CRA Payroll Remittances: Deadlines, Rates, and What Happens If You Miss One
Source deductions are the CRA's highest-priority debt. Here's what you owe, when you owe it, and exactly how to avoid the penalties that catch small businesses off guard.
Payroll source deductions are unlike any other business obligation. Amounts you withhold from employee pay are deemed by law to be held in trust for the Crown — the CRA treats them as its money from the moment you withhold them, not as an ordinary business debt. Directors of corporations can be held personally liable for unpaid source deductions, even after the corporation is dissolved.
That's not to scare you, just to explain why this category deserves more attention than most business owners give it.
What you're remitting
Every pay period, you must withhold three things from employee pay and remit them (plus employer contributions on two of them):
Canada Pension Plan (CPP)
- Employee portion: a percentage of pensionable earnings above the basic exemption ($3,500/year), at the contribution rate the CRA sets each year
- Employer match: equal to the employee's CPP contribution (i.e., you pay double)
- Since 2024 there is also a second CPP contribution (CPP2) on earnings between the year's first and second earnings ceilings — your payroll software should handle it, but it's worth knowing it exists
- The earnings ceilings and rates change every January — always confirm the current year's figures on the CRA's CPP contributions page
Employment Insurance (EI)
- Employee portion: a percentage of insurable earnings, at the premium rate set each year
- Employer portion: 1.4× the employee's EI premium
- Maximum insurable earnings also reset every January — current figures are on the CRA's EI premiums page
Federal and Provincial Income Tax
- Withheld based on the employee's TD1 form (personal amounts and credits claimed)
- No employer match, you remit exactly what was withheld from the employee
Remittance schedules
The CRA assigns you a remittance schedule based on your average monthly withholding amount (AMWA) from two calendar years ago:
| Avg. monthly withholding | Remittance type | Due date |
|---|---|---|
| Under $25,000 | Regular | 15th of the following month |
| $25,000-$99,999 | Accelerated Threshold 1 | Pay dates 1st-15th: due the 25th of the same month. Pay dates 16th-end: due the 10th of the following month |
| $100,000+ | Accelerated Threshold 2 | Within 3 working days after the end of the weekly period containing the pay date |
New employers start as Regular remitters. Very small employers (AMWA under $3,000 with a clean compliance record) may qualify to remit quarterly instead — the CRA will tell you if you're eligible.
Important: Your schedule is based on what you owed two years ago, so a growing business may move up a tier before they realize it. Check your CRA My Business Account to confirm your current category.
How to remit
- Online via CRA My Business Account, fastest and most reliable. Use "Make a payment" → "Payroll deductions"
- Online banking, add the CRA (Business, Payroll deductions) as a payee; use your business number + "RP0001" as the account
- At your bank in person, use the remittance voucher from your payroll register
Always include your Business Number and the tax year and period covered in your remittance. Misapplied payments are frustratingly common.
Penalties for late or short remittances
The CRA is not lenient here:
| Days late | Penalty |
|---|---|
| 1-3 days | 3% of amount owing |
| 4-5 days | 5% |
| 6-7 days | 7% |
| 8+ days | 10% |
| Repeat offence (second+ time in a year) | 20% |
Plus interest at the CRA's prescribed rate for overdue amounts, compounded daily.
Illustrative example: A $15,000 remittance that's 10 days late = $1,500 penalty + interest. That's on top of whatever staffing error caused the delay.
T4 slips: your year-end obligation
By the last day of February following the calendar year, you must:
- File T4 slips with the CRA for every employee who received employment income
- Provide a copy of the T4 to each employee
The T4 summarizes the full year's employment income, CPP, EI, and income tax for each employee. If you use payroll software (QBO Payroll, Wagepoint, Payworks), this is generated automatically. If you're doing it manually, use the CRA's online T4 filing tool.
Record of Employment (ROE)
When an employee has an interruption of earnings — generally seven consecutive calendar days with no work and no insurable earnings (resignation, termination, layoff, or an extended leave) — you must issue an ROE. Filed electronically, it's due within 5 calendar days after the end of the pay period in which the interruption occurs. ROEs are filed via Service Canada's ROE Web, not the CRA.
Payroll compliance has zero-tolerance margins, and the rates, ceilings, and deadlines above change — always confirm the current year's figures directly with the CRA. If your current setup makes you uncertain about any of the above, talk to us, payroll is one of the areas where getting a second opinion before something goes wrong is genuinely worth it.
This article provides general information for Canadian businesses, not professional accounting, tax, or legal advice, and reading it does not create a client relationship with Quipusol. Rates, thresholds, and deadlines change — confirm current requirements with the CRA or a qualified professional before acting. Figures are current as of the publication date above. See our Terms & Conditions.
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