B.C. Employer Health Tax now in effect
Find out how to calculate the new EHT for your payroll
The Employer Health Tax is now in effect. Employers with a payroll of more than $1.5 million in British Columbia will pay a rate of $1.95% on their total payroll. Lower rates apply to employers with lower payrolls. Employers with payroll of less than $500,000 are exempt from paying the Employer Health Tax. Employers with payroll between $500,000.01 and $1,500,000 pay a reduced tax rate, calculated as 2.925% x (B.C. payroll minus $500,000).
Employers can calculate their tax payable here. Those who would have paid more than $2,925 in employer health tax (EHT) for the previous calendar year must register by May 15, 2019 and must pay the EHT in quarterly instalments, the first of which must be paid by June 15, 2019. Employers who would have paid less than $2,925 must register by December 31, 2019 and can choose to pay in instalments or make one payment when you file your employer health tax return for March 31, 2020.
The EHT is deductible from business income for income tax purposes.
Background
Government announced the employer health tax in their 2018 Budget. RCC has strongly opposed the tax, particularly the 13-month “double-dip” period from January 2019-January 2020 where employers who pay their employees’ MSP premiums will be double paying both MSP premiums and the EHT. The “double-dip” period is 13-months as MSP premiums are collected a month in advance, meaning employers will have to pay premiums for January 2020 in December 2019.
Next Steps
If you have any questions or concerns, please don’t hesitate to contact: Avery Bruenjes, Policy Analyst, Government Relations and Regulatory Affairs at abruenjes@retailcouncil.org or 604-736-0368. [Si vous avez besoin de cet avis en français, svp communiquez avec nous pour plus de détails.]
