Canada deductions

Submitted by on Wed, 2016-11-23 14:57

Watch for a notice from the Canada Revenue Agency and/or Revenu Quebec of any changes to your remittance frequency for 2017.  We’ve started seeing notices dated, November 1, 2016. Changes effect remittances for pay dates after January 1st, depend on your average monthly remittance amount 2 years prior and we want you to avoid penalties.

The CRA performs a calculation on your payroll deductions account, determining the average monthly witholding amount (AMWA). Typically they are looking at the AMWA 2 years prior unless there has been significant changes in the current year.  You can expect a letter if there has been a drastic change in your average monthly withholding amounts. 

Per the CRA's website: "If you have more that one payroll program account, such as RP0001 and RP0002 under your business number (BN) in the current year and the total average monthly withholding amount in the second preceding calendar year before the current calendar year of all the accounts was $25,000 or more, we consider all the accounts to be accelerated remitters." Please note, your remittance frequency is independent of your pay frequency.

It is very important that you watch for this letter and make the appropriate changes to your systems effective for your first pay date in 2017 to avoid any penalties for late payments.  If you are using a payroll service provider or tax filing service, make sure you supply them with a copy of this letter. Don't rely on them to ask you! If you are using, we will remind you to look for this letter and to supply us with a copy.  Here's a sample of what it looks like. . .CRA Remittance Letter