An Educational Service of CanPay Software Inc.
February 2004

Contents:

• Welcome
• Upcoming Events
• What's New
• GrandMaster Update


Featured Article:

CPP/QPP, WCB and EI Rates for 2004
Tip of the Month:

Filing T4 Returns

NOTE: This archive references other sites on the World Wide Web. From time to time, an article's link may be moved or deleted from the host site. If you encounter an out-of-date link, please e-mail the payrollnews@canpay.com.

 

Welcome!

February 2004- Welcome to the latest edition of The Payroll News. As always, please feel free to forward this newsletter to your friends and associates who are interested in keeping up with the latest changes in the Payroll industry. Or better yet, subscribe them for free using the Tell Others About Us link.

Upcoming Events

Event Description

Payroll Information Seminars for New Employers
Barrie, Ontario
Brandon, Manitoba
Brooks, Alberta
London, Ontario
Medicine Hat, Alberta
Ottawa, Ontario

Scarborough, Ontario
Toronto, Ontario

Toronto (Centre), Ontario
Winnipeg, Manitoba

This seminar outlines employment relationships to help you determine whether a worker is an employee or self-employed. Other topics include: source deductions, employer responsibilities, assessment and penalties, determining and calculating deductions for Canada Pension Plan contributions, employment insurance premiums and how to maintain proper payroll records.
Small business information seminar
Barrie, Ontario
Brandon, Manitoba
Calgary, Alberta

Edmonton, Alberta
Ottawa, Ontario
Red Deer , Alberta

Scarborough , Ontario
Toronto, Ontario
Winnipeg, Manitoba
These seminars are designed for those who have just started or are about to start a small business. Income Tax and Payroll are two of the subjects discussed along with the following topics: how to keep books and records, types of income to report, expenses to claim, filing requirements and rights and obligations.
T4/T4A year-end preparation seminar
Brandon, Manitoba
Edmonton, Alberta
Winnipeg, Manitoba

This seminar provides general information to help you meet your year-end reporting requirements. Topics include: general discussions about the T4 and T4A forms, detailed T4 slip preparation, suggestions for making a year-end easier to manage, importance of a social insurance number (SIN), pensionable and insurable earnings review (PIER) and penalties for noncompliance.
Level 1 - Basic Introduction to Payroll
Level 2 -
Administering the Payroll Function
Level 3 -
Managing the Complexities of Payroll
Carswell offers dynamic, interactive sessions provided by instructors that have practical payroll and research capabilities. Courses are structured as interactive workshops, not "lecture-style" seminars. Examine real life case studies, focus on the specifics and gain practical knowledge you can put to work right away.


What's New in Canadian Payroll

Listed here are recent changes in legislation on Federal and Provincial levels that may impact your payroll calculations. Please view the following list for changes that affect your region.

FEDERAL:

January, 2004 - New EI Compassionate Care Benefit - Starting January 4, 2004, Compassionate Care Benefits will be available to EI-eligible people who need to be away from work temporarily to provide care or support to a family member who is seriously ill with a significant risk of death. (Full Story - 3000 Words)

January 26, 2004 - Launch of Summer Work Experience 2004 - Human Resources and Skills Development Minister Joseph Volpe today launched Summer Work Experience 2004, formerly known as Student Summer Job Action. Summer Work Experience is part of the Government of Canada's commitment to help Canadian students find summer jobs that will help them develop the skills, knowledge and work experience they need to prepare for and participate in Canada's rapidly evolving labour market. (Full Story - 1600 Words)

January 27, 2004 - Statement on Canada's maternity and parental benefits - In March 2002, the Government of Quebec referred four questions to the Quebec Court of Appeal to determine the constitutional validity of the Government of Canada's maternity and parental benefits scheme. The Court has rendered its decision today. (Full Story - 122 Words)

