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When to remit (pay)

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Background

Your remitter type sets your remitting frequency and affects your due dates. Generally, it is based on your average monthly withholding amount (AMWA)  from 2 calendar years ago. The due dates apply to both:

  • Remitting periods when you pay or give remuneration
  • Reporting a nil remittance when you have seasonal workers or no employees

Learn more: Types of remitters.

What is the payment due date

Based on the remitter type

You can view your remitter type on My Business Account or Represent a Client.

Quarterly remitters, new small employer – Monthly withholding amount is $0 to $999.99 and you have a perfect compliance record

Situation

Quarterly remitters – New small employers , with a perfect compliance record

Remitting frequency, periods and due dates

  • Your remitting frequency is quarterly
  • Your remitting period is:
    • January 1 to March 31
    • April 1 to June 30
    • July 1 to September 30
    • October 1 to December 31
  • Your remittance due date is:
    • April 15
    • July 15
    • October 15
    • January 15

Remitting more frequently

If you remit more frequently than required by your assigned remitter type, the CRA will accept early payments. However, the remitter type will not be changed. You can request to change your remitter type by calling 1-800-959-5525.

Quarterly remitters, account opened for 12 months or longer – AMWA is from $0 to $2,999.99 and you have a perfect compliance record

Situation

Quarterly remitters – Small employers , with a perfect compliance record

Remitting frequency, periods and due dates

  • Your remitting frequency is quarterly
  • Your remitting period is:
    • January 1 to March 31
    • April 1 to June 30
    • July 1 to September 30
    • October 1 to December 31
  • Your remittance due date is:
    • April 15
    • July 15
    • October 15
    • January 15
Regular remitters – AMWA is from $0 to $24,999.99

Situation

Regular remitters 

Remitting frequency, periods and due dates

  • Your remitting frequency is monthly
  • Your remitting period is the calendar month
  • Your remittance due date is the 15th day of the next month

Remitting more frequently

If you remit more frequently than required by your assigned remitter type, the CRA will accept early payments. However, the remitter type will not be changed. You can request to change your remitter type by calling 1-800-959-5525.

Accelerated remitters – AMWA is from $25,000.00 to $99,999.99

Situation

Accelerated remitters – Threshold 1 

Remitting frequency, periods and due dates

  • Your remitting frequency is up to twice a month
  • Your remitting period is:
    • 1st to 15th of the month
    • 16th to end of the month
  • Your remittance due date is:
    • 25th day of same month
    • 10th day of the next month
Accelerated remitters – AMWA is $100,000.00 or more

Situation

Accelerated remitters – Threshold 2 

Remitting frequency, periods and due dates

  • Your remitting frequency is up to 4 times a month
  • Your remitting period is:
    • 1st to 7th of the month
    • 8th to 14th of the month
    • 15th to 21st of the month
    • 22nd to the last day of the month
  • Your remittance due date is:
    • 3rd working day after the 7th
    • 3rd working day after the 14th
    • 3rd working day after the 21st
    • 3rd working day after the last day of the month

Based on a special situation

You have no employees or only seasonal workers (nil remittance)

Payment due date

Report a nil remittance by your due date based on your remitter type. This can happen if you have no employees or you have seasonal workers.

Tell the CRA when you will make the next source deductions.

If you do not know, give an estimated date. If you do not give a date, the CRA will expect you to resume remitting again for the next month or quarter.

Seasonal business

A person has a seasonal business and is a regular remitter. In October the person did not make any source deductions, as they did not pay any employees.

The person calls TeleReply by November 15 to report their nil remittance for October.

If they do not give a specific date when they will resume remitting again, the CRA will expect the person to remit source deductions for November by December 15.

Source deductions made in the month or quarter

Do not report a nil remittance if you made source deductions in the month or quarter.

Business status changes

You must tell the CRA if your business status changes.

Learn more: Make changes to your account.

Your business is changing (final remittance)

Payment due date

Report a final remittance within 7 calendar days of the following dates:

  • Business stops operating
  • Sole proprietor or partner dies
  • Legal status changes
  • Bankruptcy or entry into receivership
  • Business is restructured, reorganized, or amalgamated

Business status changes

You must tell the CRA if your business status changes.

Learn more: Make changes to your account.

When a payment is considered received on time

When a due date falls on a Saturday, Sunday, or public holiday recognized by the CRA, your payment is considered on time if the CRA receives it on or it is processed at a Canadian financial institution on or before the next business day.

