12/08/2011

Important: must read if your organization is filing rl-1 forms in quebec (revised)

Employers who produce RL-1/2 forms using XML will be able to order an 8½ x 11” paper copy version on the RL-1/2 form when ordering forms from RQ.

Several employers who use XML to submit their RL-1 forms from Revenu Quebec do not use customized forms to process the employee’s paper copies of the RL-1 form.

Therefore in order to accommodate employer needs, RQ has developed an 8½ x 11 paper version of the RL-1.P/RL-2.P form that will include only the 2 copies required by the recipient that employers will be able to order directly from RQ.

As the government copy of the form will be submitted electronically to RQ when the employer files the form there will not be any need for a 3rd paper copy for employers to submit to the government.

The 2 copy forms will also provide the employer with enough space to report the footnotes at the center of the RL-1.P/RL-2.P slip.

Note:
Employers who do not file RL-1/2 forms electronically and file all of their RL-1/2 forms on paper will still be required to order the 8½ x 14 (3 copy paper version) that includes the government copy with the hard-coded addresses.

Important Note: Employers need to clearly specify when ordering paper RL-1/2 forms the type of form that they wish to order the 8 ½ x 11 (2 copy paper version for XML electronic submission) or the 8½ x 14 (3 part paper version of the RL-1/2 form).

Please note:
All employers can now order these forms online by utilizing the RQ’s online form order service. www.revenuquebec.ca/en/sepf/services/sgp_commande/default.aspx.

As the RL-1.P forms are only available in French, employers will be prompted to complete the French order form. To order the official French version of a publication or form, you have to use the online service  Commande de publications et de formulaires (French only) http://www.revenuquebec.ca/fr/sepf/services/sgp_commande/default.aspx .

Employers can select the actual forms from the listing that is available at this location http://www.revenuquebec.ca/fr/sepf/services/sgp_commande/default.aspx

The RQ  has also added pop-up advertisements when  a user comes to select les RL-1, RL-1.P RL-2 et RL-2.P forms as a part of the order service in order to ensure that employers order the correct format that will be applicable to their personal situation (8 x11 vs 8½ x14).

11/11/2011

Whether or not a retiring allowance is eligible depends on the years of service.

The eligible calculation is $2,000 per year or part-year of service prior to 1996.

There might be an additional $1,500 per year prior to 1989 if:

• the company did not have a registered pension plan (RPP) or deferred profit sharing plan (DPSP);
• the employee was not a member of an RPP or DPSP; or
• the employee was a member but is not 100% vested in the plan as at the date of termination (the $1,500 would be pro-rated for the unvested portion)

10/11/2011

Ontario is the only jurisdiction in Canada that requires employers to maintain an employee’s benefits for the notice period as required by law in the event of an employer initiated termination.

The legislation that addresses the issue of the employer’s requirement to maintain an employee’s benefits during the legislated notice period is addressed in the Ontario Employment Standards Act, 2000 and can be located in the following section of the legislation:

Pay instead of notice

61.  (1)  An employer may terminate the employment of an employee without notice or with less notice than is required under section 57 or 58 if the employer,

1. pays to the employee termination pay in a lump sum equal to the amount the employee would have been entitled to receive under section 60 had notice been given in accordance with that section; and
2. continues to make whatever benefit plan contributions would be required to be made in order to maintain the benefits to which the employee would have been entitled had he or she continued to be employed during the period of notice that he or she would otherwise have been entitled to receive.

More information may be obtained in the Ontario Employment Standards Act, 2000

09/01/2011

If an employer reimburses an employee directly for automobile costs such as gas, repairs and ,insurance that are associated with the employee’s own automobile, these reimbursements will be considered to be like a taxable auto allowance, and they will be subject to all statutory deductions, income tax ,C/QPP , EI and QPIP (if employed in Quebec).

If the employer makes the same payments on behalf of the employee to the applicable organization, then the payments will be subject to income tax and C/QPP only as the amounts will not be deemed as cash income to the employee.