January 23, 2004 - Labour Ministers Meet, discuss occupational health and safety - A meeting of federal, provincial and territorial ministers responsible for labour today was held today in Banff, Alberta. The meeting focused on occupational health and safety, and international trade and labour issues. "Workplace injuries affect workers, employers, and families across Canada," said Alberta Human Resources and Employment Minister Clint Dunford. "Sharing best practices at a meeting like this will help us continue to promote and ensure safe workplaces." (Full Story - 730 Words)

Alberta:

December 30, 2003 - Increased personal exemption amounts keep more money in Albertans' pockets - Albertans will save about $150 million in 2004 as the government increases personal tax credits. Alberta's basic personal amount, spousal amount, and eligible dependent amount will all rise to $14,337 for 2004, up from $13,525 in 2003. The six per cent increase in the basic amounts reflects Alberta's move to index personal tax credits for inflation. (Full Story - 380 Words)

January, 2004 - Annual Return time for WCB - At the beginning of each year employers complete an "Annual Return"form. This form details the actual earnings paid to workers for the previous year along with an estimate of what will be paid out in insurable earnings for the current year. To coordinate the reporting requirements with Revenue Canada’s T4 deadlines the WCB accepts the Annual Return up to the last day of February. (Full Story - 362 Words)

January, 2004 - Preventing Workplace Violence Seminar - The Occupational Health and Safety Act states employers must do everything they can to protect their workers. As such, the WCB-Alberta is offering a free seminar for employers who are interested in developing a workplace violence prevention program. For more information or to register for the Workplace Violence Prevention seminar, please contact the WCB Corporate Security team at (780) 498-4990 (Northern Alberta) or (403) 517-6003 (Southern Alberta). (Full Story - 230 Words)

Bristish Columbia:

January 20, 2004 - WCB introduces incentives to assist successful return to work - B.C. employers in the pulp and paper industry will soon have a strong incentive to assist injured employees in returning to work. Employers that meet specified standards in disability management will now be rewarded with discounts in their workers' compensation premium rates. The three-year pilot project was developed in collaboration with the Workers' Compensation Board, employers and unions. (Full Story - 575 Words)

January, 2004 - WCB announces 2004 base rates - The 2004 base rates reflect an aggregate base rate of $2.059 per $100 of employer's assessable payroll, virtually unchanged from the 2003 rate of $2.053. The negligible increase is required to cover projected costs in 2004 and beyond. (Full Story - 300 Words)

January 22, 2004 - Public hearing on proposed amendments to occupational health and safety requirements - The Workers' Compensation Board will hold a public hearing to seek comment from the public about proposed amendments to B.C.'s occupational health and safety regulations. The proposed amendments are part of the WCB's ongoing review process to ensure regulations are current and provide regulatory protection to workers from workplace injury and occupational disease. (Full Story - 400 Words)

Manitoba:

January 5, 2004 - New job protection measures take effect - Manitoba’s new legislation to provide unpaid compassionate care leave and to improve job protection for workers returning from maternity or parental leave, or from caring for a family member at risk of death, took effect yesterday. "The new legislation reduces the vulnerability of Manitobans who choose to exercise their maternity and parental leave options," said Labour and Immigration Minister Nancy Allan. "At the same time, our introduction of unpaid compassionate care leave offers a new range of options for Manitobans responding to major family health situations." (Full Story - 360 Words)

January 19, 2004 - WCB Unveils Comprehensive Report on Workplace Injuries - The Workers Compensation Board launched its latest SAFE Work campaign today, in conjunction with the unveiling of the most comprehensive workplace injury statistics report ever published in Manitoba. The Joint Injury and Illness Statistics Report, a component of the Province of Manitoba’s Workplace Safety and Health Prevention Strategy, represents the first time such an extensive report has been released for Manitoba. It contains three main areas: injury rates, workplace fatalities, and characteristics of injured workers and accepted claims. The report will be the authoritative document on all such statistics in the province. (Full Story - 800 Words)

New Brunswick:

