Increased Employment Incentive (IEI) – Refundable Tax Credit for Hiring – Applications Now Open
The Increased Employment Incentive is a refundable tax credit available to almost all employers that can be as much as 15% of the increase in their payroll in the final quarter of 2020 compared to earlier in 2020. If you rehired employees, hired new employees, or provided wage increases in the final quarter of 2020 this tax credit could provide support to you.
For full details, visit the Government of BC page here, or read below for highlights on how this new incentive works.
Applications are open from March 30, 2021 until December 31, 2021
How It Works
- This is a one-time refundable tax credit
- The amount you can get is 15% of the amount your payroll increased in Q4 2020 compared to Q3 2020
- Credit $ = (Total eligible payroll for all employees in Q4 2020 – Total eligible payroll for all employees in the Q3 2020) x 15%
- Eligible payroll per employee is capped at a maximum amount of $1,129.33 per Sunday to Saturday week
- Non-Arms Length employees are only eligible if on payroll prior to July 1, 2020.
- A business had two employees earning $1000 per week for all of 2020. Therefore the payroll for the company in Q3 2020 was $26,400
- The business then hires a third employee at $1000 per week and they start work on October 1, 2020. This additional payroll is $13,200, so the payroll for the company in Q4 2020 is $39,600.
- Because this business’ payroll increased in Q4 by $13,200, they could claim a credit of $1980 (or 15% of the increase)
- There is no maximum to the credit, but any credit will be applied to outstanding PST remittances or Employer Health Tax payments owed
- All employers except for public institutions and political parties can be eligible
- Must have increased your payroll in Q4 2020 compared to Q3 2020
- Must have a permanent establishment in BC in Q4 2020
How To Apply
- If you have an eTaxBC logon for employer health tax (EHT) or provincial sales tax (PST), log on to access the B.C. increased employment incentive application.
- If you don’t have an eTaxBC logon for the employer health tax (EHT) or provincial sales tax (PST), you can apply for the credit online using eTaxBC without creating an account.
- You will require documentation to apply, including your business number, the names and SINs of your employees and more. Click here for the required documentation.
Questions or feedback on this or any COVID-19 support program or regulation? Burnaby Board of Trade members can contact our Director of Policy at email@example.com
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