Interpretation

1(1)  In this regulation:

"Act" means the Income Tax Act (British Columbia);

"appropriate percentage" for a year means the lowest percentage specified in section 4.1 (1) of the Act that is applicable in determining tax payable under the Act for that year;

"base credit amount" for a particular year means the greater of

(a)the amount referred to in section 4.3 (1) (c) of the Act [basic personal credit-single status], and

(b)the sum of the amounts that the employee would be entitled to claim for that year under

(i)sections 4.3 [personal credits], 4.31 [age credit] and 4.32 [pension credit] of the Act if the description of A in those sections were read as "is equal to one",

(ii)section 4.51 of the Act [credit for mental or physical impairment] if the description of A in that section were read as "is equal to one" and as if section 118.3 (1) (c) of the federal Act were inapplicable in determining an individual's entitlement to a deduction under section 4.51 (1) of the Act,

(iii)sections 4.6 [tuition credit] and 4.61 [education tax credit] of the Act, if

(A)in applying section 118.5 (1) of the federal Act for purposes of section 4.6 of the Act, section 118.5 (1) of the federal Act were read without the expression "an amount equal to the product obtained when the appropriate percentage for the year is multiplied by",

(B)the description of A in section 4.61 of the Act were read as "is equal to one", and

(C)the amount, if any, by which the total amount of all scholarships, fellowships and bursaries that the employee claims to expect to receive in the year exceeds $3 000 were subtracted from the total of the amounts determined under sections 4.6 and 4.61 of the Act as modified by clauses A and B of this definition,

(iv)section 4.65 of the Act [transfer of unused credits to spouse or common law partner], if the formula A + B —  C were read as 

where

D is the appropriate percentage for the year, and

(v)section 4.67 of the Act [transfer of unused credits to parent or grandparent], if the formula A-B in section 4.66 of the Act were read as

where

C is the appropriate percentage for the year;

"employee" means a person receiving remuneration who reports for work at an employer's establishment in British Columbia;

"employer" , "estimated deductions", "pay period", "remuneration" and "total remuneration" each has the same meaning as in section 100 of the federal regulations;

"federal regulations" means the Income Tax Regulations under section 221 (1) of the federal Act, as amended from time to time;

"year" means a calendar year.

(2)  Amounts expressed in dollars in the Act that are relevant to the definition in this section of "base credit amount" and are subject to an annual adjustment under section 4.52 of the Act [indexing] are subject to the same annual adjustment for the purpose of that definition.

(3)  For the purposes of this regulation, section 100 (3), (3.1), (3.2) and (4) of the federal regulations applies.

(4)  A reference in this regulation to a provision of the federal regulations referred to in subsection (3) or in section 10 (1) is a reference to that provision of the federal regulations as it applies for the purposes of this regulation.

Deduction and remittance

2Every person who makes a payment described in section 153 (1) of the federal Act, as that section applies for the purposes of the Act, to an employee must deduct or withhold from that payment, and remit to the Receiver General of Canada, the amount, if any, that is determined under this regulation.

Regular remuneration

3(1)  Subject to subsection (3) and sections 4 to 8 and to section 109 of the federal regulations, the amount to be deducted or withheld under section 2 of this regulation for a pay period in which the employer makes a payment of remuneration to an employee is determined by the formula

where

A is the employee’s notional tax for the year in which the payment is made, and

B is the maximum number of such pay periods in that year.

(2)  For the purposes of this section,

(a)an employee’s notional tax for the year is the amount determined by the formula

where

C is the amount of tax that would be determined under section 4.1 (1) of the Act for the year if the employee’s notional remuneration for that year were the employee’s taxable income for the year, and

D is the total of

(i)the employee’s BC tax credit amount, and

(ii)the amount that the employee would be entitled to claim under section 4.301 of the Act for the year if the employee’s notional remuneration for that year were the employee’s income for the year,

(b)an employee’s notional remuneration for the year is the amount determined by the formula

where

E is the amount that is the mid-point of the applicable range of remuneration specified in Schedule 1 for the pay period in which the payment falls, and

F is the maximum number of such pay periods in that year, and

(c)the employee’s B.C. tax credit amount is the amount determined by the formula

where

G is the appropriate percentage for the year,

H is,

(i)if the employee is resident in Canada at the time of the payment, the amount specified in Schedule 2 as the mid-point of the range of amounts within which the employee’s base credit amount falls, and

(ii)if the employee is not resident in Canada at the time of the payment, nil.

