New T4 Reporting Requirements in 2020

There are new reporting requirements applicable to the completion of the 2020 T4 slips and summaries.

Additional T4 reporting requirements will apply to all employers, and will help the Canada Revenue Agency (CRA) validate payments under the Canada Emergency Wage Subsidy (CEWS), the Canada Emergency

Response Benefit (CERB), and the Canada Emergency Student Benefit (CESB).

New T4 Information Codes

In addition to reporting employment income in Box 14 or Code 71, use new other information codes when reporting employment income and retroactive payments in the following periods:

• Code 57: Employment income – March 15 to May 9
• Code 58: Employment income – May 10 to July 4
• Code 59: Employment income – July 5 to August 29
• Code 60: Employment income – August 30 to September 26

Each period above relates to the day the employee was paid.

Eligibility criteria for the CERB, CEWS, and CESB is based on employment income for a defined period. The T4 new requirement means employers should report income and any retroactive payments made during these periods.

Temporary Wage Subsidy (TWS) and T4 Summaries

All employers that claimed the TWS are required to complete Form PD27, 10% Temporary Wage Subsidy Self-identification Form for Employers.

CRA will use Form PD27 to reconcile the amount of payroll remittances during the relevant pay periods to the amounts reported on the 2020 T4 summary reconciliation. Employers must obtain the exact TWS amounts claimed for each payment date to ensure that the T4 summary totals agree with the actual remittances to the CRA.

The PD27 requires employers to report amounts based on pay periods whereas the TWS was based on payment dates.

Currently, there is no due date for the PD27 although employers are encouraged to file as soon as possible to avoid receiving a discrepancy notice from the CRA.

For more information on business tax accounting and the new T4 reporting requirements please contact us.