January 23, 2004 - Employers have until March 1 to apply for SEED Program - New Brunswick employers planning to hire a student for summer employment have until March 1 to apply for funding through the Student Employment and Experience Development (SEED) program. "The SEED program is an excellent initiative that benefits both students and employers," Training and Employment Development Minister Margaret-Ann Blaney said. "We get a tremendous response to this program. That's why we encourage employers to submit their applications early." (Full Story - 400 Words)

January 22, 2004 - More workers to benefit from specialized training initiatives - Two initiatives totalling more than $40,000 will provide specialized training for 18 New Brunswickers, thanks to a partnership between the Department of Training and Employment Development and the New Brunswick Regional Council of Carpenters, Millwrights and Allied Workers. "With these initiatives, more workers will attain the right skills that will help them secure long-term employment," Training and Employment Development Minister Margaret-Ann Blaney said. (Full Story - 330 Words)

January 9, 2004 - Unemployment rate drops to 9.9 per cent - The unemployment rate dropped to 9.9 per cent in December 2003, and New Brunswick's labour force annual averages have remained steady over last year, Training and Employment Development Minister Margaret-Ann Blaney reported today. "I was pleased to see that our unemployment rate had dropped into the single digits in December but we must continue to monitor these figures on a long-term basis," Blaney said. (Full Story - 320 Words)

January 28, 2004 - Forty-four summer mentorship positions open for female students - Young women looking to break into careers that have traditionally been male-dominated can get a head start this summer through the Summer Mentorship Program for Female Students. The program offers up to 44 positions for university students to be paired with civil servants working either in a field that does not traditionally have large numbers of women, or in senior management. The program is co-coordinated by the Office of Human Resources, with funding provided by the Department of Training and Employment Development. The program has received an exemption from the New Brunswick Human Rights Commission to permit a female-only uptake. (Full Story - 300 Words)

Newfoundland and Labrador:

January 27, 2004 - Commission proposes to give employers more control over their insurance costs - The WHSCC is planning to change the way it calculates the premiums employers pay to insure their workers against workplace accidents and injuries. The new system, known as PRIME, will give employers more control over their annual insurance costs. Through PRIME, employers will be given a financial incentive to reduce accidents, foster safe and healthy workplaces and get injured workers quickly and safely back to work. (Full Story - 460 Words)

January 12, 2004 - Agreements signed with health care providers - The Workplace Health, Safety and Compensation Commission is pleased to announce the signing of agreements with two of its health care partners – chiropractors and occupational rehabilitation providers. These agreements are a first for the Commission with the groups involved and signal a renewed partnership for delivering services to injured workers. In 2002, the Commission signed a similar agreement with the Newfoundland and Labrador Medical Association (NLMA). (Full Story - 436 Words)

January 14, 2004 - Workers Compensation Premiums on the whole are starting to decline - According to recent statistics from the WHSCC, workplace accidents in the province’s construction industry are becoming less frequent and employer’s workers compensation premiums on the whole are starting to decline. Ron Croke, Chief Executive Officer of the Newfoundland and Labrador Construction Safety Association (NLCSA), believes that these positive results are a direct outcome of employers and employees adopting a strong focus on accident prevention and a concerted effort towards providing a safer and healthier workplace. (Full Story - 530 Words)

Nova Scotia:

January 9, 2004 - More Nova Scotians Secure New Jobs - More Nova Scotians than ever have found jobs under the province's economic growth strategy, Premier John Hamm said today, Jan. 9. According to today's monthly employment report from Statistics Canada, more than 7,000 new jobs were created in Nova Scotia during the last 12 months. The total number of working Nova Scotians now stands at 439,500 for the month of December 2003 - an all-time high. (Full Story - 400 Words)

January, 2004 - Introductory Workshop For New Business - The "Minding Your Business Workshop" offers a chance for business people to meet and ask questions of experts from the WCB, OH&S and CRA all in one location in one day. Participants will get tools and tips on reducing workers' compensation premiums, collecting, remitting and reporting payroll deductions, registering for the HST, the risks of participating in the underground economy, ensuring your firm is meeting its OH&S responsibilities and more. (Full Story - 211 Words)

