Chapter 7

Question 1

Registration of Business (items required)

Answer 1

Canada Revenue Agency
Business Number
“RP” sub-account

Provincial Corporate Tax
Business Number

Provincial Health Tax if different

Workers’ Compensation

Question 2

Employer Matching Premiums and Contributions

Answer 2

Canada Revenue Agency
Canada Pension Plan Contributions (CPP)
Employment Insurance (EI)

Quebec Ministere du Revenu
Quebec Pension Plan (QPP)
Quebec Parental Insurance Plan (QPIP)
(EI rate is reduced because of QPIP plan)

Question 3

Québec Legislation

Answer 3

RQ, like the Canada Revenue Agency (CRA) is focused on ensuring compliance in the areas of filing, registration, remittance and reporting

Question 4

Revenu Québec (RQ) is the Québec government ministry responsible for

Answer 4

collection of income tax and consumption taxes

administration of the support-payment collection program, Programme de perception des pensions alimentaires (PPPA)

administration of taxation-related social programs

making recommendations to the government concerning tax policy and other fiscal programs

Question 5

Québec Pension Plan (QPP) Requirements:

Answer 5

The province of Québec administers its own pension program under the Act respecting the Québec Pension Plan.

Question 6

The QPP operates almost identically to the federal….

Answer 6

Canada Pension Plan (CPP). Its purpose is to provide basic financial protection to contributors and their families in the event of retirement, death or disability.

Question 7

In many ways, the requirements for QPP parallel those of CPP, with the following differences

Answer 7

QPP, instead of CPP, contributions are deducted from employees reporting for work at an office of an employer located in Québec, or from employees not required to report for work at an establishment of the employer in Québec, but paid from an employer in Québec
QPP contributions are remitted to Revenu Québec

Question 8

Employees and QPP

Answer 8

who are 70 years or older and who are in pensionable employment are still subject to QPP contributions on their pensionable earnings, even if they are in receipt of a CPP/QPP retirement pension from either the Canada or Québec Pension Plan

between age 55 and 70 can reduce their work hours and continue contributing to QPP as if their earnings had not been reduced. The phased retirement arrangement between the employee and employer must be approved by the Régie des rentes du Québec.

Question 9

Québec QPIP

Answer 9

The Québec Parental Insurance Plan (QPIP) came into effect on January 1, 2006.

This program marked the first time in history that a portion of the Employment Insurance (EI) premium had been transferred to a provincial jurisdiction.

Question 10

Similar to EI benefits, QPIP benefits …

Answer 10

are paid as a percentage of insurable earnings for a period of weeks, subject to an earnings cap.

Question 11

QPIP benefits differ from EI benefits in several ways

Answer 11

the maximum earnings cap is higher under the QPIP than under EI
the benefit rate is based on a higher percentage of insurable earnings
there is no waiting period to receive the first benefit payment
fathers can receive five weeks paternity leave in addition to the regular parental leave which may be taken by either parent or shared between them
claimants have the choice of receiving either higher benefits for a shorter period or lower benefits for a longer period

Question 12

All employees and employers have to pay ________ on insurable earnings and allowances from insurable employment

Answer 12

QPIP premiums

Question 13

Québec Income Tax

Answer 13

Québec is the only jurisdiction that collects its own provincial income tax. There are, therefore, two separate income tax deductions withheld from employees working in Québec — one federal and one provincial

The federal portion is remitted to, and administered by the Canada Revenue Agency (CRA)

The provincial portion is remitted to, and administered by, Revenu Québec (RQ)

Question 14

TD1 and TP-1015.3-V

Answer 14

In addition to the federal tax credits claimed on a federal TD1 form, Québec employees are entitled to provincial tax credits, which reduce the amount of income subject to Québec provincial income tax at source.

Question 15

Employees must complete a TP-1015.3-V:

Answer 15

when they start work with an employer
within 15 days after an event that will reduce the amounts claimed on a previously completed form
when they want an additional amount of Québec income tax withheld
when they want no income tax withheld from their remuneration for the year because their total employment income will be less than the basic tax credit for the year

Question 16

WSIB - Meredith Principles

5 common principles

Answer 16

No-Fault Compensation
Collective Liability
Security of Payment
Exclusive Jurisdiction
Independent Board

Question 17

Workers’ Compensation Insurance

Answer 17

Premiums are paid wholly by employers in each province or territory.

Each jurisdiction sets:
Industry classification
Rates
Payment process
Assessable earnings
Benefits to injured workers
Penalty or award systems for employer experience.

Question 18

Workers’ Compensation Insurance

Common across most jurisdictions:

Answer 18

Premiums based on individual earnings in year up to a maximum assessable amount.
Premiums due monthly based on estimated payroll
Penalties for under-estimation or late payment.
Rates based on industry classification of employer.

It is important to understand the rules for each jurisdiction of employment.

Question 19

Health Taxes

British Columbia

Answer 19

British Columbia have residents pay premiums.
Most employers are agencies that collect premiums through payroll deduction.
If premium is employer-paid then a non-cash taxable benefit is paid by employee.
Monthly Premiums –income $30,000+ (2015):
$72.00 for one person
$130.50 for a family of two people
$144.00 for a family of more than two.

Question 20

Health Taxes

Manitoba

Answer 20

Manitoba assess employers a health tax based on payroll.

Question 21

Health Taxes

Québec

Answer 21

Health services fund

the province of Québec funds their health care system through an employer tax levy
the health services fund is financed by employer contributions

Question 22

Health Taxes

Newfoundland and Labrador

Answer 22

Newfoundland and Labrador tax is 2% of annual payroll in excess of $1,200,000

Question 23

Health Taxes

Ontario

Answer 23

Combination of Employer and Employee Tax:

Ontario funds its health care using two methods

there is an employer tax, the Employer Health Tax (EHT) and there is also an employee tax, the Ontario Health Premium (OHIP)

Question 24

Ontario Employer Health Tax (EHT)

Answer 24

Most employers are exempt for the first $450,000 of payroll
The tax rate of 1.95% of payroll.
If an employer has payroll less than $600,000 than an annual return and payment is required by March 15th of the year following.
If the employer’s payroll is in excess of $600,000 then monthly instalments need to be made