As an employer, you have to remit employer payroll deductions (usually) every month by the 15th of the following month.
Payroll deductions include the Canada Pension Plan (CPP) contributions, the Employment Insurance (EI) Premiums, and the Income Tax deduction for the employee, plus the employer’s share of the CPP Contributions (employee’s CPP x 1) plus the employer’s share of the EI premimums (employee’s EI x 1.4).
The deadline for December 2005 payroll deductions to be remitted to Canada Revenue Agency is Monday January 16, 2006 .. because the 15th is a Sunday, they move it forward one day.
So, if you think you might be short on your total 2005 remittances for payroll deductions – and keep in mind it will be after THIS payment that your annual T4 Summary of Remunation Paid report that you file with Canada Revenue Agency (due February 28, 2006) that the total remittance amount is based on. Penalties can range between 10% – 20% of any balance that you might be short.
Also, if you are an owner or shareholder … I generally recommend that when T4’s are issued .. there be enough income tax deducted .. so that when you file your personal income tax return, you will not be subject to the instalment requirements. Also, if cash flow is tight – and you can’t make enough income tax or source remittance and deduction, please don’t just try to get around that fact and call it a ‘management fee’ and issue a T4A with no tax or deductions … you would be better of to at least “cough up” the CPP contribution amount, both your share and the company share .. as a minimum.
Unfortunately, to pay at the bank you need the official PD7A form remittance stub at the bottom of the page. If you don’t have any available, head over to your local Canada Revenue Agency branch, and either drop it at the front counter or in the outside mail drop-off slot with a covering letter stating your payroll account and business number and that the extra payment is for 2005 calendar year.