January 28, 2003 - Youth Conservation Corps Accepting Applications - The Nova Scotia Department of Environment and Labour is looking for proposals that will help give young people work experience on environmentally friendly projects in communities across the province. The youth conservation corps program will pay 75 per cent of the labour cost of each crew and provide administration, recruiting, and payroll services. It will also train workers in emergency first aid, occupational health and safety, workplace hazardous materials information system, and basic environmental issues. (Full Story - 385 Words)

Prince Edward Island:

January 7, 2004 - Minister announces appointments to WCB - Elmer MacFadyen, Minister of Community and Cultural Affairs and Minister responsible for the Workers Compensation Act, announced today, appointments to the Workers Compensation Board. The board will increase to seven members from the current five members with equal representation from employees and employers. (Full Story - 240 Words)

Ontario:

January 28, 2004 - Ontario residents can now file for EI online - As of January 28, 2004, clients living in the Ontario province, who file their report using our automated telephone reporting service (Teledec), can now use the new EI reporting service on-line. (Full Story - 1270 Words)

January 26, 2004 - McGuinty government set to raise minimum wage - On February 1, 2004, Ontario's general minimum wage will rise to $7.15 per hour, from the previous rate of $6.85 per hour. The general minimum wage will increase annually until it reaches $8 per hour on February 1, 2007. In 2000, there were approximately 191,000 minimum wage earners in Ontario who earned between the liquor server's minimum wage of $5.95 per hour and the general minimum wage of $6.85 per hour. (Full Story - 370 Words)

January 19, 2004 - McGuinty government to end 60-hour work week - The McGuinty government is delivering on its agenda for positive change by moving to end the previous government's "60-hour work week", Labour Minister Chris Bentley announced today. "We will ensure employees have the protection they need so they can decide - without undue pressure - whether to work longer hours," said Bentley. "That protection will be balanced with Ontario employers' need for flexibility so they can compete in today's market." Fair and balanced legislation will be introduced in the upcoming spring legislative session - following consultations - that would ensure employees cannot be forced to work more than 48 hours a week, Bentley said. (Full Story - 650 Words)

January, 2004 - WSIB Average Premium Rate stays the same for 2004 - The 2004 average premium rate is $2.19 for every $100 of insurable earnings -- the same as the average premium rate for 2003. However, this 0% average premium rate change does not necessarily mean that premium rates will stay the same for all employers. Premium rates for individual rate groups have been recalculated based primarily on injury frequency, and on how much claims cost for individual rate groups. (Full Story - 300 Words)

January 1, 2004 - New options for choosing health professionals - As of January 1, 2004, if you are injured and ill, you may make your initial choice of health professional from among the following four groups of health professionals: Chiropractors, Physicians, Physiotherapists and Registered Nurses (Extended Class). This change means that you may see Physiotherapists and Registered Nurses (Extended Class) -- RN (EC) -- without a referral from a Physician or a Chiropractor. (Full Story - 80 Words)

Saskatchewan:

January 9, 2004 - Record number of jobs in 2003 - Saskatchewan set a new record for employment in 2003, with more people working than ever before. Figures released today by Statistics Canada show Saskatchewan's average annual employment stood at 486,800. This represents an increase of 4,800 over the previous year, and surpasses the previous record for average annual employment of 485,000 set in 2000. (Full Story - 430 Words)

January 9, 2004 - WCB finalizes 2004 employer premium rate - The Saskatchewan Workers’ Compensation Board (WCB) today announced that the average employer premium rate for 2004 will increase by 12 per cent over last year’s average rate. The average 2004 rate is $2.05 per $100/payroll. (Full Story - 488 Words)

