You will need to keep information to support your 10% Temporary Wage Subsidy for Employers (TWS) calculation. The Canada Revenue Agency (CRA) may ask you to provide the following:
- total eligible remuneration paid from March 18 to June 19, 2020
- federal, provincial, or territorial income tax deducted from the remuneration paid
- Canada Pension Plan contributions (CPP), Employment Insurance premiums (EI) deducted from the remuneration paid
- total number of eligible employees employed from March 18 to June 19, 2020
Form required for reporting: PD27
Click the link for the: Form PD27 Use this form to reconcile the TWS on your payroll program (RP) accounts.
You need to complete and submit Form PD27 to the CRA if you are eligible to take advantage of the TWS and:
- you already reduced your remittances
- you intend to reduce your remittances (the form will help you calculate your eligible TWS amount)
- you claimed the Canada Emergency Wage Subsidy (CEWS) and, as a result, need to confirm on Form PD27 the amount of the TWS you are taking advantage of (refer to Line F of your CEWS application).
Submit the completed form to the CRA as soon as possible to avoid receiving a discrepancy notice at the end of the year. You do not need to wait until you file your T4 information return. It can be submitted by the following methods:
- online via My Business Account – scan and submit using “Submit documents”;
- mail: Winnipeg NVCC, 66 Stapon Road, Winnipeg MB, R3C 3M2; or
- fax: 204-984-4138.
If you were not eligible for the subsidy
The CRA will use information from your Form PD27 to reconcile the subsidy on your payroll program (RP) account(s). If you reduced your payroll remittances, but it is later determined you were not eligible for the TWS, the CRA will assess you for the income tax you deducted from your employees’ pay, but did not remit. This assessment may include penalties and interest.
Reporting the subsidy as taxable income
If you take advantage of the TWS, you must report the total subsidy amount as income on your tax return in the same year you reduced your remittances.