Canadian Payroll Processing

Every Canadian payroll processing engagement begins with meticulous calculation of employee compensation using the most current tax rates, deduction tables, and CRA regulations. We calculate gross earnings based on each employee's compensation structure—hourly wages with accurate overtime calculation at provincial rates, salaried compensation with proper annualization for partial pay periods, commission payments with appropriate tax withholding, and bonuses and other compensation elements treated according to CRA requirements. Our systems automatically account for complex situations like retroactive pay increases, back pay, and severance payments, ensuring accurate tax treatment for all compensation types.

Statutory deductions represent the critical compliance component of our payroll processing. We calculate CPP deductions based on the current year's maximum pensionable earnings and contribution rate, ensuring employees' CPP doesn't exceed the yearly maximum and that employer CPP contributions are calculated correctly. EI contributions are calculated using the current insurable earnings maximum and premium rate, applying the reduced rate for eligible employers who qualify through the small business program. Federal income tax withholding uses the appropriate tax brackets based on the employee's province of employment, incorporating personal tax credits such as the basic personal amount, Canada employment amount, and other applicable credits.

Provincial tax handling distinguishes our comprehensive payroll services. For employees working in provinces outside we calculate provincial income tax using the correct provincial tax tables and credits. For we calculate QPP contributions instead of CPP, QPIP premiums instead of EI, and provincial tax through Impôt provincial. We also manage employer health tax and payroll taxes in other provinces where applicable, and ensure all provincial variations in tax treatment are applied correctly. This provincial expertise prevents the common errors that occur when businesses apply one-size-fits-all calculations across all employees.

CRA remittance represents one of the most critical compliance obligations for Canadian employers, and our comprehensive payroll processing includes complete management of all remittance requirements, deadlines, and calculations. CRA classifies employers as regular remitters, quarterly remitters, or monthly remitters based on average monthly withholding amounts, and each classification carries different remittance frequencies and deadlines. We ensure your business is correctly classified, track all upcoming remittance dates, and calculate the precise amounts due for each remittance period based on total CPP, EI, and income tax withheld during that period.

Our Canadian payroll services include proactive deadline management that prevents costly CRA penalties and interest. Regular remitters must remit by the 15th day of the following month, while quarterly remitters have different deadlines that we track meticulously. We generate detailed remittance summaries showing the breakdown of amounts remitted: employee CPP, employer CPP, employee EI, employer EI, federal income tax, and provincial income tax where applicable. Each remittance is coded with proper references including your business number, remittance period, and remittance type code, ensuring CRA applies the payment correctly to your payroll account.

Beyond regular remittances, our comprehensive Canadian payroll processing manages CRA's reporting requirements throughout the year. We assist with completing PD7A remittance forms accurately, maintain detailed records of all remittances in case CRA inquiries arise, and prepare year-end summaries of total remittances that must match T4 totals. In the event of CRA payroll audits or assessments, we provide complete documentation supporting every calculation and remittance, representing your interests and resolving discrepancies efficiently. This comprehensive remittance management provides peace of mind that all payroll tax obligations are met accurately and on time.

Year-end T4 slips and T4A slips preparation represents the culmination of annual payroll processing and a critical component of CRA compliance that affects both employers and employees. T4 slips document employment income and must be issued to every employee who received CPP-eligible earnings during the year, regardless of whether they worked the entire year or only for a short period. T4A slips document other types of income that require CRA reporting, such as payments to contractors, pension income, and certain types of self-employment income. Our payroll processing includes complete year-end management of these essential documents.

Before generating year-end slips, our comprehensive Canadian payroll services perform detailed reconciliation to ensure accuracy. We verify that total CPP contributions for each employee don't exceed the yearly maximum, that EI premiums respect both the yearly maximum and any applicable rate reductions, and that income tax withholding aligns with what employees ultimately owe based on their complete tax situations. We review each employee's earnings, deductions, and contributions for consistency and accuracy, catching and correcting any discrepancies before slips are generated. This thorough review prevents the need for amended T4 slips and ensures employees receive accurate tax information for their personal tax returns.

We prepare T4 slips and T4A slips using CRA-approved electronic format and file employee information electronically to CRA by the February 28th deadline. Each slip includes all required fields completed accurately: employee personal information including name, address, and social insurance number; total employment income; CPP contributions; EI premiums; income tax withheld; pension and superannuation amounts; union dues; charitable donations; and all other required income and deduction codes. Our Canadian payroll processing services include distribution of employee copies by the end of February, ensuring compliance with CRA's distribution deadline and providing employees with the documents they need to complete their personal tax returns on time.