January, 2004 - Comp Institute 2004 - Since 1998, Comp Institute has brought together workers' compensation stakeholders annually. It's an opportunity to learn about workers' compensation and how to get the most out of it. Whether you're new to workers' compensation or have been involved for years, check out this no-cost, informative two-day educational opportunity. (Full Story - 140 Words)


GrandMaster Update

The current release of GrandMaster Suite (3.90.04) incorporates a number of changes to make it even easier to use the program and perform your payroll tasks. Recent program changes since our last Payroll News issue include:

  • Provincial TD1 Amounts added to Customized Payroll Report - You can now include Provincial TD1 amounts in the customized payroll report. The Report Fields tab now contains a checkbox for PD1 Amount and Provincial Additional Tax.
  • New Hires report now includes CCRA number - When you create the New Hires Report, it now includes the CCRA number. With this program change the CCRA Number is now specified as the first level sort, then the first day worked, then the employee name and finally the employee SIN
  • Deduction Calculation Code 102 now supports non-fixed values - When using deduction calculation method 102 in conjunction with an accumulator to track employee purchases, you were forced to use fixed values because the method had no calculation code and used fixed values that were not set when you edited the employee accumulator. This prevented the automatic reduction of the accumulator balance by the results of the deduction calculation. Now, instead of requiring you to use fixed amounts (and displaying a warning message) the program allows the accumulator to operate without calculation parameters. The program will also present a message indicating that the accumulator is dependant upon another calculation for it's result otherwise the result will be zero (since the accumulator is essentially a shell).
  • Create T4/T4A process now records CPP discrepancies greater than $0.99 - When you create the T4/T4A file, the program will now records employee records that have a CPP discrepancy that is greater than $0.99. This will add to a message count that displays at the completion of the T4/T4A File Creation process. It will warn you of the specific number of records that have a discrepancy.
  • New deduction calculation method added (number 129) - A new deduction calculation method (number 129) has been added that allows you to calculate LTD. A percentage of the employee's selected monthly earnings that are greater than the maximum you set are added to a percent of the maximum. The result is then multiplied by a rate to determine the employee deduction. If required, you may define a benefit as a percent of the deduction.
  • New deduction calculation method added (number 130) - A new deduction calculation method (number 130) has been added that allows you to calculate the deduction (on a yearly basis) on a percentage of selected earnings less than the YMPE and a percentage greater than YMPE. The benefit is treated the same as the deduction but can have unique % rates.
  • Provincial TD1 restore utility added - A utility program has been added to restore the provincial TD1 amounts to the provincial TD1 basic amount for employees whose TD1 amounts were incorrectly indexed with v3.90.00. This utility program will restore all employees whose provincial TD1 amount is greater than zero to the basic exemption amount for the current year. All employees who have a provincial TD1 exemption amount greater than the basic exemption must be updated manually.
  • Federal basic TD1 restore utility added - A utility program has been added to restore the federal TD1 amounts to the Federal TD1 basic amount for employees whose TD1 amounts were incorrectly indexed with v3.90.00. This utility program will restore all employees whose federal TD1 amount is greater than zero to the basic exemption amount for the current year. All employees who have a federal TD1 exemption amount greater than the basic exemption must be updated manually.

Stay tuned to CanPay's Product News page to receive the latest changes and release information for all GrandMaster products!


CPP/QPP, WCB and EI Rates for 2004

The updated rates for CPP/QPP, EI and WCB have been announced for 2004. They are briefly discussed here along with some basic year-end procedures for each item.

