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June 2013 PADGETT BUSINESS SERVICES� Vol. 11, No. 6
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Greetings!
Tax season is just about over - small business owners (sole proprietors) have until midnight June 15th to file their 2012 personal tax returns.
We hope everyone is gearing up for a great summer. There will be an exciting announcement in our July 2013 Newsletter...until then!
Kate, Akash, Karin & Gerald (403) 452-8183
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This Business Owner Isn't
Calculating Her Payroll
Would you like to spend more time working on your swing instead of your payroll? We can help!
PayTrak Payroll Services offers a complete payroll service geared to small business. Our service is easy & convenient. It's sure to take the hassle out of your payroll administration and save you time. (403) 452-8183
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Canada Pension Plan Basics
The Canada Pension Plan (CPP) is a contributory, earnings-related social insurance program. It ensures a measure of protection to a contributor and his or her family caused by the loss of income due to retirement, disability and death.
There are three types of CPP benefits:
- Disability benefits (which include benefits for disabled contributors and for their dependent children);
- Retirement pension;
- Survivor benefits (which include the death benefit, the survivor's pension and the children's benefit).
The CPP operates across Canada, although the province of Quebec has its own similar program, the Quebec Pension Plan (QPP). The CPP and the QPP work together to ensure that all contributors are protected. With very few exceptions, every person in Canada over the age of 18 who earns a salary or a wage must pay into the CPP. You and your employer each pay 50% of the contributions. However, if you are self-employed you pay both portions.
You do not make contributions if you are receiving a CPP disability pension. At age 70, you stop contributing even if you are still working.
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Employment Insurance Benefits for Self-Employed People
 Self-employed Canadians are able to voluntarily access Employment Insurance (EI) special benefits. There are four types of EI special benefits: - Maternity benefits (15 weeks maximum) available to birth mothers. It covers the periods surrounding birth. A claim can be submitted up to 8 weeks before the expected date of birth;
- Parental / adoptive benefits (35 weeks maximum) available to adoptive or biological parents while they are caring for a newly adopted or newborn child. It may be taken by either parent or shared between them;
- Sickness benefits (15 weeks maximum) which may be paid to a person who cannot work because of injury, sickness, or quarantine; and
- Compassionate care benefits (6 weeks maximum), that may be paid to persons who have to be away from work temporarily to provide support or care to a family member who is gravely ill with a significant risk of death.
You are eligible to access the EI special benefits if you:
- Are a self-employed person or you work for a corporation but cannot access EI benefits because you control more than 40% of the corporation's voting shares; and
- Are a Canadian citizen or a permanent resident of Canada; and
- Have voluntarily entered into an agreement with the Canada Employment Insurance Commission through Service Canada.
Self-employed Canadians are required to voluntary opt into the Program at least one year prior to claiming benefits. Premium payments begin in the tax year in which they enrolled in the EI Program. Register to participate in the EI program through "my service Canada account."
Self-employed individuals need to have earned a minimum of $6,342 in 2013 of self-employed earnings to access the 2013 EI special benefits.
Self-employed persons can opt out of the EI Program at the end of any tax year, provided they have never claimed any benefits. If a claim for benefits was made they have to continue to contribute to the EI Program on their self-employed earnings for as long as they are self-employed.
Self-employed Canadians that opt into the EI Program will pay the same EI premium as salaried employees (maximum of $891 in 2013). She or he will not be required to pay the employer's portion of the EI premiums.
Self-employed residents of Quebec continue to receive maternity and paternal payments under the Quebec Parental Insurance Program. Self-employed Quebec residents can also choose to apply for the federal program mentioned above.
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 Padgett Business Services is dedicated to meeting the tax, government compliance, profit & financial reporting and payroll needs of businesses with fewer than 20 employees in the retail and service sector of the economy. This publication suggests general business planning concepts that may be appropriate in certain situations. It is designed to provide complete and accurate information to the reader. However, because of the complexities of the tax law and the necessity of determining whether the material discussed herein is appropriate to your business, it is important you seek advice from your Padgett office before implementing any of the concepts suggested in this newsletter.
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