Payroll services in Vancouver

Province of employment decides the deductions, not the postcode of the employee

The rule that governs a distributed payroll is narrower than most employers expect. Source deductions are calculated using the tax tables for the province of employment, which is generally the province of the employer's establishment at which the employee reports for work — not the province the employee happens to live in. A person living in Burnaby who reports to a Vancouver office is a BC employee. Where an employee does not report to any establishment, the determination looks instead to the establishment from which they are paid.

That distinction produces two recurring Vancouver situations. The first is the cross-border commuter, which is straightforward once the rule is stated. The second is genuinely remote hiring, which is not: a fully remote employee in another province may, depending on the facts, be treated as employed at an establishment there, which can bring provincial income tax tables, provincial employment standards and provincial employer levies into play. It is a determination to make deliberately before the first pay run rather than to correct across a year of slips.

Employer health tax is charged on BC remuneration — and only BC remuneration

British Columbia's employer health tax measures BC remuneration. Wages paid to employees employed outside the province do not form part of it. For a Vancouver company with half its payroll in Ontario, that is a meaningful and often overlooked distinction: the BC total that has to be tested against the $1,000,000 exemption is the BC portion, not the consolidated wage bill. BC's bands are exemption up to $1,000,000, then 5.85% of the excess to $1,500,000, then 1.95% of total BC remuneration above that, as tabled on the BC facts page.

The corollary is that other provinces run their own regimes on their own bases, and they do not resemble each other. Ontario charges a graduated employer health tax where the rate is selected using total Ontario payroll before the exemption is applied. Manitoba runs a Health and Post Secondary Education Tax Levy with a far higher exemption. Alberta levies no employer payroll health tax at all. A single Canadian employer can therefore owe provincial payroll tax in one province, in two at different rates, or in none, entirely as a function of where its people report to work.

Employment standards do not travel with the employer either

Vacation entitlement, statutory or public holidays, and termination requirements are provincial. British Columbia accrues vacation pay at 4% of total wages after five calendar days and 6% after five consecutive years, and pays a qualifying statutory holiday as an average day's pay. Ontario recognises nine public holidays with its own calculation. Alberta and Manitoba each use different formulas again. An employer that applies one handbook nationally is, by definition, applying the wrong standard somewhere — and it is generally the termination provisions where that becomes expensive. Our guide to final pay on termination is a useful starting point before an out-of-province exit.

What the engagement covers

• Province of employment determined and documented for each hire
• Correct provincial tax tables applied to every pay run
• Federal source deductions calculated and remitted on your assigned schedule
• BC employer health tax on BC remuneration, plus any equivalent provincial levy elsewhere
• Workers' compensation registration and payroll reporting in each relevant province
• Records of employment reflecting the correct provincial rules
• T4 slips coded to the right province of employment, filed by the February deadline

Remote, from Abbotsford, with no Vancouver office

EverStone has no office in Vancouver and does not intend to open one. The practice runs from a single Abbotsford location and works with Vancouver employers entirely online — which, for a company whose own staff are distributed, is rarely a limitation and often the point. Video calls, secure document exchange and e-signature cover everything, and one CPA holds the file so the province of employment decisions made at hiring are the same ones reflected on the slips in February.