• First Reference
  • About us
  • Contact us
  • 23rd Ontario Employment Law Conference 📅
  • Blog Signup 📨

First Reference Talks

Discussions on Human Resources, Employment Law, Payroll and Internal Controls

  • Home
  • About
  • Archives
  • Conference
  • Resources
  • Buy Policies
You are here: Home / Not for Profit / Expanded Employer Health Tax exemption for charities with multiple locations

By Drache Aptowitzer LLP | 2 Minutes Read March 15, 2017

Expanded Employer Health Tax exemption for charities with multiple locations

Employer Health TaxOntario’s Employer Health Tax is a payroll tax that generally kicks in after an organization’s payroll exceeds a certain amount. In practice, this works as an exemption from the tax on the first $450,000 of the organization’s payroll.
Not every employer can benefit from this exemption, since it is intended to provide tax relief only to certain kinds of organizations. However, not only can registered charities claim the Employer Health Tax exemption,[1] they also benefit from other special Employer Health Tax rules. For example, unlike other employers, registered charities may claim the exemption even if their payroll exceeds $5 million.
As of January 1, 2017, the Employer Health Tax rules specific to charities have undergone a significant change that will benefit certain charities with multiple locations: If a registered charity has more than one “qualifying campus”, it can claim an Employer Health Tax exemption amount for each one of them separately.
Campus in this sense just means any location of the charity. A “qualifying campus” is any location that:

  • is public advertised (except for certain sensitive locations such as emergency shelters);
  • has been appropriately registered with the Ontario Ministry of Finance;
    is a permanent establishment in Ontario;
  • the charity has the exclusive right to occupy at all times; and
  • is in fact used and occupied solely by the charity at all times, for the purpose of carrying out its charitable activities.

A registered charity with more than one location that has significant payroll expenses may benefit quite a bit from the expanded exemption that comes from being able to claim each location separately. Examples might include daycares, group homes, and residential support homes.
However, any single contiguous property only counts as one “campus”. So, for example, multiple locations within one building form only a single campus, as do several buildings on a single piece of land or on a series of touching pieces of land. Additionally, certain types of internal divisions of a charity (such as various parishes that are all under the umbrella of the same registered charity) do not count as multiple campuses.
The maximum exemption amount that can be claimed for each qualifying campus is the lesser of either (A) the payroll of all the employees who report to work at that campus, or (B) the $450,000 exemption amount.
Please note that this article is merely a summary, and does not necessarily include all the relevant details needed to make a determination of eligibility.
By: Alexandra Tzannidakis


[1] In order to claim the exemption, an organization (including a charity) must be an “eligible employer” as defined in the Employer Health Tax Act of Ontario.

  • About
  • Latest Posts
Drache Aptowitzer LLP
Drache Aptowitzer LLP has extensive experience in taxation matters as well as assisting Charity and Not for Profits. Adam Aptowitzer has argued cases all the way up to the supreme court in defence of taxpayers to get a fair deal. Their dedicated team of experts can give you the guidance you need for fair results.
Latest posts by Drache Aptowitzer LLP (see all)
  • The Lord works in mysterious ways - February 12, 2020
  • It’s a whole new ball game for charities at the FCA - January 15, 2020
  • Charities in the waiting room - December 11, 2019

Article by Drache Aptowitzer LLP / Not for Profit / EHT, Employer Health Tax, Employer Health Tax rules, employment law, Payroll, Payroll tax, qualifying campus, Registered charities

Share with a friend or colleague

Get the Latest Posts in your Inbox for Free!

About Drache Aptowitzer LLP

Drache Aptowitzer LLP has extensive experience in taxation matters as well as assisting Charity and Not for Profits. Adam Aptowitzer has argued cases all the way up to the supreme court in defence of taxpayers to get a fair deal. Their dedicated team of experts can give you the guidance you need for fair results.

Footer

About us

Established in 1995, First Reference is the leading publisher of up to date, practical and authoritative HR compliance and policy databases that are essential to ensure organizations meet their due diligence and duty of care requirements.

First Reference Talks

  • Home
  • About
  • Archives
  • Conference
  • Resources
  • Buy Policies

Main Menu

  • About First Reference
  • Resources
  • Contact us
  • 1 800 750 8175

Stay Connected

  • Facebook
  • LinkedIn
  • Twitter
  • YouTube

We welcome your comments on our blog articles. However, we do not respond to specific legal questions in this space.
We do not provide any form of legal advice or legal opinion. Please consult a lawyer in your jurisdiction or try one of our products.


Copyright © 2009 - 2022 · First Reference Inc. · All Rights Reserved
Legal and Copyright Notices · Publisher's Disclaimer · Privacy Policy · Accessibility Policy