Hiring Credit for Small Businesses

If you are an employer, you will be interested to learn that the Canada Revenue Agency has extended the Hiring Credit for the 2013 payroll year.

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The CRA website says:

“The 2011 federal budget created a hiring credit for small business (HCSB), a credit intended to stimulate new employment and support small businesses. The 2012 federal budget extended the HCSB for 2012. The latest federal budget proposes to expand and extend the HCSB for 2013.

The HCSB gives small businesses relief from the employer’s share of employment insurance (EI) premiums paid in a year. It does this by crediting up to $1,000 on the payroll account, based on the increase in an employer’s EI premiums paid in one year over those paid in the year before.”

now hiringTherefore, if you have hired more employees, or increased the hours worked by your employees through 2013, then you will qualify for a credit in 2014.  You do not need to apply for this credit, as CRA will calculate it for you based on the amount of your increase to determine how much of a credit you are eligible for (to a maximum of $1000).  You will receive a notice on one of your Source Deduction forms (PD7A) to let you know how much you qualified for.

Once you know how much that amount is for your business, you can reduce the amount of a Source Deduction remittance by that amount.  Be sure to record that credit amount in your EI expense account.  If you use a bookkeeper or other payroll provider for your payroll completion, be sure to give them the notice you receive so they can make the appropriate adjustments in your bookkeeping.

 

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About Cougar Ridge Bookkeeping

We know that to be successful in business, keeping good records is vital. We also know that operating a successful business takes hours of dedication and hard work. For many, it means that the bookkeeping gets put on the "to-do list". We are here to help you!
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