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Canada: Reminder for employers, indirect tax on employee benefits

Canada: Reminder for employers, indirect tax

Employers need to consider GST/HST and QST* regarding their employees' 2019 taxable benefits.

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Many employers that offer taxable benefits to their employees must remit amounts of GST/HST and QST related to these benefits by 31 March 2020.

These amounts of indirect tax are due each year, and are an actual cost to employers because they are not collected from the employees.

When determining the proper amounts to remit, employers need to note that some of their 2019 calculations may be different from the prior year's calculations due to the phase-out period of the recaptured input tax credits for HST purposes in certain provinces and the phase-out of input tax refund restrictions for QST purposes in Quebec.

*GST/HST and QST = goods and services tax / harmonized sales tax and Quebec sales tax

Read a January 2020 report prepared by the KPMG member firm in Canada

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