I is the employee’s notional remuneration for the year multiplied by the employee’s premium rate for that year under the Employment Insurance Act (Canada), not exceeding the maximum amount of the premiums payable by the employee for the year under that Act, and

J is the employee’s notional remuneration for the year less the amount for that year determined under section 20 of the Canada Pension Plan multiplied by the employee’s contribution rate for the year under that Act or under a provincial plan as defined in section 3 of that Act, not exceeding the maximum amount of such contributions payable by the employee for the year under the plan.

(3)  The amount determined under subsection (1) must be rounded to the nearest multiple of 5¢, or, if that amount is equidistant from 2 such multiples, to the higher multiple.

(4)  Amounts expressed in dollars in section 4.1 (1) of the Act that are subject to an annual adjustment under section 4.52 of the Act [indexing], are subject to the same annual adjustment in determining the employee’s notional tax for the purposes of this section.

[am. B.C. Reg. 235/2005, s. 1.]

Commissions and salary or wages combined

4(1)  Subject to sections 5 to 8 of this regulation and to section 109 of the federal regulations, if an employee has made an election under section 107 (2) of the federal regulations and has not revoked that election, the amount to be deducted or withheld under section 2 of this regulation by the employer from any payment of remuneration to that employee is the amount determined by the formula

where

A is the amount of the payment, and

B is the employee's notional tax rate.

(2)  For the purposes of this section,

(a)an employee’s notional tax rate is, subject to subsection (3), the amount determined by the formula

where

C is the employee's notional tax, and

D is the employee’s total remuneration for the year,

(b)an employee’s notional tax is the amount determined by the formula

where

E is the amount of tax that would be determined under section 4.1 (1) of the Act for the year if the employee’s net notional remuneration for that year were the employee’s taxable income for the year, and

F is the total of

(i)the employee’s BC tax credit amount, and

(ii)the amount that the employee would be entitled to claim under section 4.301 of the Act for the year if the employee’s net notional remuneration for that year were the employer’s income for the year,

(c)an employee’s total remuneration for the year is the amount recorded as such by the employee on the return filed under section 107 (2) of the federal regulations,

(d)an employee’s net notional remuneration is the amount determined by the formula

where

D is the employee’s total remuneration for the year, and

H is the employee’s expenses for the year as recorded by the employee on the return filed under section 107 (2) of the federal regulations, and

(e)an employee’s B.C. tax credit amount is the amount determined by the formula

where

I is the appropriate percentage for the year,

J is

(i)if the employee is resident in Canada at the time of the payment, the employee’s base credit amount for the year as recorded by the employee on the return filed under section 9, and

(ii)if the employee is not resident in Canada at the time of the payment, nil,

K is the employee’s total remuneration for the year multiplied by the employee’s premium rate for the year under the Employment Insurance Act (Canada), not exceeding the maximum amount of the premiums payable by the employee for the year under that Act, and

L is the employee’s total remuneration for the year less the amount for the year determined under section 20 of the Canada Pension Plan multiplied by the employee’s contribution rate for the year under that Act or under a provincial plan as defined in section 3 of that Act, not exceeding the maximum amount of such contributions payable by the employee for the year under the plan.

(3)  For the purposes of this section, the amount determined under subsection (2) (a) is to be rounded to 2 places after the decimal by

(a)adding .005 to the first 3 digits after the decimal, and

(b)dropping the third digit from the total obtained under paragraph (a).

(4)  Amounts expressed in dollars in section 4.1 (1) of the Act that are subject to an annual adjustment under section 4.52 of the Act [indexing], are subject to the same annual adjustment in determining the employee’s notional tax for the purposes of this section.

[am. B.C. Reg. 235/2005, s. 2.]

EVCC shares

5(1)  If in a year an employer deducts from a payment of remuneration to an employee an amount in respect of the acquisition by the employee of an EVCC share, there must be deducted from the amount determined under section 3 (1) or 4 (1), as the case may be, in respect of that payment the smaller of

(a)15% of the amount deducted or withheld in respect of the acquisition of the share, and

(b)the amount determined by the formula

where

A is $2 000, and

B is the total of all deductions made under this subsection in respect of prior pay periods in that year.

(2)  In this section, "EVCC share" means a share of a corporation registered under Part 2 of the Employee Investment Act as an employee venture capital corporation.

Bonuses, retroactive increases and lump sum payments

6(1)  If in any year a payment for a bonus or retroactive increase in remuneration is made by an employer to an employee whose total remuneration from the employer, including the bonus or retroactive increase, may reasonably be expected not to exceed $5 000 in that year, the amount to be deducted or withheld under section 2 by the employer from the payment is 5% of the payment.

