Hi Sam,
Can you check your payment records and provide details of the payments to the provinces you indicated below? I have mentioned that not all Canadian provinces have such EHT. EHT only applies to employees reporting in the provinces of Ontario, Manitoba, BC, Newfoundland and Quebec.
I understand you indicated payments have been made to Nova Scotia and Alberta which may not be applicable- please verify. In fact if you have a permanent establishment in British Columbia, EHT would apply in that province similar to Quebec, Manitoba, Newfoundland and Ontario.
Best Regards,
George Singh
Executive Director, Indirect Tax
KPMG LLP
333 Bay Street, Suite 4600
Toronto, ON. M5H 2S5
P: (416)777-3900
F: (416)777-8226
• georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>
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From: Sam Naffaa <hcao.accounting@thekey.com>
Sent: Thursday, October 5, 2023 12:00 PM
To: Singh, George <georgesingh@kpmg.ca>
Subject: Re: SJD EHT 2023 [EXTERNAL]
Hi George,
We have entities in ON, BC, MB,AB,QB,NS. Up to my knowledge we pay EHT in all of them through our Payroll system except Vancuver. If this still is not clear we can have a quick meeting next week to clarify it for both of us. However, I have filled out the Oakville form and attached. Please let me know if you have any questions or notes.
Regards,
Sam Naffaa, CMA
905.337.1288
Please note my email has changed:
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On Thu, Oct 5, 2023 at 11:43 AM Singh, George <georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>> wrote:
Hi Sam,
Sorry I am confused with your question. EHT is applicable for employees that report into an Ontario establishment or are paid from an Ontario P/E.
I do not understand what you mean by Vancouver. The Ontario EHT filings have to be completed monthly for Arya Health (both entities) and SJD Care Services with a “true-up” annual reconciliation in March.
Best Regards,
George Singh
Executive Director, Indirect Tax
KPMG LLP
333 Bay Street, Suite 4600
Toronto, ON. M5H 2S5
P: (416)777-3900
F: (416)777-8226
• georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>
Please consider the environment before printing this e-mail
From: Sam Naffaa <hcao.accounting@thekey.com<mailto:hcao.accounting@thekey.com>>
Sent: Thursday, October 5, 2023 11:38 AM
To: Singh, George <georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>>
Cc: Timothy Thomas <tt@thekey.com<mailto:tt@thekey.com>>
Subject: Re: SJD EHT 2023 [EXTERNAL]
Hi George,
Thank you so much for the explanation and the information. Everything is clear to me now but the below sentence confused me as we are remitting the EHT to all entities except Vancouver through the Payroll system (Cerdiane) so as per the below sentence we don't have to file it until the end of the year. SO we have no action to be done now other than remitting the vancouver EHT. Am I correct?
[cid:image001.png@01D9F781.2F5239A0]
Regards,
Sam Naffaa, CMA
905.337.1288
Please note my email has changed:
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On Thu, Oct 5, 2023 at 6:57 AM Singh, George <georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>> wrote:
Hi Sam,
The Employer Health Tax (‘EHT’) is remitted by employers based on their Ontario payroll. Effective January 1, 2020, employers are exempt from tax on the first $1 million of Ontario payroll. The EHT exemption is indexed to inflation and the next scheduled adjustment for is January 1, 2029. Employers with annual Ontario payroll over $5 million cannot claim this exemption. Only one annual exemption is available for an associated group of employers. When the combined total Ontario remuneration of all associated employers exceeds $5 million, these employers are not eligible for the exemption.
If total Ontario remuneration is greater than $1.2 million for 2021 and later you must pay monthly instalments and file an annual return on or before March 15th of the following calendar year- I understand this applies to SJD Care Services and Arya Healthy Living entities.
The requirement for instalment payments is based on the employer’s payroll from the prior year. A multiple accounts employer must file separate instalments and annual returns for each account. Eligible employers with multiple accounts must allocate the exemption between their accounts. The tax rate for a multiple account employer is based on the combined Ontario payroll of all the employer’s accounts.
I had provided a one-page report to be completed for Arya Healthy Living Oakville, and 9 returns for Arya Healthy Waterloo and 9 returns for SJD Care Services via email yesterday (see attached) which need to be completed. Unfortunately, the Ministry has not provided a one-page filing option for Arya Healthy Living Waterloo and SJD Care Services similar to the Arya Healthy Living Oakville filing option. Please complete and send back to my attention and I will review and submit to the Ministry of Finance. It is important to note that these returns had been mailed to the Waterloo, Ontario location on a monthly basis for the past 9 months. Perhaps it would be worth investigating who is receiving these filings and what they are doing with them as we will need to complete these on a monthly basis going forward.
Hope this helps.