In both instances these amounts should be reported in Box 14 and Code 40 of the T4 as well as Box A and L of the RL-1 (if employed in Quebec)

08/15/2011

When calculating the eligible portion of a retiring allowance, employers may also have to include years of service with a previous employer in either of the following scenarios:

• the business was acquired or continued by the employer (merger or acquisition); or
• the employer’s pension plan recognizes any part of the years of service with a former employer (common with public pension plans).

07/28/2011

The New Brunswick government has recently announced its intention to postpone the minimum wage increase from $9.50 to $10.00 from September 1st 2011 to April 1, 2012.

As a result the current minimum wage of $9.50 will remain in effect until the revised date of April 1, 2012

Employers may access a copy of the News Release at the New Brunswick Government website.

07/18/2011

When employers make payments for retiring allowances in installments the lump sum tax rate must be based on the total of all payments made in the year, and not on each individual payment.

For example, you are paying an employee a retiring allowance in installments of $5,000 per month for 4 months in the same calendar year. The tax rate for one payment of $5,000 if it were the only payment being made would be 10%. Due to the fact that the employee is receiving a total of $20,000 in the same year the federal tax rate that must be used for each $5,000 payment is 30%.

If this were a Quebec employee the federal tax rate would be set at 15% and the Quebec tax rate at 20%, for this particular scenario.

06/24/2011

Employers often make various payments to existing employees that fall outside of the regular pay period processing cycle. These payments could consist of bonuses, irregular commissions, banked overtime, etc. Additional payments such as these should be taxed using the bonus taxation method.

The bonus taxation method is illustrated in Chapter 6 of the T4001 Employers' Guide - Payroll Deductions and Remittances. Employers may easily obtain a copy from CRA’s website at T4001

06/02/2011

Alberta announces changes to the minimum wage that will come into effect on September 1, 2011

The Alberta government has just announced the following changes to the minimum wage that will come into effect on September 1, 2011. The general minimum wage will increase from $8.80 to $9.40 per hour.

In addition a new minimum wage will be also be introduced for liquor servers who receive tips. This new minimum wage will be set at $9.05 and will also come into effect on September 1st 2011.

Employers may access a copy of the News Release announcing these changes at the government website. http://alberta.ca/acn/201106/305954CB2E5ED-A0EB-319C-27D6B1B404F212DF.html

05/24/2011

If an employer reimburses an employee directly for automobile costs such as gas, repairs and ,insurance that are associated with the employee’s own automobile,  these reimbursements will be considered  to be like a taxable auto allowance, and they will be subject to all  statutory deductions, federal and provincial income tax ,C/QPP, EI and QPIP (QPIP and QPP if employed in Quebec)

If the employer makes the same payments on behalf of the employee to the applicable organization, then the payments will be subject to federal and provincial income tax and C/QPP only as the amounts will not be deemed as cash income to the employee.

In both instances these amounts should be reported in Box 14 and Code 40 of the T4 as well as Box A and L of the RL-1 (RL-1 if employed in Quebec)

05/10/2011

The maximum CPP/QPP pensionable as well as EI and QPIP insurable earnings apply to each job the employee holds with different employers (different business numbers).

If an employee leaves one employer during the year to start work with another employer, the
new employer also has to deduct CPP/QPP contributions as well as EI and QPIP premiums without taking into account what was paid by the previous employer. This is the case even if the employee has paid the maximum contribution and premium amounts during the previous employment. Any overpayments will be refunded to employees when they file their income tax and benefit returns.

Employers are not entitled to a refund.

04/01/2011

If you receive a Notice of Assessment or if you discover that you have under deducted C/QPP contributions, EI or QPIP premiums you can recover the employee's contributions from later payments to the employee. The deductions can be equal to, but not more than, the amount you should have deducted from each payment.

However, you cannot recovera contribution amount  that has been outstanding for more than 12 months.

The employer's share is your responsibility.

If you should have made a deduction in a previous year and you recover it through a deduction in the current year, do not report the recovered amount on the current year's T4  or RL-1 slip. Instead, amend the previous year's T4 or RL-1.

The recovered amount does not affect the current year-to-date C/QPP contributions, EI or QPIP premiums.