2004 Canada/Quebec Pension Plan

The Canada Customs and Revenue Agency (CCRA) has released the Canada Pension Plan (CPP) and Quebec Pension Plan (QPP) rates for 2004. The rates are as follows:

 
Canada
Quebec
Years Maximum pensionable earnings: $ 40,500 $ 40,500
Years Basic Exemption (by pay period type)    
Annual $ 3,500 $ 3,500
  Monthly (12) $ 291.66 $ 291.66
  Semi-Monthly (24) $ 145.83 $ 145.83
  Bi-Weekly $ 134.61 $ 134.61
  Weekly $ 67.30 $ 67.30
Maximum Contributory Earnings $ 37,000 $ 37,000
Contribution Rate 4.95% 4.95%
Maximum Contribution (Employee/Employer) $ 1,831.50 $ 1,831.50

Some CPP-related items to consider when preparing your T4s and T4As:

  • Ensure that none of your employees have contributed more than the 2003 CPP maximum of $1,801.80.
  • All taxable benefits must be included as employment income and the corresponding source deduction totals must be updated. The latter is especially important for individuals below the yearly pensionable (CPP) earnings. Remember that non-cash taxable benefits are not insurable, with the exception of board and lodging benefits provided in the same pay period that an employee receives cash earnings and an employer’s contribution to an employee’s registered retirement savings plan.
  • CPP/QPP pensionable earnings (Box 26) on the T4 slip must be completed only if the amount is different from the amount reported in Box 14. If the amounts are the same, you can leave the box blank.
  • You must prepare two T4 slips for employees who made contributions to both the CPP and QPP: one showing the QPP deducted and the applicable pensionable earnings and remuneration the employee earned in Quebec, and the other showing the CPP deducted and the applicable pensionable earnings and remuneration the employee earned in any other jurisdiction.
  • Ensure that you have not adjusted the CPP contribution amounts you reported on the T4 if you over-deducted employee contributions. The CCRA will credit the employees with the over-contribution when they file their tax return.

Workers’ Compensation Filing Deadlines/Assessable Earnings

Each Canadian province/territory has enacted workers’ compensation legislation, which identifies the industries covered, employers’ responsibilities for paying assessments and responding to workplace accidents, and the conditions under which an employee may claim workers’ compensation benefits.

The following table outlines the different province/territory WCB filing deadlines and rates for 2004:

 
Filing Deadline
Max. Assessable Earnings
Alberta
February 28
$ 61,200
British Columbia
February 28 (quarterly)
March 1 -15 (yearly)
$ 60,700
Manitoba
February 28
$ 56,310
New Brunswick
February 28
$ 50,000
Newfoundland and Labrador
February 28
$ 45,500
Northwest Territories
February 28
$ 66,500
Nunavut
February 28
$ 66,500
Nova Scotia
February 28
$ 41,100
Ontario
March 31
$ 66,800
P.E.I.
February 28
$ 41,200
Quebec
March 15
$ 55,500
Saskatchewan
February 28
$ 53,000
Yukon
February 28
$ 65,800
  • When preparing your T4s and T4As, remember that top-up amounts paid to employees receiving WCB benefits are reported on the T4. The actual WCB benefits are not reported on the form. With the exception of Quebec, WCB benefits are reported by the provincial/territorial boards on form T5007, Statement of Benefits.

Employment Insurance

Employment Insurance (EI) contributions are the second deduction following Canada or Quebec Pension Plan contributions. Both employers and employees must pay into EI. There are no age limits for EI premiums. Eligibility for benefits is based on the number of hours an individual works, with their earnings insured from the first dollar earned, up to an annual maximum. The maximum has been set at $39,000 since 1997 and will remain at $39,000 until the average industrial wage reaches that level.

The following table outlines the new EI rates for 2004:

 
2004
Maximum Annual Insurable Earnings
$39,000.00
Premium Rate (Employee)
1.98%*
Premium Rate (Employer, 1.4** x Employee)
2.77%*
Annual Maximum Premium (Employee)
$772.20*
Annual Maximum Premium (Employer, 1.4** x Employee)
$1,081.08*
   
* Unless a reduced premium rate applies
 

Some EI-related items to consider when preparing your T4s and T4As:

  • No employee has contributed more than $819.00 in EI premiums, the 2003 EI maximum.
  • Ensure that you have not adjusted the EI premium amounts you reported on the T4 if you over-deducted employee contributions. The CCRA will credit the employees with the over-contribution when they file their tax return.