Bill 188, Economic and Fiscal Update Act, 2020, received Royal Assent on March 25, 2020 and has been enacted as Chapter 5 of the Statutes of Ontario, 2020.
Schedule 1 of the Bill consists of the Employer Health Tax Act. This new Bill will have an impact on your payroll calculations for 2020. Please ensure you update your software to accommodate the new calculation. The Employer Health Tax Act allows eligible employers to claim an exemption amount when establishing their taxable total Ontario remuneration. This hasn’t changed, only the annual exemption amount has changed. Once this exemption is applied, the sum is used to calculate the amount of tax that is payable under the Act. Schedule 1 amends the Act to provide for an exemption amount of $1,000,000, replacing the previous $490,000, to be applied for the 2020 calendar year, Jan 1st to Dec 31st.
To view the rest of the Bill, please follow this link: https://www.ola.org/en/legislative-business/bills/parliament-42/session-1/bill-188
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The employer health tax underscores the importance of strategic tax planning for businesses of all sizes. Our dedicated consultants work collaboratively with clients to develop customized approaches that align with their long-term objectives.