03/18/2011

British Columbia Government announces increase to the minimum wage

The British Columbia government has just announced that the minimum wage will increase in three stages by May 1, 2012. This minimum wage increase is the first in that province since November 1, 2001 when the minimum wage was set at $8.00. Once the increases have been fully implemented by May 1, 2012, the minimum wage will be $10.25

The increases will be phased in as follows:

Training wage to be eliminated effective May 1 2011

The government also announced that the training wage of $6.00 per hour will also be repealed as of May 1 2011 and all employees who were paid the training wage prior to May 1 2011 will need to be paid at the general minimum wage rate effective May 1 2011.

New minimum wage for liquor servers

The government has also introduced a new minimum wage for employees who serve liquor directly to customers. The minimum wages for alcohol servers will consist of the following:

Employers may access a copy of the News Release announcing these changes at the government website.

02/25/2011

Important Note: February 28th is an important deadline for many reasons

We are all aware that February 28th is the filing deadline for the production of T4’s and RL-1’s. It is also the filing deadline for Workers Compensation Annual Returns in several jurisdictions across Canada. A complete listing of Workers Compensation filing deadlines is listed in our 2011 Rates Sheet.

Note: You must be logged in with your User ID and Password to access this area of our website

02/23/2011

If your pension plan is a defined contribution plan the PA amount reported in box 52 of the T4 will be comprised of the sum total both the employee and employer portions. The employee deduction amounts will always be reported in box 20 of the T4 and box D of the RL-1. There are no PA reporting requirements for Revenue Quebec.

More specific information on Pension Adjustments can be found in the T4084 Pension Adjustment Guide available at: http://www.cra-arc.gc.ca/E/pub/tg/t4084/

02/07/2011

Important Reminder: Year-End reporting as it relates to Workers Compensation benefits

Employers who advance Workers Compensation (WC) benefits (typically a percentage of the employee’s net or gross pay, depending on the jurisdiction) do not declare these advances on the employee’s year-end slip, nor are the WC reimbursements reported on the T4 or RL-1 slip.

It is only when the employer’s policy or collective agreement provides the employee to receive a continuation of salary (typically 100% of the employee’s gross pay less statutory deductions, or paid out of the employee’s sick bank) that WC reimbursements to the employer are reported in Code 77 of the T4 in the year in which the WC reimbursements are received.

Quebec employers who provide salary continuance are also required to:

• reduce Box A by the amount of the WC reimbursement if this reimbursement was for the current year; or
• record the amount of the WC reimbursement as a footnote at the center of the RL-1 slip: “Reimbursement of Salary CSST $_____” if the reimbursement is related to a previous year.

01/21/2011

Reminder: Important changes to T4 for 2010 reporting year

The CRA has made some important changes to the T4 that will impact most employers. The most significant change is that the reporting of retiring allowances will be moved from the T4A to the “Other information” area of the T4.

In order to accommodate these changes; the following new codes have been added for use in the “Other information” area of the T4 which will be in effect for all slips processed on or after January 1, 2011 for payments in the 2010 calendar year and beyond.

Code 66 – Eligible retiring allowances
Code 67 – Non-eligible retiring allowances
Code 68 – Status Indian (exempt income) eligible retiring allowances
Code 69 – Status Indian (exempt income) non-eligible retiring allowances

Please note: The amounts reported from Code 66 to Code 69 (inclusive) must not be included in Boxes 14, 24, 26 or 55 of the T4. Even though retiring allowances are now reported on the T4 slip, these payments are still not considered pensionable for C/QPP or insurable for EI and QPIP. Any income taxes associated with these codes will also be included Box 22 of the T4.

Code 86 – Security options election

In addition to the above codes, the CRA has also added code 86 to the “Other information” area of the T4. This code will to be used by employers to report security options cash-outs where the employer has opted out of claiming the security option deduction as an expense.

If the employer elects this option, the taxable benefit will be reported as follows:

The full amount of the security benefit will be reported in Box 14, Code 38 and Code 86 of the T4. The 50% deduction (if applicable) will also be reported in Code 39 or 41 of the T4.

More information in relation to this and other important upcoming changes will be addressed in greater detail in our upcoming 2010 Year-end and New Year Requirements seminars to be held at various locations across Canada later in the year.

Please refer to the Calendar of Events that is posted at the CPA’s website for additional details.