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This interpretation letter was issued based on the specific circumstances or situation of a taxpayer or vendor and the law and tax policy in effect at the time the ruling was issued. Specific facts relevant to your situation may change the application of the tax. In accordance with the Freedom of Information and Protection of Privacy Act, all confidential and identifying information has been removed from this interpretation letter. Please be aware that any statute or policy referred to in this letter may have been superseded. Where a letter contains links to a publication, the link is to our current publication on that subject, regardless of the date that the ruling was originally issued, and the current publication may not be reflective of the information originally provided. In no event shall the Government of Ontario be liable for any damages whatsoever arising out of, or in connection with, the use of the information contained herein.
Interpretation Letter 08-0108, October 2008
We refer to your letter dated XXXXXX, regarding whether Company A is required to remit Employer Health Tax (EHT) for remuneration paid to its construction project employees currently working in Alberta.
EHT is payable by all employers on remuneration paid to employees who report for work at a permanent establishment (PE) in Ontario, and to employees who do not report for work at a PE of the employer, but who are paid from or through a PE of the employer in Ontario.
An employee is considered to be reporting for work at a PE of the employer if the employee comes to the PE in person to work. If the employee does not come to the PE in person to work, the employee is considered to be reporting for work at a PE if he or she may reasonably be regarded as attached to the PE.
For EHT purposes, the definition of PE includes any fixed place of business, including the owning or leasing of land, an agency, a branch, a factory, a farm, a gas well, a mine, an office, an oil well, timberland, a warehouse and a workshop.
The information provided by you is as follows:
Based on the information provided, it is our opinion that Company A has a PE in Alberta since Company A owns the land. Company A's Alberta resident employees who are working on the Alberta plant construction project are considered to be reporting for work at that location. The employees from the Ontario warehouse who are assigned to the Alberta project are reporting for work at the Alberta PE. Therefore, for EHT purposes, Company A is not required to include any of the remuneration of the Ontario employees, who are working in Alberta, or the remuneration of the Alberta resident employees.
The construction project employees who travel back and forth between the US head office and Alberta are not relevant for EHT purposes.