Best Regards,
George Singh
Executive Director, Indirect Tax
KPMG LLP
333 Bay Street, Suite 4600
Toronto, ON. M5H 2S5
P: (416)777-3900
F: (416)777-8226
• georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>
Please consider the environment before printing this e-mail
From: Sam Naffaa <hcao.accounting@thekey.com<mailto:hcao.accounting@thekey.com>>
Sent: Thursday, October 5, 2023 6:30 AM
To: Singh, George <georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>>
Cc: Timothy Thomas <tt@thekey.com<mailto:tt@thekey.com>>
Subject: Re: SJD EHT 2023 [EXTERNAL]
Hi George,
Thank you for sending this again, I have read this earlier but I thought 1.2M as a threshold of monthly filing is different from exemption.
However, I will fill it out and send it to you. Please send me the SJD and Waterloo.
Regards,
Sam Naffaa, CMA
905.337.1288
Please note my email has changed:
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On Thu, Oct 5, 2023 at 2:18 PM Singh, George <georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>> wrote:
Hi Sam,
Hope you are doing well.
I wanted to provide details on the EHT rules (see below) for your consideration which I may have shared previously.
Under the EHT Act, employers are required to pay EHT on the total remuneration paid to employees who report for work at a permanent establishment (‘PE’) of the employer in Ontario, and to employees who do not report for work at a PE of the employer, but who are paid from or through a PE of the employer in Ontario.
Remuneration includes all payments, benefits and allowances received or deemed to be received, that would be included in income by reason of section 5, 6 or 7 of the Income Tax Act (Canada) (‘ITA’), or would be required if the individual were resident in Canada.
Generally, EHT remuneration includes the following:
* salaries and wages
* bonuses, commissions and other similar payments
* advances of salaries and wages
* vacation pay
* gratuities paid through an employer
* taxable allowances and benefits
* directors' fees
* payments for casual labour
* amounts paid by an employer to top up benefits
* stock option benefits
* employer-paid contributions to a Registered Retirement Savings Plan (RRSP)
* employer-paid group life insurance premiums
It is important to note that the $1M exemption would apply to all associated group of companies and I am not sure whether that had been considered by any of the other associated companies. If the remuneration of the associated group of companies was in excess of the $1M limit, I believe you would not be able to use the annual exemption. The rules for associated corporations, under section 256 of the ITA are used to determine whether or not employers are associated for EHT purposes. Although these rules refer to corporations, their application is extended under the Employer Health Tax Act to include individuals, partnerships and trusts. My thought is that you will need to gather all the payroll reports for all associated companies in order to claim the exemption accordingly.
Effective January 1, 2014, the amount of annual Ontario payroll that was exempt from EHT increased from $400,000 to $450,000. The exemption was eliminated for private‑sector employers with annual Ontario payrolls over $5 million. The Ontario government increased the EHT exemption due to the special circumstances caused by the coronavirus (COVID-19) in Ontario. For 2020 to 2028, eligible employers are exempt from EHT on the first $1,000,000 of total Ontario remuneration each year.
You can claim the tax exemption if:
* you are an eligible employer as defined under the EHT Act
* you pay income taxes
* your Ontario payroll for the year (including the payroll of any associated employers) is less than $5 million or you are a registered charity
* you are not under the control of any level of government
* your board of directors does not include any municipal representatives
In terms of filing the returns for Arya Healthy Living and SJD Services Care Inc. we will need to consider payroll for all associated companies and determine if the exemption would apply and whether any associated entity will be sharing the $1M exemption (if applicable). If payroll exceeds the annual exemption limit than no exemption will be available for the associated group of companies.
I have attached the return for SJD Services and also highlighted the section with reference to signature for your reference. We are hoping you can populate the SJD Care and Arya returns based on the Excel figures you had provided. If you prefer we do so, we are happy to complete the returns based on your figures provided but wanted to note it may involve significant time to do so.
Please let us know if you prefer a call to discuss.
Hope this helps.
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Business No. Reference No.
Page 2 / 2
000027
767800113TE0001 L1578718240
Instalment Schedule
Instalment Requirements: Please complete and return this page for the year indicated below, stating the remuneration by month. If your annual EHT return has been filed, the total of Column 1 - Total Ontario Remuneration must agree to Line 1 on your return.
For the calendar year 2022
(1) (2) (3) (4)
Instalment Period
Total Ontario Remuneration
Exemption Claimed
Taxable Ontario Remuneration
(1) - (2)
Instalment Amount Due (Taxable Ontario Remuneration X 1.95%)
Instalment Due Date
Jan 1 - 31
Feb 15
Feb 1 - 28
Mar 15
Mar 1 - 31
Apr 15
Apr 1 - 30
May 15
May 1 - 31
June 15
June 1 - 30
July 15
July 1 - 31
Aug 15
Aug 1 - 31
Sept 15
Sept 1 - 30
Oct 15
Oct 1 - 31
Nov 15
Nov 1 - 30
Dec 15
Dec 1 - 31
Jan 15
Comments:
Name Signature Phone #
Date Title Fax #
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Best Regards,
George Singh
Executive Director, Indirect Tax
KPMG LLP
333 Bay Street, Suite 4600
Toronto, ON. M5H 2S5
P: (416)777-3900
F: (416)777-8226
• georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>
Please consider the environment before printing this e-mail
From: Sam Naffaa <hcao.accounting@thekey.com<mailto:hcao.accounting@thekey.com>>
Sent: Thursday, October 5, 2023 5:58 AM
To: Singh, George <georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>>
Cc: Timothy Thomas <tt@thekey.com<mailto:tt@thekey.com>>
Subject: Re: SJD EHT 2023 [EXTERNAL]
Hi George,
If I am not mistaken. We don't have to file monthly for Waterloo and Oakville as we did not reach yet the $1,200,000 unless they will consider the three entities in ON. Please have a look at the below screenshot and let me know what you think.
