Notice Updated Nov 12, 2020
The Government of Canada recently announced the Canada Emergency Wage Subsidy (CEWS). Businesses, non-profits and charities not eligible for CEWS can continue to use the Temporary Wage Subsidy for Employers (TWSE) program.
Please note that the TWSE program has now ended. You are required to submit for PD27 to CRA to report your TWSE amounts. See Section PD27 - Reporting the Temporary Wage Subsidy to CRA below for what you will need to complete this.
The Temporary Wage Subsidy for Employers (TWSE) program helps businesses impacted by the COVID-19 pandemic reduce the amount of payroll deductions to be remitted to the Canada Revenue Agency (CRA).
PaymentEvolution provides support for calculating and applying this subsidy to your payroll profile. This feature is available on any paid plan with ePay and remittance services activated.
Please check the CRA site to determine eligibility for the subsidy
How to activate the Temporary Wage Subsidy for Employers feature
This feature is available on the following plans:
|Green||Business||Accountant Starter||Business||Accountant Pro||EVOLV E1, E3, E5|
ePay and remittance services must be active
To activate the Temporary Wage Subsidy for Employers feature, perform your pay run and on the Payments step, click the TWSE button
The subsidy will be automatically calculated based on the CRA's posted guidance and it will show as a line item on your Payments pageNote: If no income tax is withheld during the run, there will be no subsidy calculated. If you are eligible, you may file a year-end claim to receive any applicable subsidy.
How to deactivate the Temporary Wage Subsidy for Employers feature
Go to SETTINGS>PAY RULES>COMPANY RULES and un-check the box for this feature, then click SAVE
Specific reporting for the TWSE is found on the General Ledger and Remittance Reports. These reports can be created by going to ACTIONS>END OF PERIOD after each pay run.
Full details can be see on the PDF of the report
The GL Report shows a credit to Fed Tax Liability and a debit to Bank/Payroll Clearing.
The Remittance Report has a line entry for the deduction:
The Pay Run History Report will show the amount of remittance for each pay run (with the subsidy already included)
Employers who took advantage of the 10% Temporary Wage Subsidy need to file a PD27 to report the amounts to CRA. It is strongly encouraged by CRA that you file the PD27 (self-identification form) before year end. The self-identification form will allow CRA to reconcile your T4s and T4 summary with the amounts they have received. Failure to file this form could result in penalties from CRA.
Go HERE for more information: https://www.canada.ca/en/revenue-agency/services/subsidy/temporary-wage-subsidy/tws-reporting.html
Go HERE for the form: https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/pd27.html
How to fill in the form (Part D)
Total number of eligible employees employed March 18 to June 19, 2020
To fill this in go to REPORTS>DYNAMIC REPORT and enter the following criteria:
- Dates= March 18-June 19, 2020
- Select by Pay Date
- Employee Status= ALL
- Report Type = General
- Click Search
- Count up the number of employees who were paid in this time period (even if they were only paid once)
Pay Period/ Deductions and Contributions Section
If you activated TWSE in your account: Use the *NEW Payrun History Report>Report Type: Temporary Wage Subsidy -From March 18 to Jun 19 2020 (available Nov. 13, 2020)
The report will auto generate the amounts held back from the pay runs for payments within the March 18-June 19 timeframe.
Use the fields in the report to file your PD27
*Remittance Gross is the Gross Remuneration per pay period
*If PaymentEvolution did not hold back your remittances you can still use this report. You will need to manually fill in the amounts claimed ($ and %).
If you were unable to take the full 10% amount you can add additional comments on your PD27 as to why, and what you would like to do about it.
Examples of explanations:
I did not take full 10% because I used CEWS instead
I was unable to reduce future remittances because (include reason) and did not take the full 10% which should be $$$$. Please return $$$$ to me.
If your plan does not give you access to this report you can run Dynamic Reports for EACH pay period that had a payment date between March 18 and June 19, 2020.
*Hint- review your Payrun History report for which pay runs had payment dates within the timeframe allowed for TWSE
Run a report for EACH pay period by using the following settings
- Use Start/End Dates
- Employee Status- ALL
- Report Type- General
- Click to Show Company Portions
Enter the details for each pay period in your PD27 report (you will need to add some of the tax fields together) and manually include amounts you held back for $ and % claimed.
Frequently Asked Questions
What is the Temporary Wage Subsidy for Employers?
On March 18, 2020 the Canadian Federal Government announced the Temporary Wage Subsidy for Employers program. Eligible employers may reduce their remittance payments to the CRA for remuneration paid to their employees between March 18, 2020 and June 20, 2020. The subsidy is equal to 10% of the remuneration paid during this period, up to $1,375 per employee and to a maximum of $25,000 (total) per employer.
Who is eligible for the program?
The CRA site provides details on eligibility. You must determine if you are eligible before activating this feature in your payroll profile.
Will PaymentEvolution automatically reduce remittances for me?
If you activate the feature, the subsidy will automatically be calculated for you on each subsequent pay run. If you reach the subsidy's limits (monetary or the date period covered), calculations will automatically adjust and stop. The amount remitted to the CRA as part of the ePay and remittance service will be adjusted according the the subsidy calculations.
What if I ran payroll before activating this feature?
Any pay runs performed before you activate TWSE will not be adjusted. If subsequent pay runs do not reach the subsidy's limits, you may request the balance of the subsidy to be paid to you at year end. You must make this request directly with the CRA.
What if I don't activate the feature?
If you do not activate the feature, or activate the feature part-way through the eligible period, you can ask for the subsidy to be paid to you at the end of the year (after filing your year-end T4 slips). You must make this request directly with the CRA.
What if my business is closed or I don't pay staff during this period?
If you did not pay remuneration to an employee during the eligibility period, you cannot receive the subsidy.
What if I deactivate the ePay remittance service and handle remittances manually?
The TWSE feature is only available on paid plans with active ePay and remittance services. Calculations of the subsidy will only take place if PaymentEvolution is handling remittance payments to the CRA for you. If you handle remittances manually, you will need to calculate the subsidy manually.
Will this affect my Revenu Québec remittances?
The TWSE program is only for remittance payments made to the CRA.