Payroll services in Aldergrove

Paying yourself a salary is running a payroll

Owners often treat their own compensation as an internal transfer rather than as employment, and the informality is where the trouble starts. If the corporation pays you a salary, it is an employer and you are an employee: there must be a payroll (RP) program account, income tax and Canada Pension Plan contributions must be withheld from each payment and remitted on the CRA's schedule, and a T4 must be issued by the last day of February. The corporation also pays the employer's share of CPP. Money simply moved from the business account to a personal one during the year, reclassified as salary by a bookkeeper the following spring, produces a year of unremitted deductions rather than a tidy plan.

One genuine simplification applies to most owner-managers. Where you control the corporation, your own employment is generally not insurable for Employment Insurance purposes, so EI is typically not withheld on a controlling owner's salary — which also means no EI benefits arise from it. That is a trade worth understanding deliberately rather than discovering after a business interruption.

What salary buys, and what dividends do not

The salary-versus-dividend question is not answered by comparing tax rates alone, because the two routes buy different things. Salary is a deductible expense to the corporation, generates RRSP contribution room based on earned income, counts as pensionable earnings for CPP, and is the figure a lender looks at when you apply for a mortgage. Dividends are paid from after-tax corporate income, create no RRSP room, no CPP participation and no payroll obligations at all, and are reported on a T5 rather than a T4.

For an Aldergrove owner in their thirties building both a business and a personal balance sheet, the RRSP room and the CPP contributions usually matter more than they appear to on a one-year comparison. For an owner in their sixties who has already built retirement assets, they often matter less. There is no universal answer, which is exactly why the decision is worth revisiting each year against actual profit rather than being set once at incorporation. The interaction with provincial payroll tax matters too: salary counts toward BC remuneration for employer health tax while dividends do not, though a single-owner payroll sits far below the $1,000,000 exemption.

The small-payroll obligations that still apply

A one-person payroll is small, not exempt. The RP account still has to be opened and, if the salary stops, closed properly. Remittances still have due dates, and a first-time employer with no withholding history normally starts in the most forgiving remitter category, generally remitting by the fifteenth of the following month. The T4 still has to be filed on time. WorkSafeBC coverage is a separate question again — some owners of incorporated businesses are not automatically covered and choose optional coverage, which is worth a decision rather than an assumption. The RP account guide covers registration and remitter types.

What is handled

• Setting up the payroll account and the owner-salary structure
• Income tax and CPP calculated and withheld on each payment to you
• Remittances made on the CRA schedule assigned to the corporation
• Annual salary-versus-dividend review against the year's actual profit
• T4 slip and summary filed by the February deadline
• Coordination with the corporate return so the deduction and the slip agree
• T4 and T4A slips for any additional staff added later

Remote, with no Aldergrove office

EverStone operates from one office in Abbotsford — a short drive from Aldergrove, and still not somewhere you need to go. The engagement runs online: a video call to set the compensation plan, secure exchange for the documents, e-signature for approvals. For a one-person corporation that is the whole point, since the work is a handful of decisions and a monthly remittance rather than an ongoing administrative burden. The same CPA handles the corporate return, so the salary decision and the T2 are made in the same conversation rather than by two parties who never speak. See what it costs before you commit to anything.