Published: March 2011
Content last reviewed: August 2013
ISBN: 978-1-4435-5036-9 (Print), 978-1-4435-5038-3 (PDF), 978-1-4435-5037-6 (HTML)
As announced in the 2013 Ontario Budget, to provide greater Employer Health Tax (EHT) relief to small businesses, the government has increased the amount of annual payroll that is exempt from the tax from $400,000 to $450,000 and indexed this amount for inflation. To better target EHT relief, the exemption is eliminated for private-sector employers (including groups of associated employers) with annual Ontario payrolls over $5 million. Registered charities can continue to claim the exemption at all payroll sizes.
The government has passed legislation to implement these changes effective January 1, 2014. Find out more
This and related EHT publications will be updated shortly.
Enter the Total Ontario Remuneration paid to all employees and former employees during the period January 1 to December 31. Include amounts paid to employees who reported for work at a location in Ontario, and amounts paid to employees who did not report for work at any of your locations, but were paid from a location in Ontario.
Enter $400,000 if you were an eligible single account employer for the full calendar year. A part-year employer must prorate the exemption by the number of days in the year that the employer was eligible and had a location in Ontario with payroll.
In general, private sector employers are eligible employers. Public sector employers cannot claim this exemption.
Eligible employers who are associated are required to enter into an agreement to allocate the exemption to one or more members of the group. Beginning with the 2010 return, only one member is required to complete the Associated Employers Exemption Allocation form and submit it to the ministry by the return due date. The exemption for all members of the group may be denied if a completed form is not received.
An eligible employer with multiple accounts may allocate the exemption to its accounts to the extent that the employer does not exceed its allowable exemption amount for the year. A Multiple Accounts Schedule is no longer required.
Subtract line 2 from line 1 to determine your Taxable Ontario Remuneration. If the result is negative, enter 0 on this line as you do not owe any EHT for this year. If you do not owe any EHT, you are still expected to certify and file a nil return.
Use the following table to determine the applicable tax rate.
|Total Ontario Remuneration (from line 1)||Tax Rate|
|Up to $200,000||0.980%|
|$200,001 to $230,000||1.101%|
|$230,001 to $260,000||1.223%|
|$260,001 to $290,000||1.344%|
|$290,001 to $320,000||1.465%|
|$320,001 to $350,000||1.586%|
|$350,001 to $380,000||1.708%|
|$380,001 to $400,000||1.829%|
If you are an associated employer or a single account employer, the tax rate is based on Line 1 of each return. If you are a multiple accounts employer, use the tax rate applicable to the sum of the Total Ontario Remuneration for all of your EHT accounts.
Multiply line 3 by line 4 and enter the result on line 5.
Enter the total of all payments made for the year (excluding any interest or penalty payments). Include any credit amount that has been used to reduce a payment during the year. Monthly instalments are required if the Total Ontario Remuneration exceeds $600,000 in a calendar year.
Subtract line 6 from line 5 and enter the result on line 7. A positive amount indicates a balance owing; a negative amount indicates an overpayment.
Enter the amount of your payment and enclose a cheque or money order in Canadian funds, payable to the Minister of Finance, or pay online using ONT-TAXS. Do not send cash.
Please check "yes" or "no" to indicate whether you are associated with one or more other employer(s).
Please check "yes" if you would like your overpayment credited to the following year's liability.
Certify your EHT Annual Return – Voucher 1 and file it with the Ministry of Finance on or before the due date: using ONT-TAXS online; by mail; or in person at certain ServiceOntario locations. To avoid penalties and interest, you must file your return by March 15th.
Employers who pay all remuneration in one month of a calendar year are required to file a Special Return within 15 days following the month in which the remuneration was paid. An employer who ceases to have employees or a permanent establishment in Ontario, or who has amalgamated, must advise the Ministry of Finance and file a Final Return, within 40 days of the business closure date.
Use the EHT Payment Only-Voucher 2 only if your return is filed by a third party, or if you file your return online and you elect not to pay online.
If your return is filed by a third party, it is your responsibility to ensure that the information in the return is, to the best of your knowledge, true, correct and complete.
For more information or to make changes to your account, visit the ministry's website at ontario.ca/finance or contact the Ministry of Finance at: 1 866 ONT-TAXS (1 866 668-8297) or 1 800 263-7776 teletypewriter (TTY).