(2)  If, in any pay period in a year, a payment for a bonus is made by an employer to an employee whose total remuneration from the employer, including the bonus, may reasonably be expected to exceed $5 000 in that year, the amount to be deducted or withheld under section 2 by the employer from the payment is the amount determined by the formula

where

A is the maximum number of such pay periods in that year,

B is the amount determined under section 3 for an assumed remuneration equal to the sum of

(a)the amount of regular remuneration paid by the employer to the employee in the pay period in which the bonus payment is made, and

(b)an amount equal to the bonus payment divided by the number of pay periods in that year, and

C is the amount determined under section 3 in respect of the amount of regular remuneration paid by the employer to the employee in the pay period in which the payment is made.

(3)  If in any year a payment for a retroactive increase in remuneration is made by an employer to an employee whose total remuneration from the employer, including the retroactive increase, may reasonably be expected to exceed $5 000 in that year, the amount to be deducted or withheld under section 2 by the employer from the payment is the amount determined by the formula

where

D is the number of pay periods for which the increase in remuneration is retroactive,

E is the amount determined under section 3 for the new rate of remuneration, and

F is the amount determined under section 3 for the previous rate of remuneration.

(4)  Subject to subsection (5), if a lump sum payment as defined in section 103 (6) of the federal regulations is made by an employer to an employee who is a resident of Canada, the amount to be deducted or withheld under section 2 of this regulation by the employer from the payment is as follows:

(a)3% of the payment, if the payment does not exceed $5 000;

(b)7% of the payment, if the payment exceeds $5 000 but does not exceed $15 000;

(c)10% of the payment, if the payment exceeds $15 000.

(5)  If the lump sum payment referred to in subsection (4) is pension income or qualified pension income of the employee to which section 4.32 of the Act would apply if the definition "pension income" in subsection 118 (7) of the federal Act were read without reference to paragraph (a) (ii) and (iii) of that definition, the payment is deemed to be the amount of the payment minus,

(a)if the payment does not exceed $30 004, the smaller of $1 000 and the amount of the payment,

(b)if the payment exceeds $30 004 and does not exceed $60 009, the amount determined by the formula

where

A is the appropriate percentage, and

B is the percentage in section 4.1 (1) (b) (ii) of the Act that is applicable in determining tax payable under the Act for the year in which the payment is made,

(c)if the payment exceeds $60 009 and does not exceed $70 000, the amount determined by the formula

where

A is the appropriate percentage, and

B is the percentage in section 4.1 (1) (c) (ii) of the Act that is applicable in determining tax payable under the Act for the year in which the payment is made,

(d)if the payment exceeds $70 000 and does not exceed $85 000, the amount determined by the formula

where

A is the appropriate percentage, and

B is the percentage in section 4.1 (1) (d) (ii) of the Act that is applicable in determining tax payable under the Act for the year in which the payment is made, or

(e)if the payment exceeds $85 000, the amount determined by the formula

where

A is the appropriate percentage, and

B is the percentage in section 4.1 (1) (e) (ii) of the Act that is applicable in determining tax payable under the Act for the year in which the payment is made.

(6)  An amount that

(a)is expressed in dollars in subsection (5), and

(b)is the same as an amount in section 4.1 of the Act that is subject to adjustment under section 4.52 of the Act [indexing],

is subject to the same annual adjustment for the purposes of subsection (5) of this section.

(7)  For the purposes of subsection (5) (b) to (e), the amount determined by the formula must be rounded to the nearest multiple of one dollar, or, if that amount is equidistant from 2 such multiples, to the higher multiple.

When deductions are not required

7No amount is required to be deducted or withheld under this regulation from a payment in respect of an employee who was neither employed nor resident in Canada at the time of the payment, except in respect of

(a)remuneration described in section 115 (2) (e) (i) of the federal Act that is paid to a non-resident person who has in the year in which the payment is made, or who had in any previous year, ceased to be a resident of Canada, or

(b)remuneration reasonably attributable to the duties of any office or employment performed or to be performed in Canada by the non-resident person.

Variations in deductions

8(1)  This section applies to a payment of remuneration by an employer to an employee if

(a)the payment is made in respect of a period for which no provision is made in Schedule 1, or

(b)the payment is made for a pay period referred to in Schedule 1, and the amount of the payment is greater than any amount provided for in that schedule for that pay period.

(2)  In the circumstances described in subsection (1), the amount to be deducted or withheld under section 2 from the payment of remuneration is the amount determined by the formula

where

A is the amount of the payment,

B is the tax reasonably expected to be payable under the Act by the employee on the total remuneration reasonably expected to be paid by the employer to the employee for the year in which the payment is made, and

C is the total remuneration referred to in the description of B.

