Provincial Payroll Tax

Canada Payroll ServiceCurrently, five Canadian provinces levy a tax on employers based on the total annual salaries earned by their employees. Depending on the province, a portion or all of these taxes are used primarily to fund the health plans for each province. The provinces who impose a payroll tax are:

  • British Columbia
  • Manitoba
  • Newfoundland and Labrador
  • Ontario
  • Quebec

With the exception of Quebec, each of the five provinces who impose a payroll tax also provide an exemption threshold to assist smaller businesses. Use the table below to review the levy requirements for each of the provinces. You can select a province name to view more detailed information about the region.

Note: The Northwest Territories and Nunavut levy provincial health premiums on the income of individuals who are subject to income tax in those jurisdictions (though these levies are not actual income taxes).

Province Payroll Tax Rate

British Columbia
Employer Health Tax (EHT)

$500,000 or less

Exempt

Over $500.000 to $1.5 Million

2.925% x (Payroll - $500,000)

Over 1.5 Million

1.95% x Payroll

Manitoba
Health and Post Secondary Education Tax Levy (HE Levy)

$1.5 Million or less

Exempt

Over $1.5 Million to $3 Million

4.3% x (Payroll - $1.5 Million)

Over $3 Million

2.15% x Payroll

Ontario
Employer Health Tax (EHT)

$1 Million or less

Exempt

Over $1.2 Million

1.95%

Quebec
Health Services Fund

$1 Million or less (for businesses other than primary and manufacturing)

1.25% x Payroll

$1 Million or less (for businesses in primary and manufacturing)

1.65% x Payroll

Over $1 Million but under $6.5 Million

Use formula defined in the Quebec form TP-1015.G-V

Over $6 Million

4.26% x Payroll

Newfoundland and Labrador
Health and Post Secondary Education Tax (HAPSET)

Under $1.3 million

Exempt

Over $1.3 Million

2% x Payroll

 


Looking for Payroll Services in Canada?

CanPay provides desktop and cloud payroll solutions for thousands of companies across Canada. If your business has a unique payroll need or you are simply looking for an alternative to your current method, contact us today. We can offer you a customized solution that will suit your business requirements. Please call 1-800-665-5129 or send an email request to: sales@canpay.com.

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