Regards,
Sam Naffaa, CMA
905.337.1288
Please note my email has changed:
hcao.accounting@TheKey.com<mailto:Madhu.Vijayan@TheKey.com>
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On Wed, Oct 4, 2023 at 11:54 PM Singh, George <georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>> wrote:
Hi Sam,
Similar to the SJD Care Services EHT account, I will need your assistance in populating the attached form for Arya Healthy Living Oakville.
Once completed, please sign and send back to me and I will submit to the Ministry.
Best Regards,
George Singh
Executive Director, Indirect Tax
KPMG LLP
333 Bay Street, Suite 4600
Toronto, ON. M5H 2S5
P: (416)777-3900
F: (416)777-8226
• georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>
Please consider the environment before printing this e-mail
From: Singh, George
Sent: Wednesday, October 4, 2023 3:52 PM
To: Sam Naffaa <hcao.accounting@thekey.com<mailto:hcao.accounting@thekey.com>>
Cc: Timothy Thomas <tt@thekey.com<mailto:tt@thekey.com>>
Subject: RE: SJD EHT 2023 [EXTERNAL]
Hi Sam,
I have been able to receive the instalment letters for the past 9 months for the SJD Care Services EHT account and request that you populate the respective forms with the taxable Ontario remuneration, tax due (1.95%), amounts owing and payment amounts made by respective months.
Once completed, can you forward to me for review and I will send off to the Ministry of Finance?
Best Regards,
George Singh
Executive Director, Indirect Tax
KPMG LLP
333 Bay Street, Suite 4600
Toronto, ON. M5H 2S5
P: (416)777-3900
F: (416)777-8226
• georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>
Please consider the environment before printing this e-mail
From: Sam Naffaa <hcao.accounting@thekey.com<mailto:hcao.accounting@thekey.com>>
Sent: Wednesday, October 4, 2023 2:27 PM
To: Singh, George <georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>>
Cc: Timothy Thomas <tt@thekey.com<mailto:tt@thekey.com>>
Subject: Re: SJD EHT 2023 [EXTERNAL]
Attached the excel sheet
Regards,
Sam Naffaa, CMA
905.337.1288
Please note my email has changed:
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On Wed, Oct 4, 2023 at 2:25 PM Sam Naffaa <hcao.accounting@thekey.com<mailto:hcao.accounting@thekey.com>> wrote:
Hi George,
I have consolidated the toronto entities in the attached excel report. There are also taps for the breakdown of the amounts. Please let me know if you need any further information fir Toronto. I will send the other mentioned provinces soon.
Last week I paid $2,185.89 for Oakville.
Regards,
Sam Naffaa, CMA
905.337.1288
Please note my email has changed:
hcao.accounting@TheKey.com<mailto:Madhu.Vijayan@TheKey.com>
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On Tue, Oct 3, 2023 at 10:54 AM Singh, George <georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>> wrote:
Hi Sam,
Can you confirm for which entity the numbers below apply to (Tor CG versus Tor Corp) and if you have received those monthly returns to be filed? Can you also confirm if the outstanding balance for the Arya Healthy Living Oakville account had been remitted. You may recall that the required payment in the amount of $2,185.89 was requested.
Perhaps it would be best to send one comprehensive report illustrating the total remunerations on a monthly basis per entity in Excel format (if possible) so we can reconcile and determine applicable amounts due,
As for EHT, not all Canadian provinces have such EHT. EHT only applies to employees reporting in the provinces of Ontario, Manitoba, BC, Newfoundland and Quebec.
Hope this helps.
Best Regards,
George Singh
Executive Director, Indirect Tax
KPMG LLP
333 Bay Street, Suite 4600
Toronto, ON. M5H 2S5
P: (416)777-3900
F: (416)777-8226
• georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>
Please consider the environment before printing this e-mail
From: Sam Naffaa <hcao.accounting@thekey.com<mailto:hcao.accounting@thekey.com>>
Sent: Saturday, September 30, 2023 4:51 AM
To: Singh, George <georgesingh@kpmg.ca<mailto:georgesingh@kpmg.ca>>
Cc: Timothy Thomas <tt@thekey.com<mailto:tt@thekey.com>>
Subject: SJD EHT 2023 [EXTERNAL]
Hi George, Please find elbow EHT monthly wise for filling. Please let me know once done. By the way, Do you have access to Winnipeg, Alberta, Vancouver and Nova Scotia for EHT filing?
Regards,
Sam Naffaa, CMA
905.337.1288
Please note my email has changed:
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