168 /
Notes
(1) Payroll, in general, includes all payments, benefits and allowances included in computing
employment income under the Income Tax Act. Payroll may also be deemed to include
such payments made by associated employers.
(2) In addition to the Health Services Fund (HSF), Québec also levies a Manpower Training
Tax. Employers whose payroll exceeds $1 million must allot at least 1% of their payroll to
eligible training expenditures. Employers whose eligible training expenditures are lower
than the minimum required participation must make a contribution equal to the difference
between the two amounts. The employer must remit this contribution by the last day of
February of the following year.
Most Québec employers also have a requirement to contribute to the financing of the
Commission des normes du travail. For 2013, remuneration of up to $67,500 paid to
an employee is subject to a contribution rate of 0.08%. The employer must remit this
contribution by the last day of February in the following year.
(3) Employers with annual payroll over $2.5 million are subject to the 2.15% rate with no
exemption amount. Annual payroll of $1.25 million or less is exempt from tax. Annual
payroll between $1.25 million and $2.5 million is subject to a rate of 4.3% of the amount
in excess of $1.25 million.
(4) Employers with annual payroll over $5 million are subject to the 4.26% rate. Employers
are entitled to a gradual reduction in the contribution rate if their total annual payroll is
less than $5 million. The contribution rate for payroll between $1 million and $5 million is
calculated using the formula [2.31 + (0.39 × total payroll/$1 million)]. If annual payroll is
less than $1 million, the rate is 2.7%.
(5) Each province has specific eligibility criteria to obtain the exemption. In most cases,
the exemption must be prorated among associated corporations and certain corporate
partnerships.
Provincial Payroll and Health Fund Taxes
1
Manitoba Health
and Post-Secondary
Education Tax
Ontario Employer
Health Tax
Tax rate
2.15%
3
1.95%
Exempt remuneration
5
$1,250,000
3
$400,000
Instalment period
Monthly
7
Monthly
8
Annual filing deadline
March 31
March 15
Assessment period
6 years
4 years
Refund period
2 years
4 years
Appeal deadline
12
90 days
180 days
© 2013 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms
affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Current as of June 30, 2013