If you own a business and plan to hire workers from Canada, remember that there is a lot more to payroll than just cutting cheques. The business culture in Canada is complex. The Canadian government regularly produces payroll deduction tables to help employers deduct the correct amount from each employee’s pay cheque. U.S. firms can easily make potentially very costly mistakes managing and paying their Canadian employees by inappropriately relying on erroneous practices and misinformation.
In Canada, small businesses have been identified as the greatest source of uncollected taxes, so the CRA is focusing its efforts on enforcing payroll tax policies for small businesses. There are over 190 regulatory legislative requirements when it comes to payroll processing in Canada.That is why many U.S. firms are hesitant to consider expanding into Canada due to the jurisdictional differences between the two countries.
If you own a small business, you can benefit from outsourcing payroll, HR services, and employee benefits to a dedicated company, so that you can focus on your core business. Trying to do it all by yourself has potential problems in payroll processing, since it can be complex, risky, and expensive if you make a mistake. Over 85% of certified public accountants recommend that small businesses employ the expertise of professional payroll providers. When you outsource payroll, there is only one report to approve and one invoice to pay.
A payroll provider can also offer HR Management, ESA and OHSA compliance and government remittances This is helpful since Payroll and HR management in Canada is very different than in the United States, due to very different laws and regulations. Because the business culture in Canada is so complex, you will require a payroll processing company that can also provide ongoing HR support, guidance and expertise when dealing with sensitive employment issues
As a business owner who manages payroll, you are tasked with responsibilities such as totaling hours, performing calculations for each employee, calculating and depositing payroll taxes, and preparing and filing tax returns accurately and on time. It can be very challenging for US based companies to ensure they are in Canadian compliance when paying their Canadian staff. Accounting and tax preparation can be particularly tricky for small business owners, who may have little experience with financial record keeping.
Particularly during tax season, small businesses will find that outsourcing payroll sources can be a time and cost saver. Before hiring Canadian workers in your small business, it is very important that you become aware of the business culture in Canada
