What is a CRA remittance?
A CRA remittance is the payment a Canadian employer sends to the Canada Revenue Agency to forward the income tax, Canada Pension Plan (CPP) contributions, and Employment Insurance (EI) premiums withheld from each employee's paycheque, plus the employer's matching CPP and EI shares. In plain language: every time you run payroll, you hold money on the CRA's behalf in trust, then remit it on a strict schedule.
Get the schedule wrong by even one day and CRA penalties start at 3%. Get it badly wrong and the rate climbs to 10%, with a further 20% gross-negligence tier and daily-compounded interest at the prescribed CRA rate (currently around 8%).
What employers must remit each pay period
Three federal amounts come off employee wages on every pay run:
- Federal and provincial income tax withheld at source per the CRA's TD1 form and the BC tax tables.
- CPP contributions — both the employee deduction and a matching employer share.
- EI premiums — the employee portion plus an employer share at 1.4× the employee rate.
You send the combined total — plus the employer-side CPP and EI — to the CRA. BC employers also owe the Employer Health Tax (EHT) once payroll exceeds $1,000,000 for a calendar year, but EHT is filed separately to the BC government, not to CRA. WorkSafeBC premiums are a third, separate stream covered later in this guide.
CRA remittance voucher (PD7A) — what it is and how to read it
The CRA remittance voucher is the PD7A — Statement of Account for Current Source Deductions. It is the document that confirms what you owe, lists your remitter type, shows the due date for each period, and provides the 15-character payroll account number you need to make a payment.
You receive a PD7A in two formats:
- Paper voucher mailed to your business address — used when you remit by mail or in branch with a cheque. The voucher has a tear-off section you include with payment.
- Electronic PD7A in CRA My Business Account — same information, available under Payroll → Statement of Account. This is the version Threshold 2 employers must use.
Key fields on the PD7A:
- Payroll account number (format BN-RP-0001) — required for every payment method.
- Period-end date — tells CRA which pay period the remittance covers.
- Remitter type — Quarterly, Regular, Threshold 1, or Threshold 2. Determines your due date.
- Amount due (or amount remitted) — the figure CRA expects.
You do not need a paper PD7A to pay electronically — but you do need the account number from it. File one each year so the number is never more than a click away. If you cannot find it, log into My Business Account or call CRA Business Enquiries at 1-800-959-5525.
When are CRA remittances due in 2026?
CRA assigns every employer a remitter category based on the Average Monthly Withholding Amount (AMWA) from two calendar years prior. Your category determines the CRA remittance frequency that applies to you.
Quarterly remitter — the lightest schedule
- Trigger: AMWA under $3,000 for two consecutive years, perfect compliance history, and CRA invitation only.
- Schedule: four times a year — by the 15th of the month following each calendar quarter (15 April, 15 July, 15 October, 15 January).
- Reality check: quarterly status is a privilege, not a default. Most small employers start as Regular and only get bumped down after CRA reviews the file.
Regular remitter — the default for most small businesses
- Trigger: AMWA below $25,000.
- Schedule: monthly, due by the 15th of the following month. February's withholdings are due 15 March, March's by 15 April, and so on.
- This is where most BC corporations with 1–10 employees sit.
Threshold 1 (accelerated, twice monthly)
- Trigger: AMWA between $25,000 and $99,999.99.
- Schedule: Withholdings from the 1st–15th are due by the 25th of the same month. Withholdings from the 16th–end of month are due by the 10th of the following month.
Threshold 2 (accelerated, four times monthly)
- Trigger: AMWA of $100,000 or more.
- Schedule: within three working days after the end of each of these periods: 1st–7th, 8th–14th, 15th–21st, 22nd–end of month.
- Required: electronic remittance only. CRA dates the remittance based on when they receive the funds, not when you initiate the payment.
If you cross a threshold mid-year, CRA reassigns you the following January and confirms in the annual PD7A.
How to pay CRA remittances online
CRA payroll remittances online are the fastest, lowest-risk way to stay compliant — and the only acceptable method for Threshold 2 employers. There are five practical ways to pay.
Method 1: CRA My Business Account
Log in at canada.ca/my-business-account, select Payroll → Make a Payment, enter the period-end date and amount, then pay from a linked business bank account. The remittance is dated the same day if submitted before your bank's cut-off. This is the fastest, most-traceable method and is the one Fluent Book uses for every client.
