This spring, the federal government introduced the Temporary Wage Subsidy (TWS), followed by the Canada Emergency Wage Subsidy (CEWS), as part of its COVID-19 Economic Response Plan. The Canada Revenue Agency has now released a mandatory reporting form that must be filed by employers that claimed the TWS as well as those that claimed the CEWS only but were eligible for the TWS.
The TWS was a subsidy provided to eligible small businesses, charities and non-profit organizations of up to 10% on remuneration paid to employees between March 18, 2020 and June 19, 2020. Employers claimed the TWS by deducting from their remittance of income taxes to the CRA, up to a maximum of $1,375 per employee and $25,000 per employer.
On July 31, 2020, the Canada Revenue Agency introduced Form PD27, 10% Temporary Wage Subsidy Self-Identification Form for Employers. This form must be completed and filed by any employer that made a claim under the TWS program or was eligible for both the TWS and CEWS and only claimed the CEWS. Employers with more than one payroll program account must complete a separate form for each and submit them together. The CRA will be using these forms to reconcile employer payroll program accounts and avoid issuing discrepancy notices. Employers are advised to file by end of the calendar year to allow sufficient processing time and payroll program accounts to be updated before T4s are filed for 2020.
In cases where an employer was eligible for both subsidies and chose to only claim the CEWS either from the beginning or later on in the eligibility period, the employer is still required to submit Form PD27 and report a $0 and 0% TWS claim for the periods where the TWS was not claimed.
See the government's reporting guidance and download the form here.
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