New BC Employer Tax Credit Coming in March 2021
On September 17, 2020, the BC Government announced the BC Increased Employment Incentive, a refundable tax credit for eligible employers who increase their payroll for eligible employees between Q3 and Q4, 2020, by either creating new jobs or increasing existing employees’ pay. Online applications will open in March, 2021, through the eTaxBC system.
Eligible employers are all employers in BC other than public institutions.
The tax credit will be calculated as 15% of the amount that the employer’s qualifying BC remuneration paid to eligible employees from Q4, 2020, exceeds the employer’s base BC remuneration paid to eligible employees from Q3, 2020. Both the qualifying and base BC remuneration calculation will be capped at a maximum of $1,129.33 per employee per week. Partial weeks will be prorated.
Eligible employees must report for work at a permanent establishment of the employer in BC or be paid from a permanent establishment in BC and principally perform their duties in BC. An employee is considered to have reported for work at a permanent establishment of a BC employer if the employee is sufficiently attached to the permanent establishment, either by working at the establishment in person, or temporarily working from home due to COVID-19. Generally, an employer will have a permanent establishment in BC if the employer has a fixed place of business in BC.
If employers qualify for the Canada Emergency Wage Subsidy as well as the new BC Increased Employment Incentive, they may receive assistance from both programs.
This update is part of our continuing efforts to keep you informed about COVID-19. Check our COVID-19 hub and our McCarthy Tétrault Employer Advisor blog for further updates. If you need assistance, please reach out to any member of our National Labour & Employment Team.