Legislative roundup: Changes in payroll laws and regulations from across Canada

CPP, OAS benefit rates on the rise for 2012 • Payroll deductions tables available on CD • 2012 indexation adjustment for personal income tax and benefit amounts • CRA releases interest rates for amounts owing in first quarter 2012 • No increase in Manitoba’s average WCB assessment rates • QST rate increased

Canada

CPP, OAS benefit rates on the rise for 2012

Human Resources and Skills Development Canada (HRSDC) has announced the benefit rates for the Canada Pension Plan (CPP) and Old Age Security (OAS), effective Jan. 1, 2012. CPP benefits will increase by 2.8 per cent for those already receiving CPP benefits. CPP benefits are revised once a year, in January. The revisions are based on changes over a 12-month period (November 2010 to October 2011) in the consumer price index (CPI), which is the cost-of-living measure used by Statistics Canada.The maximum CPP retirement benefit for new recipients will increase from $960 to $986.67 per month. This increase is calculated based on the average yearly maximum pensionable earnings for the last five years. The new CPP rates will be in effect until Dec. 31, 2012. The basic OAS pension, the Guaranteed Income Supplement and the Allowances will increase by 0.4 per cent. These payments are also based on the CPI but are reviewed quarterly (in January, April, July and October) and are revised as required to reflect increases in the cost of living as measured by the CPI. The maximum basic OAS pension will increase from $537.97 to $540.12 per month. The Guaranteed Income Supplement (GIS) and the Allowances provide additional income to low- income pensioners, their spouses or common-law partners, and eligible survivors. Since July 1, 2011, these beneficiaries also receive a GIS and Allowances top-up benefit of up to $600 for single seniors and $840 for couples per year. This top-up will also be indexed and is included in the GIS and the Allowances rate. Although OAS and CPP benefits are not indexed at the same time, they are both adjusted with the cost of living over a given year.

Payroll deductions tables available on CD

Starting in January 2012, publication T4032, Payroll Deductions Tables, will be available on CD for use on any com- puter with or without Internet access. Paper copies remain available for employers who do not use a computer, according to the Canada Revenue Agency (CRA). The CD and paper versions of publication T4032 will be available at the end of December 2011. As of Dec. 15, 2011, the online versions of publication T4032 will be available at http://www.cra-arc.gc.ca/payroll. The new online structure will make it easier to navigate through the docu- ment and print only the information needed, said the CRA. The T4032 online version will be laid out in a pay period format. To order a copy of the CD or a paper version of the T4032 at www.cra.gc.ca/orderforms or by calling 1-800-959-2221.

2012 indexation adjustment for personal income tax and benefit amounts

The Canada Revenue Agency (CRA) has released the indexation adjust- ment for person income tax and benefit amounts for 2012. Each year, certain personal income tax and benefit amounts are indexed to inflation using the consumer price index data as reported by Statistics Canada. Increases to tax bracket thresholds, amounts relating to non refundable credits, and most other amounts will take effect on Jan. 1, 2012. Increases to the Canada child tax benefit (includ- ing the national child benefit supplement and the child disability benefit) and the goods and services tax (GST) credit will take effect on July 1, 2012. This coincides with the beginning of the program year for payment of these benefits.

CRA releases interest rates for amounts owing in first quarter 2012

The Canada Revenue Agency (CRA) has released the prescribed annual interest rates that will apply to any amounts owed to the CRA and to any amounts the CRA owes to individuals and corporations in the first quarter of 2012. The rates are calculated quarterly in accordance with applicable legis- lation and will be in effect from Jan. 1 to March 31, 2012. The interest rate charged on overdue taxes, Canada Pension Plan (CPP) contributions andemployment insurance premiums will be five per cent. The interest rate to be paid on corporate taxpayers overpayments will be one per cent. The interest rate to be paid on non corporate taxpayers overpayments will be three per cent. The interest rate used to calculate taxable benefits for employees and shareholders from interest-free and low-interest loans will be one per cent.