Record of Employment (ROE) processing is a mandatory obligation for Canadian employers that our comprehensive payroll services manage completely. Service Canada requires ROEs whenever an employee experiences an interruption of earnings, including termination or layoff, resignation or quitting, leaves of absence exceeding 7 days, or significant reductions in hours. ROEs are the primary document Service Canada uses to determine eligibility for Employment Insurance benefits, making accurate and timely ROE submission critical for employees who may need to claim EI and for employers seeking to ensure proper claim processing.

Our Canadian payroll processing includes both electronic ROE submission through Service Canada's ROE Web system and preparation of paper ROEs when required. We calculate all ROE fields accurately, including the employee's earnings during the relevant reference period, insurable hours worked, insurable earnings, and the specific reason code for issuing the ROE using Service Canada's standardized codes. We handle complex situations such as leaves of absence (maternity, parental, sickness), wage garnishments affecting net pay, and other circumstances that require special coding on the ROE. For businesses experiencing layoffs or closures, we efficiently manage bulk ROE submissions for multiple employees simultaneously.

ROE management extends beyond initial submission within our comprehensive Canadian payroll services. We correct ROEs when Service Canada identifies errors or discrepancies, process amended ROEs when corrections are needed due to changed circumstances, and respond promptly to ROE-related inquiries from both employees and Service Canada. We maintain complete records of all ROEs issued for each employee, providing documentation that supports your business's compliance should CRA or Service Canada review your payroll practices. This comprehensive ROE management protects employees by ensuring they receive proper EI consideration when needed and protects employers by preventing improper EI claims and ensuring documentation of all employment interruptions.

Multi-provincial payroll management presents unique challenges that our team has mastered through extensive experience serving Canadian businesses with employees across multiple jurisdictions. Each province and territory maintains distinct tax rates, provincial tax tables, and unique regulations that must be applied correctly based on each employee's province of employment—not necessarily their province of residence. Our payroll processing systems are configured to handle this complexity seamlessly, automatically applying the correct provincial tax rates, credits, and deductions for each employee based on where they perform work.

For businesses with employees in multiple provinces, employer health tax represents another provincial consideration in our comprehensive payroll processing. Ontario imposes EHT on employers with annual payroll exceeding $5 million, while other provinces have similar but distinct payroll tax structures with different thresholds and rates. Our payroll services track payroll totals by province, monitor EHT thresholds across jurisdictions, ensure proper registration with provincial tax authorities where required, and remit provincial payroll taxes on appropriate schedules. This detailed multi-jurisdictional management prevents costly errors, ensures full compliance across all operating provinces, and provides your business with consolidated payroll reporting that shows the complete picture regardless of geographic spread.

Workers' Compensation management is an essential component of comprehensive payroll processing that varies significantly by province. Each province maintains its own Workers' Compensation Board (WCB) with distinct registration requirements, premium calculation methods, and reporting obligations. Ontario's WSIB (Workplace Safety and Insurance Board), British Columbia's WorkSafeBC, Alberta's WCB Alberta,'s CNESST each operate under entirely different systems with different premium structures, rate classifications, and reporting requirements. Our Canadian payroll processing includes expertise across all provincial WCBs, ensuring your business is properly registered where required and pays accurate premiums.

For businesses operating in multiple provinces, Workers' Compensation becomes significantly more complex. Each WCB classifies business activities into rate groups with different premium rates, and a business operating in multiple provinces may be classified differently in each jurisdiction based on the predominant activities in each province. Our comprehensive Canadian payroll services track payroll by WCB rate category when a business operates in multiple classifications, ensuring accurate premium allocation across different activities. We manage the annual payroll reports each WCB requires, reconciling total payroll reported throughout the year to ensure premiums are based on correct amounts and claiming any applicable credits or refunds.

Beyond premium calculations and reporting, our Canadian payroll processing includes Workers' Compensation support in the event of workplace injuries. When employees are injured on the job, we provide the payroll documentation WCBs require for claims processing, including employee earnings at the time of injury, any changes in compensation status, and return-to-work information. We handle the special reporting WCBs require when workplace injuries result in wage loss, ensuring your business maintains compliance with accident reporting requirements. This comprehensive Workers' Compensation management ensures your business maintains compliance with provincial requirements, pays appropriate premiums without overpaying through experience-based reductions, and receives proper support for workplace injury claims.