New PD27 Form, Expanded T4 Reporting Requirements, and Upcoming Deadline for CEWS Claims

Written by Jolene Cashin, CPA, CA | Kenway Mack Slusarchuk Stewart LLP

With 2020 now behind us, employers should be aware of the PD27 10% Temporary Wage Subsidy Self -Identification required for eligible employers, the new T4 slip reporting requirements, and the upcoming deadline for the submission of the periods 1 to 5 Canada Emergency Wage Subsidy (CEWS) claims.

PD27 10% Temporary Wage Subsidy Self-Identification Form for Eligible Employers

The Temporary Wage Subsidy allowed eligible employers to reduce the amount of payroll deductions they remit to CRA by up to 10% of the gross remuneration for the pay dates occurring from March 18 to June 19, 2020, up to $1,375 per employee, up to $25,000 per employer. All eligible Canadian-controlled private corporations, eligible partnerships, non-profits, charities and individuals that either claimed or intend to claim the 10% Temporary Wage subsidy (“TWS”) or the Canada Emergency Wage Subsidy (“CEWS”) will be required to complete and submit Form PD27 to CRA.

Employers will be required to report the following information on their PD27 Form for the 3-month eligibility period:

• Total number of eligible employees employed
• Gross remuneration paid per pay period
• Income tax deducted
• CPP contributions (both employer and employee portions)
• EI premiums (both employer and employee portions)
• Wage subsidy claimed in dollars
• Wage subsidy claimed as a percentage
• An explanation as to which remittances were reduced or if the full subsidy has not been claimed an explanation of how the employer intends to reduce subsequent remittances or seek a refund

While there is no official deadline for submitting this form, we recommend that all eligible employers submit this form as soon as possible to avoid receiving a discrepancy notice upon filing T4 Information.

For more information on the PD27 Form or how your organization can still take advantage of this subsidy, please contact your KMSS advisor.

2020 T4 Reporting Requirements

All Canadian employers who issue T4 slips to employees must report certain employment payments during COVID-19, regardless of whether they have applied for Covid-19 related government programs or not. The new reporting requirements will help CRA validate payments made to individuals under the Canada Emergency Response Benefit (CERB), Canada Emergency Student Benefit (CESB), and payments made by employers under the Canada Emergency Wage Subsidy (CEWS).

For the 2020 tax year, in addition to reporting employment income in Box 14 or Code 71, the below information codes are to be used when reporting employment income and retroactive payments in the following periods:

• Code 57: Employment income – March 15 to May 9
• Code 58: Employment income – May 10 to July 4
• Code 59: Employment income – July 5 to August 29
• Code 60: Employment income – August 30 to September 26

Each period above pertains to the day employees were paid, not the period of work the payment covered. Example: If you are reporting employment income for the period of April 25 to May 8, payable on May 14, use code 58.

Upcoming CEWS deadline of January 31, 2021

The deadline for new applications and adjustments for the Canada Emergency Wage Subsidy (“CEWS”) is the later of January 31, 2021 or 180 days after the end of the qualifying claim period. This means that claim periods 1 through 5, covering the periods from March 15, 2020 to August 1, 2020 are due January 31, 2021.

If you require assistance with determining eligibility or submission of claims, please contact your KMSS advisor as soon as possible.

For further information regarding the COVID-19 Assistance for Alberta Small Businesses and the COVID-19 Assistance for Alberta Residents, please refer to our summaries on our Tax Tools page.