Payment method

  • Financial institution – Internet or telephone banking: Date the financial institution credits CRA with the payment
  • Financial institution - In person: Date stamped on the remittance voucher
  • By mail: Date CRA receives it
  • Posdated cheques and Pre-authorized debit: Negotiable date
  • My Payment: Same day if made on a business day, or the following business day
  • Third party: Determined by the third party service provider

Learn more: How to remit (pay).

How to change your remitter type

You can request the CRA to review your account and confirm your remitter type and frequency in writing if:

  • You are a regular remitter and all of the following apply:
    • You have had your account for 12 months or more
    • You meet the conditions to be a quarterly remitter, small employer
  • You are an accelerated remitter, and using last year's AMWA would lower your remitting frequency

To request a review, call 1-800-959-5525.

What happens if your cheque is returned or your financial institution refuses to process the payment

The CRA will charge a fee of up to $25 for each cheque that is returned for any of the following reasons:

  • Non-sufficient funds (NSF)
  • Closed account
  • Stopped payments

What if you remit (pay) late or you do not make a payment

The CRA will apply a penalty and charge interest.

Penalty

  • The CRA will charge you a penalty when you deduct amounts:

    • Over $500, but do not send them to the CRA
    • Over $500, but send them to the CRA late
    • Under $500, and knowingly or under circumstances of gross negligence do not send them to the CRA or send them late

  • The penalty is:

    • 3% if the amount is 1 to 3 days late
    • 5% if it is 4 or 5 days late
    • 7% if it is 6 or 7 days late
    • 10% if it is more than 7 days late, or if no amount is remitted
    • 20% if this is the second or subsequent time you are assessed this penalty in a calendar year, if the failures were made knowingly or under circumstances of gross negligence
Example: When a remittance is considered late

A remittance that was due in January of the current year (for deductions made in December of the previous year) is considered late when paid with the previous year's information return (T4, T4A) and this return is filed after the remittance due date.

Interest

If you do not pay an amount that is due, the CRA may apply interest from the day the payment was due. The CRA:

  • Sets the interest rate every calendar quarter, based on prescribed interest rates
  • Compounds the interest daily
  • Applies interest to unpaid penalties

The interest rates are announced in the month preceding each calendar quarter.

References

Legislation

ITR: 108(1.2)
Remitting due dates – Average monthly withholding amount
ITR: 108(1)
Remitting due dates – Regular remitter
ITR: 108(1.1)(a)
Remitting due dates – Threshold 1
ITR: 108(1.1)(b)
Remitting due dates – Threshold 2
ITR: 108(1.12)(a)
Remitting due dates – Quarterly
CPP Reg: 8
Remitting due dates – Average monthly withholding amount
CPP Reg: 8(1)
Remitting due dates – Regular remitter
CPP Reg: 8(1.1)(a)
Remitting due dates – Threshold 1
CPP Reg: 8(1.1)(b)
Remitting due dates – Threshold 2
CPP Reg: 8(1.2)
Remitting due dates – Quarterly
IECPR: 4
Remitting due dates – Average monthly withholding amount
IECPR: 4(1)
Remitting due dates - Regular remitter
IECPR: 4(2)(a)
Remitting due dates – Threshold 1
IECPR: 4(2)(b)
Remitting due dates – Threshold 2
IECPR: 4(3.1)
Remitting due dates – Quarterly
ITA: 153(1)
Requirement to deduct and remit
ITA: 227(9)(a)
Failure to remit/late remitting – 10% penalty
ITA: 227(9)(b)
Failure to remit/late remitting – 20% penalty (gross negligence)
ITA: 227(9.1)
Failure to remit/late remitting – $500 exemption
ITA: 227(9.2)
Failure to remit/late remitting – Interest
ITA: 227(10)
Failure to remit/late remitting – Authority to assess
CPP: 21(1)
Requirement to deduct and remit
CPP: 21(2)
CPP liability for failure to deduct
CPP: 21(6)
Failure to remit/late remitting – Interest
CPP: 21(7)(a)
Failure to remit/late remitting – 10% penalty
CPP: 21(7)(b)
Failure to remit/late remitting – 20% penalty (gross negligence)
CPP: 22(1)
Failure to remit/late remitting – Authority to assess
EIA: 82(1)
Requirement to deduct and remit
EIA: 82(4)
EI liability for failure to deduct
EIA: 82(8)
Failure to remit/late remitting – Interest
EIA: 82(9)(a)
Failure to remit/late remitting – 10% penalty
EIA: 82(9)(b)
Failure to remit/late remitting – 20% penalty (gross negligence)
EIA: 85(1)
Failure to remit/late remitting – Authority to assess

