Avoid payroll and tax errors by following these easy tips
Payroll and tax errors can cost your business large sums of money. Fortunately, you can avoid penalties by taking easy steps to protect your business.
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Business owners can often fix these top payroll and tax errors by building key processes into how they run their office. Every business tailors its basic back-office functions to its specific needs. Payroll and tax belong high on that list – allowing business owners to stay on the right side of legislation and government bodies.
This infographic lists the top three payroll and tax errors business owners make, how much the penalties could cost the business, and how business owners can avoid them.
Late remitting of source deductions:
3% after one day, going up to 10% after one week
This is a poor reason to give your money away, because all you need to do is report what you owe. If your accountant or tax professional is competent, you should never pay this.
Incorrect CPP/EI deductions:
10–20% of the difference
This happens when you have someone that doesn’t know or understand the rules governing taxable benefits. Or when they make mistakes in calculations.
Plus: failing to withhold CPP/EI could leave you liable for the employee’s share too.
Tardy on the T4s:
Up to $7500
Not filing your T4 slips on time can be costly – and the more slips you miss, the costlier it becomes. Make sure get those slips to both the CRA and your employees (or former employees).
Don’t let carelessness be the reason you lose money to payroll penalties.