Employees' returns

9If an employee is required under section 227 (2) of the federal Act as it applies for the purposes of this regulation to file a return with the employer,

(a)the return must be in the form authorized by the Minister of Finance and Corporate Relations,

(b)the return must be filed with the employer when the employee commences employment with that employer, and

(c)a new return in the same form must be filed within 7 days after the date of any event that may reasonably be expected to change the employee's base credit amount for the year.

Application of other provisions of federal regulations

10(1)  The following provisions of the federal regulations apply for the purposes of this regulation:

(a)section 102 (5) [previously reported commissions];

(b)section 104 (3), (3.01), (3.1) and (4) [payments out of or under an RRSP during lifetime of annuitant];

(c)section 104.1 [lifelong learning plan];

(d)section 107 (2) and (3) [election to file form relating to commissions and revocation of election];

(e)section 108 [remittances to Receiver General];

(f)section 109 [election to increase deductions], except that, in addition to any other necessary modifications, a reference in that section to "the form prescribed by the Minister" is to be read as a reference to "the form authorized by the Minister of Finance and Corporate Relations";

(g)section 110 (1) [prescribed persons for purposes of remittances].

(2)  Section 100 (2) and (5) of the federal regulations does not apply for the purposes of this regulation.

1For the purposes of the description of E in section 3 (2) (b), the ranges of remuneration for each pay period in a taxation year must be determined as follows:

(a)in respect of a daily pay period, the ranges of remuneration commence at $35 and increase in increments of $1 for each range up to and including $88.99;

(b)in respect of a weekly pay period, the ranges of remuneration commence at $161 and increase in increments of

(i)$2 for each range up to and including $268.99,

(ii)$4 for each range from $269 to $488.99,

(iii)$8 for each range from $489 to $928.99,

(iv)$12 for each range from $929 to $1 588.99,

(v)$16 for each range from $1 589 to $2 468.99, and

(vi)$20 for each range from $2 469 to $3 568.99;

(c)in respect of a bi-weekly pay period, the ranges of remuneration commence at $322 and increase in increments of

(i)$4 for each range up to and including $537.99,

(ii)$8 for each range from $538 to $977.99,

(iii)$16 for each range from $978 to $1 857.99,

(iv)$24 for each range from $1 858 to $3 177.99,

(v)$32 for each range from $3 178 to $4 937.99, and

(vi)$40 for each range from $4 938 to $7 137.99;

(d)in respect of a semi-monthly pay period, the ranges of remuneration commence at $349 and increase in increments of

(i)$4 for each range up to and including $564.99,

(ii)$8 for each range from $565 to $1 004.99,

(iii)$18 for each range from $1 005 to $1 994.99,

(iv)$26 for each range from $1 995 to $3 424.99,

(v)$34 for each range from $3 425 to $5 294.99, and

(vi)$44 for each range from $5 295 to $7 714.99;

(e)in respect of 12 monthly pay periods, the ranges of remuneration commence at $697 and increase in increments of

(i)$8 for each range up to and including $1 128.99,

(ii)$18 for each range from $1 129 to $2 118.99,

(iii)$34 for each range from $2 119 to $3 988.99,

(iv)$52 for each range from $3 989 to $6 848.99,

(v)$70 for each range from $6 849 to $10 698.99, and

(vi)$86 for each range from $10 699 to $15 428.99;

(f)in respect of 10 monthly pay periods, the ranges of remuneration commence at $836 and increase in increments of

(i)$10 for each range up to and including $1 375.99,

(ii)$20 for each range from $1 376 to $2 475.99,

(iii)$42 for each range from $2 476 to $4 785.99,

(iv)$62 for each range from $4 786 to $8 195.99,

(v)$84 for each range from $8 196 to $12 815.99, and

(vi)$104 for each range from $12 816 to $18 535.99;

(g)in respect of 4-week pay periods, the ranges of remuneration commence at $643 and increase in increments of

(i)$8 for each range up to and including $1 074.99,

(ii)$16 for each range from $1 075 to $1 954.99,

(iii)$32 for each range from $1 955 to $3 714.99,

(iv)$48 for each range from $3 715 to $6 354.99,

(v)$64 for each range from $6 355 to $9 874.99, and

(vi)$80 for each range from $9 875 to $14 274.99;

(h)in respect of 22 pay periods per year, the ranges of remuneration commence at $380 and increase in increments of

(i)$5 for each range up to and including $649.99,

(ii)$10 for each range from $650 to $1 199.99,

(iii)$18 for each range from $1 200 to $2 189.99,

(iv)$28 for each range from $2 190 to $3 729.99,

(v)$38 for each range from $3 730 to $5 819.99, and

(vi)$48 for each range from $5 820 to $8 459.99.

1For the purposes of section 3 (2) (c), the mid-point of each range of base credit amounts listed in the first column of the following table is the amount specified opposite in the second column of the table.