Top Small Business Payroll Tax Season Questions Answered (Canada)

Sometimes, you just need a straight answer to a payroll question that doesn’t sound like an accounting textbook (no offence, accounting textbooks). So, to empower you with the knowledge and confidence you need to tackle tax season for your small business, we’ve done the digging and teamed up with Wagepoint’s friendly payroll tax experts — they’re basically wizards — to solve your toughest payroll mysteries.

Whether you’re looking to avoid costly mistakes or just want to cross tax season off your list without getting a finance degree, Canadian employers can count on these answers to make tax time, well, a little less taxing. 

Filing your company’s payroll tax forms

How do I file my 2024 tax forms (T4s, T4As, RL-1s)?

The filing process is entirely up to you. You have two options for submitting your forms to the Canadian government — electronic and manual. 

Electronic filing is the easiest and most efficient way to file. Using a payroll software with built-in filing, like Wagepoint, will save you time and reduce the risk of errors. Tax forms are generated using your existing payroll data, so as long as your payroll records for the current year are accurate, so should the forms. 

Manual filing is exactly as it sounds (tedious), but may be a good option if you’re submitting fewer than 5 slips. You’ll need to do this by hand, mailing them to the correct Canada Revenue Agency (CRA) tax centre and allowing extra time for delivery before the deadline. So make sure you have the right address! Similarly, employers in Québec can print and manually send the RL-1 Summary to Revenu Québec (RQ). 

When are tax forms due to the CRA?

The deadline for filing and distributing tax forms to your employees is February 28, 2025. This includes past, existing, and new employees. 

For Québec employers, the deadline for the Revenu Québec office to receive your RL-1 forms and summaries is also February 28, 2025. 

Who should get a T4A?

You’ll need to file and issue a T4A, also known as a Statement of Pension, Retirement, Annuity and Other Income, to any of your contractors and other self-employed workers that you have paid $500 or more (before taxes) during the prior year. These do not include construction (sub)contractors, who get a form T5018 instead. 

Which box on the T4 do I use to report an employee’s contribution towards their Registered Retirement Savings Plan (RRSP)?

The answer might surprise you: You don’t use a box! An employee’s RRSP contribution does not get reported on their T4. Only the employer contribution does, using Boxes 14 (Employment Income) and 40 (Taxable Benefits). 

I paid my employee for a pay cycle ending on December 31, 2024. Why isn’t this reported on their 2024 T4?

It’s a bit of a payroll plot twist. Although the pay cycle ended in 2024, the pay date likely occurred in the next year, making this a 2025 payroll. T4s are generated based on when the dollars are paid to the employees, not when the hours were worked. 

What dental code should I use in Box 45?

Box 45 (Employee-Offered Dental Benefits) is still relatively new. For tax periods starting in 2023, you need to indicate whether each of your employees and their family members were eligible for employee-offered dental benefits on December 31 of that year. 

Here are the main codes you can use: 

For information on how to handle more complex scenarios, search for “Box 45” in this government-provided article. It’s a great way to learn more! 

Filing tax forms for terminated employees

Do I need to file tax forms for terminated employees?

Yes. You’re legally required to file and distribute T4s and other relevant tax forms to active and inactive employees from the past year. 

Why is my former employee’s severance pay not reflected in Box 14 (Employment Income)?

Severance pay is also considered a retiring allowance by the CRA. While it’s subject to income taxes for the year, it does not get reported in Box 14. You’ll need to report it to Box 66 if it’s eligible to be transferred to an RRSP or Box 67 if it’s not eligible to be transferred to an RRSP. 

“I’ve been asked this question at least 10 times in just January!” 

– Melissa Whitwham, Payroll Support Team Lead, Wagepoint 

Making changes to tax forms

How can I make corrections to an employee’s T4?

It depends on how and when you filed the T4. 

If you filed electronically using payroll software and it’s before the February 28 CRA deadline, it’s likely that you can edit the forms right in the app with a few clicks. After that, you may need to request an amendment from your payroll company for a small fee. 

If your software doesn’t support amendments or you filed manually, you’ll need to correct the T4 through the CRA. This process involves submitting amended or cancelled slips, which can take more time.

For clear steps and instructions, check out the CRA’s comprehensive guide, here. 

Staying compliant with the CRA

Do I need to send tax forms to my employees, or does the CRA handle that?

It’s on you. As a Canadian employer, you are responsible for making sure your employees (active and terminated) get a copy of their tax forms so they can take care of their tax returns. If you’re using a payroll software like Wagepoint, the forms upload directly to employee payroll portals, where they typically view their pay stubs, making distribution a breeze.

Why did I receive a Statement of Account from the CRA in 2025? Does this mean I owe money?

A Statement of Account from the CRA is a summary of all the charges and payments recorded in your CRA account. It also shows your current balance.

You can check your statement anytime through the CRA website (“My Account” portal) or opt to receive it by mail. While the CRA usually sends these out in November, some businesses may have received theirs later than usual (December 2024 or January 2025) due to the Canada Post strike.

Getting a letter doesn’t automatically mean that you owe money. To check your balance, look at Page 2 of your letter (this was on Page 1 in previous years). 

If the balance is a credit, no action is needed. Your deduction remittances have been applied but not yet reconciled against T4s. Once they are, the balance should zero out.

If the balance is a debit, it means that remittances have not been sent (think of it like a missed payment), and there is an outstanding balance. You should review your account and contact the CRA via email or phone if you need any clarification.

What penalties can I face for filing T4s late?

Fines are calculated based on the number of returns, and how late they are. The minimum fine is $100. 

If you’re late to pay any amount owing to the CRA, they can apply interest starting the very day the payment was due. The CRA updates their interest rate every quarter and interest is compounded daily.

For more information, check out the “Late Filing Penalty” section of this CRA guide.

More tools for a smoother tax season

Payroll tax season can feel overwhelming, but simple answers to your questions can make all the difference. Whether you need a quick refresher or a deep dive into T4s and tax filing, these resources will offer the help you need. 

📌 A Canadian Small Business Owner’s Guide to T4s, T4As, and RL-1s – A complete walkthrough of everything you need to know about these important year-end documents.

📌 Payroll Year-End Checklist (Canada) – A detailed checklist to make sure you’ve checked off everything for a smooth year-end, just in case! 

📌 Payroll Compliance in Canada – Stay on top of payroll rules and regulations to keep your business compliant.

Written by Kasia Wind

Kasia Wind is a Strategic Communications and Content Marketing Manager at Wagepoint. As a kid, she wanted to become a talk show host like Jenny Jones (it didn't work out). A believer that storytelling is the best way to connect, Kasia has created content for audiences including small businesses, bodybuilders and doctors. Oddly, her own stories often involve getting injured in hilarious ways.

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