The Canada Revenue Agency (CRA) has issued a Tax Tip reminding small business owners who are eligible for the Hiring Credit for Small Business (HCSB) for 2012 that they can receive that credit when they file their 2012 T4 information return later this month.
The EI hiring credit, which was introduced for the 2011 tax year and later extended to also be available for 2012, provides small business owners with a tax credit equal to any increase in EI premiums paid by the business for 2012 over those paid for 2011. The maximum credit available is $1,000 and any amount receivable is automatically credited to the employer’s payroll account with the CRA. There is no requirement for the business owner to apply for the credit, as any available credit amount will be calculated by the CRA from the T4 information filed by the business for 2011 and 2012. For purposes of the credit, a small business owner is defined as one whose total employer EI premiums for 2011 were $10,000 or less. Employers who created a new business in 2012 may also be eligible.
The CRA’s Tax Tip also notes that eligible employers who have outstanding debt with the CRA may still receive the HCSB, but that any credit earned will first be applied to reduce that outstanding debt.
The Tax Tip issued by the CRA can be found on their website. More detailed information on the 2012 credit can also be found on the Agency’s website.
