TAX YEAR 2020 - CRA New T4 reporting requirements for Employers

Question

CRA is now requiring employers to report the income of employees during the COVID-19 pay periods on their T4 Slips or Statement of Remuneration Paid so that CRA can validate payments made to workers under the Canada Emergency Response Benefit (CERB) . 
 For the tax year 2020, CRA requires to use new other information codes when reporting employment income for the following periods: 
 
 Code 57: Employment income &ndash; March 15 to May 9 
 Code 58: Employment income &ndash; May 10 to July 4 
 Code 59: Employment income &ndash; July 5 to August 29 
 Code 60: Employment income &ndash; August 30 to September 26 
 
 Is there a way that Sage can include the above additional codes on T4 slips and automate the calculation of employees&rsquo; income on the aforementioned pay periods? 
 Our company is using Sage 50 Pro Accounting (Release 2020.2) and we have about 400 employees. An automation of this additional requirement on employees&rsquo; T4s for the tax year 2020 would be of great help. 
 Thank you!

Erzsi_I · Accepted Answer

Yes, I received the following 30 minutes ago from the product team who expects the CRA to announce further changes in the next few months: 
 As a result of government COVID-19 programs, some changes for T4 reporting at the end of the year were expected. In addition to the usual updates in payroll tax tables and payroll forms, the Sage 50 product team was, and is, committed to making changes required for COVID-19 reporting. The Sage 50 team is currently reviewing how these new requirements will be supported. It is expected that the customers can continue as they have without making changes to their payroll. In addition to reporting employment income in Box 14, Sage 50 will likely automatically report the income paid in the separate periods as separate codes as is required. Customers will be expected to update to the latest version (which will be Sage 50 2021.1 ), to print and report their 2020 T4&rsquo;s as the functionality for the new codes will likely not be added to the Sage 50 2020.3 tax table update.

Alwyn · Answer

My thoughts are that the reporting in the box is based on the date of the payment. What they are trying to trace is related to CERB. Did the employee receive more than the $1,000 in the Period? Did they report the correct payments received when they applied for CERB? The date of payment is also the trigger for reporting on a T4 when it comes the beginning or end of the year. If the pay date is January 2nd it is report in that year not when earned. I also have an employer who pays on the 15th of the month for the full month, however, in March 2020 the 15th was a Sunday so the payment was made on the 13th paying to the end of March. When I checked with CRA regarding the TWSE they advised that the date of the check is the trigger, not the period being paid. Similar situation here is my take. 
 This reporting has nothing to do with CEWS which is based on earnings.

Jo Ruelle · Answer

You have just opened one nasty can of worms. I rather suspect, if group life insurance has been continued for the laid-off employee and said employee still has use of the company vehicle, these would be considered part of the remuneration for the relevant periods. These would affect the 10% subsidy only in that they might raise the employee above the maximum and so limit the amount of the subsidy. I used Exel to track the employees where doing this as had a few max out. 
 I do know that the Canadian Payroll Association strongly urges employers to include taxable benefits on each pay statement where at all possible. Group benefits such as life insurance are relatively easy to do within Sage though, again, I do have s/sheets as backup. For the auto standby, my recollection is that an estimate is put on each paycheque with a final reconciliation at year-end. This way, the proper calculations can be made for CPP, EI, and FIT. If an employee maxes out on EI and CPP anyway, it's not so crucial except where FIT deductions are concerned, and this can be rectified by taking additional FIT on each paycheque. 
 I do include taxable benefits on each paycheque for my clients. Don't happen to have any auto standby charges - for which I am profoundly grateful - but strongly recommend you get going with s/sheets in the event you do have to go back and adjust those periods. If - as is possible - that involves a prior year, the client's accountant will need to be involved as well. 
 Good luck.

SharonBookkeeper · Answer

Unfortunately I am currently using Sage Business Vision ( didn't notice this group was Sage 50 ). Nonetheless our payroll program updates for Jan 1/21 included the new T4 requirements and Sage Business Vision included all GROSS earnings along with the taxable benefits in boxes 57 - 60. Not sure who's right or wrong here..... T4 Box 14 is for Employment income which is gross earnings not net payable as is the case with boxes 57-60 I'm fairly certain

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TAX YEAR 2020 - CRA New T4 reporting requirements for Employers

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