6.4 Provincial Payroll Taxes

6.4.1 Employer Payroll Taxes

Certain Canadian provinces levy an employer payroll tax, which contributes to funding their respective healthcare (and sometimes post-secondary education) systems. The provinces that currently have employer payroll taxes are British Columbia (since 2020), Manitoba, Newfoundland and Labrador, Ontario, and Quebec.

Each province sets their rates based on the size of payroll, and most jurisdictions exempt employers whose total remuneration falls below a certain threshold. For example, an employer whose total pay for all employees is less than $500,000 is exempt from the employer health tax in BC; an employer whose total pay for all employees is less than $1 million is exempt from the employer health tax in Ontario (Government of British Columbia, 2024; Government of Ontario, 2024).

A comparison of payroll tax rates and exemptions can be found here: Provincial Payroll Tax

See the table in Chapter 8.3 Payments and Remittances for specifics and remittance due dates.

To find more information about each province’s payroll tax, explore these government resources:

References

CanPay Software. (n.d.). Provincial payroll tax. https://www.canpay.com/payroll-information/provincial-payroll-tax.html

Government of British Columbia. (2024). Employer health tax overview. https://www2.gov.bc.ca/gov/content/taxes/employer-health-tax/employer-health-tax-overview

Government of Newfoundland and Labrador. (n.d.). Health and post-secondary education tax (Payroll tax). https://www.gov.nl.ca/fin/tax-programs-incentives/business/education/

Government of Ontario. (2024). Employer health tax (EHT). http://www.ontario.ca/document/employer-health-tax-eht

Manitoba.ca. (n.d.). The health and post-secondary education tax levy. https://www.gov.mb.ca/finance/taxation/taxes/payroll.html

Revenu Québec. (n.d.a). Employer contributions to the Health Services Fund. https://www.revenuquebec.ca/en/businesses/source-deductions-and-employer-contributions/calculating-source-deductions-and-employer-contributions/employer-contributions-to-the-health-services-fund/

Revenu Québec. (n.d.b). Total payroll threshold and Health Services Fund contribution rate. https://www.revenuquebec.ca/en/businesses/source-deductions-and-employer-contributions/calculating-source-deductions-and-employer-contributions/employer-contributions-to-the-health-services-fund/total-payroll-threshold-and-health-services-fund-contribution-rate/