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Average monthly withholding amount (AMWA)

The AMWA is calculated by:

  • Total of all required payroll deduction remittances in a calendar year
  • ÷divideded by Number of months (maximum 12) that required a payroll deduction remittance in that calendar year
     
  • =eqauls Average monthly withholding amount (AMWA)

Quarterly remitters – New small employers

A new employer is an employer whose payroll account has been open for less than 12 months. You do not have to apply. Remit quarterly unless the CRA tells you, on your statement of account, that you have to remit at a different frequency.

New employers are eligible to be a quarterly remitter if they meet both of the following conditions:

  • The monthly withholding amount (MWA) is less than $1,000
    What is the "monthly withholding amount (MWA)"

    The monthly withholding amount (MWA) is the total of all required remittances in one calendar month.

  • A perfect compliance record is maintained on all payroll and GST/HST accounts

A new employer who no longer qualifies to be a quarterly remitter will be considered a regular remitter in the next calendar quarter.

Example – MWA condition is not met

Zach's Auto Repairs has a MWA of $500 for January, $1,500 for February, and $1,500 for March. The employer's quarterly remittance of $3,500 is due by April 15.

Since the MWA for February and March was $1,000 or more, the employer will be considered a regular remitter as of the beginning of the second calendar quarter. The employer will have to remit monthly beginning with their MWA for the month of April, which is due by May 15.

Perfect compliance record

Quarterly remitters must meet all of the following conditions over the previous 12 months to maintain a perfect compliance record in their payroll and GST/HST accounts:

  • The payroll account must have:
    • No late remittances or late remitting penalties
    • No failure to remit penalties
    • No failure to deduct penalties
    • No overdue T4-type information return(s)
  • If the employer has a GST/HST account, it must have:
    • No balance owing
    • No overdue returns
    • No credit balance with a refund hold
Example – Perfect compliance record condition is not met

ABC Construction has a MWA of $500 for each of the months January, February and March. Where April 15 is not a holiday and the employer remits their quarterly remittance of $1,500 after April 15, the remittance is considered late.

Since the failure happened in April, ABC Construction may make their quarterly remittance for April, May and June by July 15. However, the company will have to remit monthly beginning with their MWA for the month of July, which is due by August 15.

Quarterly remitters – Small employers

An existing employer is an employer whose payroll account has been opened for at least 12 months (if the employer has multiple payroll accounts, at least one must have been open for at least 12 months).

Existing employers are eligible to remit quarterly if they meet all of the following conditions:

  • They have a payroll account that has been open for at least 12 months
  • The AMWA in the calendar year before the previous calendar year was less than $3,000
  • A perfect compliance record is maintained on all payroll and GST/HST accounts over the previous 12-month period

Existing employers who qualify to be quarterly remitters are notified in writing.

Existing employers who no longer qualify as quarterly remitters will be assigned a new remitter type for the following calendar year.

Perfect compliance record

Quarterly remitters must meet all of the following conditions over the previous 12 months to maintain a perfect compliance record in their payroll and GST/HST accounts:

  • The payroll account must have:
    • No late remittances or late remitting penalties
    • No failure to remit penalties
    • No failure to deduct penalties
    • No overdue T4-type information return(s)
  • If the employer has a GST/HST account, it must have:
    • No balance owing
    • No overdue returns
    • No credit balance with a refund hold

Regular remitters

Existing employers who meet all of the following conditions are regular remitters:

  • The AMWA in the calendar year before the previous calendar year was less than $25,000
  • The CRA has not assigned another remitter type
  • You are a new employer, but do not qualify to remit quarterly as a new small employer

Accelerated remitters – Threshold 1

Existing employers who meet both of the following conditions are Threshold 1 accelerated remitters:

  • The AMWA in the calendar year before the previous calendar year was at least $25,000 but not more than $99,999.99
  • The CRA did not assign another remitter type

Accelerated remitters – Threshold 2

Existing employers who meet both of the following conditions are Threshold 2 accelerated remitters:

  • The AMWA in the calendar year before the previous calendar year was at least $100,000
  • The CRA did not assign another remitter type

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