Canadian Payroll Reporter

JANUARY 2014 RPP, RRSP contribution limits rising Continued from page 1 for reporting amounts on the T4A: • Code 136 — Federal income support for parents of murdered or missing children grant (PMMC) • Code 162 — Pre-1990 past service contributions while not a contributor • Code 194 — Pooled registered pension plan (PRPP) annuity payments from taxable income • Code 195 — Indian (exempt income) – PRPP payments T4061 guide: NR4 – Non-resident tax withholding, remitting, and reporting: The CRA has added two new income codes to the NR4 related to pooled registered pension plans (PRPPs): • Code 65 PRPP – Periodic payments • Code 66 PRPP – Lump-sum payments Temporary EI hiring credit for small business extended by one year The federal government has extended the temporary EI hiring credit for an additional year. If an employer's shares of EI premiums were $15,000 or less in 2012 and the premiums for 2013 have increased, it will be eligible for a refund of the difference up to $1,000. Employers are not required to do any calculations as the CRA will do the reconciliation on the employers' behalf. Reduced EI premium rates set for 2014 Service Canada has released the reduced EI premium rates for 2014 for employers with registered wage-loss replacement plans. For 2014, the following rates apply: • category 1 plans: x 1.283 the employee premium (1.256 for Quebec employees) • category 2 plans: x 1.219 the employee premium (1.178 for Quebec employees) • category 3 plans: x 1.219 the employee premium (1.178 for Quebec employees) • category 4 plans: x 1.203 the employee premium (1.158 for Quebec employees) The category refers to the group to which Service Canada assigns the employer, based on the type of wage-loss replacement plan the employer has set up. 2 RPP, RRSP limits change The maximum contribution rates for 2014 for registered pension plans and registered retirement savings plans will increase: • money purchase plans — $24,930 • deferred profit-sharing plans — $12,465 • RRSPs — $24,270 • defined benefit (DB) plans — $2,770 Agency name change Human Resources Skills and Development Canada (HRSDC) has changed its name to Employment and Social Development Canada (ESDC). This government agency is responsible for the administration programs of Canada Pension Plan (CPP), Old Age Security (OAS) and EI benefits. This change does not affect the way employers should continue to conduct business with the agency. PROVINCIAL UPDATES Medical services premiums rise in B.C. Effective Jan. 1, British Columbia will increase its monthly medical services plan (MSP) premium rates for a single person to $69.25 from $66.50. The maximum monthly premium for a family of two will increase from $120.50 to $125.50. For a family of three or more, it will rise from $133 to $138.50. Newfoundland and Labrador minimum wage increasing The province's minimum wage rate will increase from $10 per hour to $10.25 on Oct. 1, 2014. QUEBEC UPDATES 2014 QPP rates The Quebec Pension Plan (QPP) rates and maximum for 2014 are as follows: • Maximum pensionable earnings — $52,500 • Basic exemption — $3,500 • Maximum contributory earnings — $49,000 • Contribution rate (employee and employer) — 5.175 per cent • Maximum employee contribution — $2,535.75 • Maximum employer contribution — $2,535.75 Effective Jan. 1, Quebec is also changing the method employers use to deterCanadian HR Reporter, a Thomson Reuters business 2014 mine the maximum QPP contribution to deduct from employees transferred to Quebec from another part of Canada who were covered under the CPP. The change is necessary to deal with the fact QPP and CPP have different contribution rates. Beginning next year, employers who transfer employees from another part of Canada to Quebec will have to multiply the total CPP contributions they deducted from the employees since the start of the year by a weighting factor. The weighting factor will be determined by dividing the QPP contribution rate for the year (5.175 per cent for 2014) by the CPP contribution rate for the year (4.95 per cent for 2014). For 2014, the weighting factor will be 1.0455. What's new (forms and guides) for 2013 year end • Employers filing on paper (those with 50 or fewer RL-1s to file) must now only send copy 1 of the RL-1 to Revenu Québec and give copy 2 to the employee. • Revenu Québec has added new code CD to the list of codes used in the Box (O). The new code is used to report federal benefits paid to the parents of children who are missing or murdered. • Beginning with 2013 year-end reporting, employer must not include the following amount from box (A) when completing box (G) on an RL-1; the value of a benefit resulting from amounts an employer paid to acquire a share (or a part of a share) for an employee from the Fonds de solidarité FTQ or Fondaction period. Because the benefit is pensionable, the employer must inform the employee that he may make optional contributions to the QPP on the value of the benefit when filing a personal tax return, provided the employee has not reached the annual maximum. Also, on the RL-1, enter "G-1" in one of the blank boxes in the centre of the RL1followed by the amount. Quebec legislation to enact VRSPs Legislation that would implement voluntary retirement savings plans (VRSPs) in Quebec beginning Jan. 1, is still being considered by the Quebec's Continued on page 7

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