Back in the spring when the pandemic first started the federal government created the Temporary Wage Subsidy program, a 10% wage subsidy to help support small businesses. This was a separate program from the Canadian Emergency Wage Subsidy.
This program allowed qualifying businesses owners to remit less source deductions than normal hence keeping monies in the business’ pocket. The program ran from March 18, 2020 to June 19, 2020.
However, as I am finding out, a lot of small business owners that I have spoken with do not realize that they need to complete a PD27 if they received the 10% subsidy. This form is important because you are showing the CRA how much subsidy you claimed.
When filing your regular source deductions remittances there is no spot to indicate the subsidy, therefore CRA will not be able to reconcile your payments to your T4 Summary at the end of the year without it. CRA will end up showing that you have a balance owing to them and will want an explanation on the difference. Even worse, it could lead to being assessed unnecessary interest, penalties and aggravation.
There is no deadline to completing the PD27 form however it is suggested to get the form sent to CRA as early as possible. Preferably in early January. My practice uses Wagepoint for our payroll clients. The beauty of this application is that they have a summary to help complete the PD27 form for those clients that claimed the subsidy. Wagepoint is an amazing payroll solution that does many cool things.
If you have any questions about completing the PD27 form please contact your accountant or tax professional.
Contact us if you want to know more about how we can help you with your payroll requirements.