Northwest Territories and Nunavut

N.W.T., Nunavut WCB set 2012 premium rate, maximum insurable earnings

The Workers’ Safety and Compensa- tion Commission of the Northwest Territories and Nunavut has set the 2012 premium rate and maximum insurable earnings for the two territories. The average provisional rate for 2012 has been set at $1.77 per $100 of assessable payroll. The 2012 maximum insurable remuneration in the jurisdiction has been set at $82,720. A 28-page rate guide, outlining the rates for each class and industry, is available online at http://www.wscc.nt.ca/Documents/English%20Guide%20%20FINAL.pdf.

Manitoba

No increase in Manitoba’s average WCB assessment rates

The average WCB assessment rate in Manitoba will remain stable at $1.50 next year, according to the Workers Compensation Board of Manitoba. Manitoba employers will not see an increase in the average assessment rate in 2012. They will pay an average of $1.50 per $100 of assessable payroll to the WCB for injury insurance coverage, including wage loss payments, medical benefits and rehabilitation services. The employer’s own rate may be higher or lower than average, depending on their injury experience and the safety and health risk of their industry. Last year, the WCB average assessment rate decreased from $1.60 the year before. The rates had previously held steady at $1.60 since 2008. Overall, about 39 per cent of employers will pay lower WCB assessment rates in 2012, while 12 per cent will pay more and 49 per cent will not see a change in their rates. Those employers who had the largest declines in their injury experience benefited the most, according to the WCB. In 2011, Manitoba had the second lowest workers compensation assessment rates in the country. The maximum assessable earnings in 2012 will be set at $104,000.

Quebec

QST rate increased

Effective Jan. 1, the Quebec Sales Tax (QST) rate increased from 8.5 per cent to 9.5 per cent. As a result, the combined goods and services Tax (GST)/QST rate rose from 13.92 per cent to 14.97 per cent on Jan. 1. The prescribed rate employers use to cal- culate the QST on automobile operating expense benefits increased from 5.4 per cent to 6 per cent, as of Jan. 1.

New Brunswick

Amendments proposed for reservist leave

Proposed amendments to the reservist leave standards in the Employment Standards Act would expand the leave to cover all reservists and would allow employers to apply for an exemption if the leave would cause hardship. The proposals are in Bill 7, An Act to Amend the Employment Standards Act. It was introduced in the provincial legislature on Nov. 30, 2011. At press time, the bill had not yet become law. The bill would remove a current restriction that limits reservist leave to Class C reservists, resulting in all classes of reserves to be eligible for reservist leave. It would also allow employers to apply to the director of employment standards to request an exemption from an employee’s request for reservist leave or an extension of a leave if the leave would adversely affect the health or safety of the workplace or the public or would cause the employer undue hardship. The bill includes new provision allowing for time off without pay for annual training would be added to the Act. Employees employed by their employer for at least six months would be eligible for a leave for a continuous period of up to 30 days in a calendar year for annual training. The time off for annual training would include the period of time that a reservist would need to travel to take part in the training. Employers would not be required to extend an employee’s leave beyond the date that would result in the employee’s total period of reservist leave going beyond 18 months. The bill would also revise notice requirements and expand the definition, among other changes.

Newfoundland and Labrador

N.L. employers can spread WCB payments throughout the year

The Workplace Health, Safety and Compensation Commission (WHSCC) of Newfoundland and Labrador is introducing an enhanced deferred payment plan which will allow all employers to spread payments throughout the year, interest-free. Starting in 2012, all eligible employers will be able to spread equal payments over the calendar year, according to the WHSCC. The period from January to March is payment-free for new assessment bills. For the remaining nine months employers may set up equal payment plans using pre-authorized debit. Employers can choose their assessment payment interval as weekly, bi-weekly, semi-monthly, monthly or quarterly.

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