Method 2: Pre-authorised debit (PAD)
Inside My Business Account, set up a PAD agreement so the remittance debits automatically on the due date. Useful for Regular remitters who want a hands-off schedule. PAD takes 5 business days to set up the first time — start before your first deadline, not on it.
Method 3: Online banking bill payment
Most Canadian banks let you add CRA as a payee. Use the payee labelled "Federal Payroll Deductions" (the exact label varies by bank — RBC calls it "CRA Payroll Source Deductions", BMO calls it "Federal — Payroll Deductions"). Account number = your 15-character payroll account number, format BN-RP-0001. Allow 1–2 business days for settlement.
Method 4: In-branch deposit with the PD7A voucher
Take the paper PD7A and a cheque to any Canadian bank teller. The bank stamps the voucher and forwards the payment to CRA. Slowest method — CRA dates the remittance on receipt, not on deposit. Not recommended for Threshold 1 or 2 employers.
Method 5: Cheque by mail (use only as a last resort)
Mail a cheque to the Sudbury Tax Centre with the PD7A. CRA dates the remittance when it arrives, not when you posted it. A two-day Canada Post delay can cost you a 5% penalty. Treat this as the option of last resort.
2026 CPP and EI rates with worked examples
These are the rates Fluent Book uses internally for 2026 payroll calculations. CRA publishes the official numbers each November on canada.ca; always cross-check against the current year tables before running payroll.
CPP — Canada Pension Plan (2026)
- YMPE (Year's Maximum Pensionable Earnings): $71,300
- Basic exemption: $3,500 (unchanged)
- Employee contribution rate: 5.95% on pensionable earnings between $3,500 and the YMPE
- Employer contribution rate: 5.95% (matches employee)
- Maximum employee CPP1 contribution: approximately $4,034.10
- CPP2 (second tier): 4.00% employee + 4.00% employer on earnings between the YMPE ($71,300) and the YAMPE ($81,200)
EI — Employment Insurance (2026)
- Maximum insurable earnings: $65,700
- Employee premium rate: 1.64% (outside Quebec)
- Employer premium rate: 1.4× the employee rate = 2.296%
- Maximum annual employee premium: approximately $1,077.48
- Maximum annual employer premium: approximately $1,508.47
Worked example — $50,000 BC salary, bi-weekly
Take an employee earning $50,000 a year, paid bi-weekly (26 pay periods). Per pay period gross = $1,923.08.
- CPP: ($1,923.08 − $134.62 pay-period exemption) × 5.95% = $106.41 employee withheld + $106.41 employer share
- EI: $1,923.08 × 1.64% = $31.54 employee withheld + $31.54 × 1.4 = $44.15 employer share
- Federal + BC tax (approximate): combined withholding around $260–$285 depending on TD1 claims
Total CRA remittance per pay period ≈ $580–$610. Over a year that is roughly $15,500–$16,000 going to CRA for one $50,000 BC employee.
WorkSafeBC base rates — the BC layer most guides skip
In British Columbia, on top of CRA remittances, employers register with WorkSafeBC and pay premiums based on insurable payroll and assigned classification unit. The 2026 base rates for common BC industries:
- Office and professional services (CU 765015): ~$0.13 per $100 of assessable payroll
- Restaurants and food service (CU 761039): ~$0.86 per $100
- Light residential construction (CU 721015): ~$3.84 per $100
- General trucking (CU 732030): ~$2.95 per $100
- Retail stores (CU 763019): ~$0.36 per $100
WorkSafeBC publishes the full rate schedule each December at worksafebc.com under Insurance → Rates. Confirm your CU code before relying on these rates — experience-rating adjustments can move it up or down.
WorkSafeBC premiums are filed and paid quarterly (or annually for the smallest accounts), separate from CRA. The maximum assessable earnings ceiling for 2026 is in the range of $115,000 per worker.
Step-by-step source deduction calculation
Run this for every employee, every pay period:
- Determine gross pay for the period (regular wages + overtime + commission + taxable benefits).
- Apply CPP exemption — divide the $3,500 annual basic exemption by your number of pay periods (e.g. $134.62 for bi-weekly).
