This is an article for Payroll by Wave in Canada.
Paying payroll taxes to the government, known as payroll remittances, can get confusing. Not to worry, though, we're here to help!
When you registered your business with the CRA (see more on Getting your CRA Business Number) they would have sent you more information about when to remit (your remittance frequency and type.)
When are my remittances due?
Your remittances are due based on the type of remitter and your cheque date:
New or Regular (Monthly in Wave) - This is the most common remitter for Wave customers.
If you are a new employer, or your average monthly withholding amount (AMWA) two years ago was less than $15,000, you are a regular remitter. In Wave, select Monthly as your remittance frequency.
The CRA needs to receive your remittance before the 15th day of the month after you made deductions.
For example, if you paid your employees (the cheque date) on January 2nd, you would need to ensure the CRA receives your remittances February 15th or earlier.
See more on being a New Remitter.
Threshold 1 - Also known as an Accelerated remitter. You are Threshold 1 if your business had a total average monthly withholding amount (AMWA) two years ago was in the range of $15,000 to $49,999.99.
- If your cheque date is before 16th, your remittance is due by the 25th day of the same month. For example, if your employees are paid January 5th, your remittance is due the January 25th.
- If your cheque date is on the 16th or after, your remittance is due by the 10th day of the next month. For example, if your employees are paid January 17th, your remittance is due February 10th.
See more on being a Threshold 1 Accelerated remitter.
Threshold 2 - Also known as an Accelerated remitter. You are Threshold 2 if your business had a total average monthly withholding amount (AMWA) two years ago of $50,000 or more.
If you are Threshold 2, please Contact Us to request a phone call with our payroll experts.
If Wave handles my remittances for me, when are the amounts withdrawn from my account?
Wave withdraws the amount needed for your remittance when your payroll run has been processed (usually 1 day before the payroll has been processed.) We hold this money and remit it to the government on time based on your business remitter type (mentioned in the above section.)
Let's say your direct deposit is already fully set up and, and your employee's payday is November 1st. In order for your employee to get paid on time, you need to run your payroll on October 28th before 5:30pm EST. See how it's 4 days in advance and before the cut-off time.
Here is a breakdown of what happens:
- Monday - request to take out money from the employer's account is sent to the employer's bank.
- Tuesday - money is taken out of the employer's bank account. This includes the remittance amount.
- Wednesday - waiting for confirmation that the employer actually had the money and it's been taken out.
- Thursday - money is sent to the employee bank accounts.
- Friday - employees receive the money in their accounts. Payday!
Can I handle my own remittances? Does that change my remittance dates?
You certainly can handle them yourself and no, it does not change when your remittances are due. You will still need to know what type of remitter you are and when your remittances are due.
The Taxes tab under the main Payroll menu will provide the information you need to fill out your CRA Remittances Voucher.
- Canada Revenue Agency - Remitting payroll deductions
- Setting up payroll direct deposit for the first time
- Set up Wave to remit taxes to the CRA on your behalf
Updated on January 3rd, 2014