfect compliance Hx for payroll and GST/HST tax obligations 3. who have been notified they qualify for quarterly 4. employers who avg. monthly deduction amount is less than $3000.00 |
| Quarterly remitter payroll date/due no later than | Jan 1 - Mar 31, due Apr 15 Apr 1 - Jun 30, due Jul 15 Jul 1 - Sept 30, due Oct 15 Oct 1 - Dec 31, due Jan 15 |
| Regular remitter (2) | 1. employers who avg. monthly deduction amount is $3000.00 - $24,999.00 2. new employers who have not been notified by CRA they qualify for quarterly |
| Regular remitter payroll date/due no later than | 1st of the month - end of the month, due15th of following month |
| Accelerated threshold 1 | employers who avg. monthly deduction amount of $25,000.00 - $99,999.00 |
| Accelerated 1 payroll date/due no later than | 1st - 15th of the month, due 25th of the same month 16th to end of the month, due 10th of the following month |
| Accelerated threshold 2 | employers who avg. monthly deduction amount of $100,000.00 or more |
| Accelerated 2 payroll date/due no later than | All due 3 business days from last day ea. wk. *1st - 7th * 8th - 14th *15th - 21st *22nd - end of month due date falls on wknd or holiday - pay next business day |
| Remittance schedule | Quarterly, Regular, and Accelerated threshold 1 are due by a specified date based on the payroll payment date. Accelerated threshold 2 is due three (3) business days after the end of the weekly period, in which the payroll payment date falls. |
| Penalties | fail to remit or deduct required deductions = 10%, 20% for 2nd + late 3 business days = 3% late 4-5 business days = 5% late 6-7 business days = 7% late 8 + business days = 10% fail to comply; $1000.00 to $25,000.00 fines or prison 12 mon. |
| Remittance forms | PD7A - Quarterly & Regular PD7A (TM) - Accelerated 1 & 2 PD7A-RB; Remittance voucher - booklet of forms (Dec for next yr. ) |
| Remittance PD7A & PD7A (TM) forms (Pg1) | Company name and address (top left) Company payroll account No. and date issued (top right) General info (center) Company's current year remittance account balance (bottom) |
| Remittance PD7A & PD7A (TM) forms (Pg2) | Account summary; transaction details posted since last statement: - remittance account balances - arrears account balances - explanation of changes and other important information |
| Remittance PD7A & PD7A (TM) forms (Pg3) | How to remit? - lists ways to remit NIL remittance - if no remittance, section must be completed Remittance Voucher - complete when using voucher - end of period - gross payroll in period - No. of employees in last pay period - amount paid |
| Remittance PD7A & PD7A (TM) forms (Pg4) | More information: - get more payroll info - access and manage payroll account - register for direct deposit - get a statement in another format, for those with visual impairment |
| Remittance Voucher PD7A-RB (Part 1) | Receipt (top), making a payment at a financial institution, it will be date-stamped and returned. |
| Remittance Voucher PD7A-RB (Part 2) | For current remittance (bottom) - employer name, address, account No. - gross payroll for remitting period (round to nearest $) - end of remitting period - No. of employees in last pay period - amount paid (CPP, EI, Taxes) |
| Remittance methods (4) | 1. Electronic: using CRA's My Payment service 2. Financial institution: present CRA remittance form 3. Mail: payable to Receiver General, send bottom part of form, post-dated chq's acceptable 4. Service provider: give them copy of the notice from CRA |
| No Remittance | notify CRA by: 1. Provide a nil remittance in My Business Account or Represent a Client 2. TeleReply 3. Send remittance form or letter by mail |
| My Business Account | a secure online portal allowing one to interact with CRA (GST/HST, Payroll, Taxes, excise taxes and duties) |
| TeleReply | secure reporting service via phone to inform CRA of no payroll deductions remittance during a period. Meet requirements: 1. no employees subject to deductions 2. report a nil remittance 3. correct name and payroll program account No. sent from CRA |
Created by:
Moorebaier
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