The BC increased employment incentive is a one-time refundable tax credit for employers. The deadline to apply is December 31, 2021.
How the Incentive Works
The increased employment incentive allows employers to apply for a one-time tax credit. The credit is 15 per cent of the amount that the employer’s total eligible remuneration for all eligible employees in the qualifying period exceeds the employer’s total eligible remuneration for all eligible employees in the base period.
The base period is from July 1 to September 30, 2020.
The qualifying period is from October 1 to December 31, 2020.
The credit:
- Does not have a maximum amount but a credit amount less than $10 will not be paid
- Is not reduced by any provincial or federal support you may receive, such as the BC training tax credits or the federal Canada Emergency Wage Subsidy (CEWS)
- Will offset any provincial tax debts an employer has outstanding at the time the credit is payable, such as the employer health tax or the provincial sales tax
Eligibility
All employers, including employers who did not have to pay the employer health tax, are eligible for the credit if they:
- Increased their eligible remuneration for the qualifying period compared to the base period
- Had a permanent establishment in BC for the qualifying period, even if they didn’t begin to have a permanent establishment in BC until after September 30, 2020
- Are one of the following:
- Not a public institution or registered political party
- An Indigenous business as described for the Canada emergency wage subsidy (CEWS)
- An employer or partnership who operates a private school or private college
- A partnership, unless:
- One or more members of the partnership is a public institution (except an aboriginal government or Indigenous governing body) or registered political party; and
- 50 per cent or more of the fair market value of all interests in the partnership is held, between July 1, 2020 and December 31, 2020, directly or indirectly, by one or more entities that is a public institution (except an aboriginal government or Indigenous governing body) or registered political party
Associated employers
If you’re associated with one or more employers on December 31, 2020, you’re an associated employer for the purpose of calculating the credit amount.
For the purposes of the increased employment incentive, charitable or non-profit employers are subject to the association rules.
Only one employer within an associated group of employers can claim the eligible remuneration for any employee if that employee is employed by more than one of the associated employers during either the base period or the qualifying period.
Calculate your credit
The credit is calculated at 15 per cent of the amount that the employer’s total eligible remuneration for all eligible employees in the qualifying period exceeds their total eligible remuneration for all eligible employees in the base period.
(Total eligible remuneration for all eligible employees in the qualifying period – total eligible remuneration for all eligible employees in the base period) x 15 per cent
Eligible remuneration
Eligible remuneration is the remuneration paid by an employer to or on behalf of an eligible employee for the base period or the qualifying period. For each eligible employee, eligible remuneration must not exceed the maximum amount of $1,129.33 per week.
If the eligible employee did not report to work in BC at any time during the base period or the qualifying period, do not include any amount of remuneration that was paid to that employee in respect of the time that the employee did not report to work in BC
The maximum amount is prorated for partial weeks at the beginning or end of the base period or qualifying period.
To calculate the total eligible remuneration for each period, add the eligible remuneration of each eligible employee for each period.
For remuneration to be included in the calculation, it must be paid to or on behalf of an eligible employee on or before June 30, 2021 or before the employer applies for this credit, whichever is earlier.
