Payroll Basics for Canadian Small Businesses: Deductions, Remittances and T4s
By Ravi’s Accurate Tax Services | Updated October 8, 2026
Payroll involves more than sending an employee their net pay. A consistent process helps you calculate deductions, remit the correct amount and prepare accurate year-end slips.
Set up before the first payment
Review whether the worker is an employee, register a CRA payroll program account when required, and collect the employee’s SIN and completed federal and applicable provincial or territorial TD1 forms. Keep the pay rate, pay frequency and employment details together. Calling someone a contractor does not determine their tax status.
Calculate each pay correctly
Payroll can require income tax deductions, Canada Pension Plan contributions and Employment Insurance premiums, with employer contributions as applicable. Use current-year CRA guidance or payroll software and review exemptions, taxable benefits and year-to-date maximums. A flat percentage of wages is not a reliable substitute for the required calculation.
Remit on your assigned schedule
The CRA must generally receive a regular remitter’s payment by the 15th of the month after employees were paid. Quarterly and accelerated remitters have different schedules and eligibility rules. Confirm your remitter type rather than assuming every employer has the same deadline. Track employee deductions and employer contributions in a separate reconciliation.
Prepare for year-end throughout the year
Reconcile payroll totals with payments and CRA remittances. T4 information returns are generally due by the last day of February following the calendar year, subject to the applicable next-business-day rule. Employees also need their slips by the deadline. Resolve discrepancies before filing.
Your payroll checklist
Keep employee setup forms, hours and pay records, taxable benefit details, deduction calculations, payment confirmations and remittance records. Notify your payroll preparer about new hires, departures and changes before the next pay run. Owner-manager remuneration may need a separate salary-versus-dividend review.
Need help keeping payroll organized? Call Ravi’s Accurate Tax Services at 647-300-1516 or 905-798-3785. We serve Canada except Quebec.
CRA sources:
General information; requirements depend on your employees, province of employment and remitter category.
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