BC Employer Health Tax

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Diane Sawyer

Tax Question:

What is the BC Employer Health Tax (EHT) and am I required to remit?

Facts:

In a follow up to, the EHT is a new annual tax in BC based on your company’s payroll for the calendar year. This new tax commenced January 1, 2019.

Discussion:

If your payroll is less than $500,000 annually, then you are exempt from registering and paying the EHT but, if your payroll is greater than $500,000 in a calendar year then you are required to pay this tax as follows:

  • Payroll between $500,000.01 and $1,500,000 will be taxed at a rate of 2.925% but only on the payroll that exceeds the $500,000 exemption. The formula would be as follows: 2.925% x (Payroll—$500,000)
  • Payroll over 1,500,000 will be taxed at 1.95% for the total annual payroll

If you begin or cease to have a permanent establishment in BC during the calendar year then your exemption will be prorated.

Enrolment is through etaxBC. If you have a BC provincial sales tax (PST) # and are enrolled through etaxBC then you are registered for online services and just need to add your EHT account.

Instalments are required if your payroll exceeds $600,000 in a calendar year. If instalments are required then you must register for your account by May 15, 2019 otherwise registration can be completed by December 31, 2019. The first instalment will be due June 15, 2019.
The threshold for instalments is increased to $1,600,000 for charitable and non profit employers.

If you are an employer with associated companies, then you must look at the whole payroll for the associated groups.

Diane Sawyer
Tax Technician, Gilmour Group CPA’s
Email: faqs@gilmour.ca
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