- Calculate CPP — (gross − pay-period exemption) × 5.95%. Cap at the YMPE proration.
- Calculate EI — gross × 1.64%. Cap when year-to-date EI premiums hit $1,077.48.
- Calculate income tax — use the CRA Payroll Deductions Online Calculator (PDOC) or a payroll engine that honours the employee's TD1 federal and TD1 BC forms.
- Sum the employee deductions — CPP + EI + income tax = take-home reduction.
- Add employer shares — match the CPP, multiply EI by 1.4.
- Remit total — employee deductions + employer shares = the figure that lands in your CRA business account.
- Record the journal entry — debit wage expense, debit employer CPP/EI expense, credit cash for net pay, credit Payroll Liabilities — CRA for the remittance amount.
Late remittance penalty schedule
CRA penalties for late payroll remittances escalate fast.
- 1–3 days late: 3% of the amount due
- 4–5 days late: 5%
- 6–7 days late: 7%
- More than 7 days late, or never remitted: 10%
- Repeated failures (knowingly or with gross negligence): an additional 20%
Penalties compound with daily-compounded interest at the prescribed CRA rate (currently around 8% annually). Worked example: $5,000 owed on 15 March, paid 23 March (8 days late). Penalty = $500 (10%). A second slip in the same year on the next $5,000 = $1,500 penalty (10% + 20% gross-negligence). Add interest on top.
Frequently asked questions about CRA remittances
What does "remittance" mean to the CRA?
A remittance is a payment of withheld amounts (income tax, CPP, EI) plus the employer's matching CPP and EI, sent to the CRA on a strict schedule. The CRA treats withheld source deductions as held in trust — you are forwarding government money, not paying a bill of your own.
How often do I have to remit to CRA?
CRA remittance frequency depends on your remitter type: Quarterly (4×/year), Regular (monthly, by the 15th), Threshold 1 (twice/month), or Threshold 2 (four times/month). Frequency is set by CRA based on your two-year-prior Average Monthly Withholding Amount.
What is a CRA tax remittance voucher?
The CRA tax remittance voucher is the PD7A — Statement of Account for Current Source Deductions. It lists your payroll account number, period-end date, remitter category, and amount owing. Available as a paper form mailed to your business or as an electronic statement inside CRA My Business Account.
How do I pay my CRA payroll remittance online?
Three options: (1) CRA My Business Account → Payroll → Make a Payment, (2) pre-authorised debit set up inside My Business Account, or (3) online banking bill payment using your 15-character payroll account number (BN-RP-0001) as the account. All three are fast, traceable, and acceptable for any remitter type — including Threshold 2.
What happens if I deduct from an employee but never remit?
CRA treats unremitted source deductions as held in trust. The director of the corporation can be held personally liable under section 227.1 of the Income Tax Act — corporate veil does not apply.
Can I net off a CRA refund against payroll remittances?
No. Source deductions go to a separate CRA account from corporate tax. A T2 refund cannot offset payroll arrears unless you specifically request a transfer in writing.
Do I have to remit if I paid myself a dividend instead of salary?
Dividends are not subject to CPP, EI, or income tax withholding at source — they get reported on a T5 and the recipient pays personal tax at year-end. The moment you take any salary from your own corporation, you are an employee and full payroll rules apply.
What if I miss a remittance because of a banking error?
Document the error (screenshots, bank statements, error logs) and remit immediately. File a Request for Cancellation or Waiver of Penalties or Interest (form RC4288) with the proof. CRA can waive penalties for genuine third-party errors — they rarely waive interest.
How do I stop being a Threshold 2 remitter?
You cannot self-demote. CRA reviews AMWA each calendar year. If your withholdings drop, you will be reassigned the following January — until then, you remit on the accelerated schedule.
How Fluent Book handles CRA remittances
CRA remittances are one of those tasks that looks routine until the calculation is wrong, the remittance is late, or both. Fluent Book runs payroll for Canadian small businesses across BC and the rest of the country — registration, every-pay-period remittance, year-end T4 issuance, the whole stack. Honest pricing, no surprises, no judgement if your books are behind.
Book a 30-minute call at fluentbook.ca and we will scope what you need.