It is important for the success of the Seasonal Agricultural Workers Program, as well as for the workers, that all employers properly withhold the required amounts of income tax, CPP contributions, and EI premiums. For information regarding the Program, see Guide RC4004, Seasonal Agricultural Workers Program. For information regarding withholding and deducting these amounts, see Guide T4001, Employers’ Guide – Payroll Deductions and Remittances.
In Canada, taxation is based on residency. A worker must determine his residency status before determining how he will be taxed. Workers in the Seasonal Agricultural Workers Program are considered non-residents, deemed non-residents or deemed residents. For more information, see Guide RC4004, Seasonal Agricultural Workers Program.
The federal and provincial TD1 forms outline personal credits that employees can claim when filing their income tax return. There are different federal and provincial personal claim amounts and claim codes, and separate payroll deductions tables. Claim codes do not appear on the TD1 forms, but are included in Guide T4032, Payroll Deductions Tables.
CPP contributions must be deducted for all workers who are in pensionable employment. For more information, see Guide T4001, Employers’ Guide – Payroll Deductions and Remittances.
EI premiums must be deducted for all workers who are in insurable employment. For more information, see Guide T4001, Employers’ Guide – Payroll Deductions and Remittances.
Employers have to file T4 information return by the last day of February following the calendar year to which the information applies. Employers must deliver or mail two copies of the T4 slips to their workers on or before the last day of February following the calendar year to which the slips apply. Make sure that code 15 is entered in box 29 “Employment code” on the T4 slip for each of your foreign seasonal agricultural workers. This will identify the worker as being in the Program. For more information, see Guide RC4120, Employers’ Guide – Filing the T4 Slip and Summary.
The Canada Revenue Agency (CRA) encourages all foreign seasonal agricultural workers to file a T1 income tax return for every year that they are employed in Canada.
If you complete T1 income tax returns on behalf of your workers, make sure of the following:
On page 1 – Information about your residence, do the following:
|Country||Marital Status||TD1 Total Claim Amount
|Worker Earnings||Federal Claim Code||Withholding requirements, based on federal TD1 total claim amount of: Basic personal amount of $13,229; with spousal amount $26,458|
|All||Married||$26,458||More than $26,458||7||Begin withholding from the first day of employment|
|All||Married||$26,458||Less than $26,458||E||No tax required to be withheld immediately. If the earnings exceed $26,458, income tax must be withheld starting at that point using claim code “0”|
|Barbados||Single||$13,229||More than $10,000||I||Begin withholding from the first day of employment|
|Barbados||Single||$13,229||Less than $10,000||E/Waiver||No tax required to be withheld immediately. If the earnings exceed
$10,000, income tax must be withheld starting at that point using claim code “0”
|Mexico||Single||$13,229||More than $16,000||I||Begin withholding from the first day of employment|
|Mexico||Single||$13,229||Less than $16,000||E||No tax required to be withheld immediately. If the earnings exceed
$16,000, income tax must be withheld starting at that point using claim code “0”
|All other Countries||Single||$13,229||More than
|I||Begin withholding from the first day of employment|
|All other Countries||Single||$13,229||Less than
|E||No tax required to be withheld immediately. If the earnings exceed
$13,229, income tax must be withheld starting at that point using claim code “0”
If you did not withhold based on a total claim amount less than $26,458 for a worker who is married, you have to withhold at claim code “0” once earnings $26,458. You should contact the liaison officer or consulate in this case, as the TD1 form may need to be revised.
Use either claim code “1” or “7” depending on the total claim on the TD1 form of all the personal tax credits for each worker. See the claim codes in the tax tables to determine the correct claim code for each worker.
“Married” refers to workers who are married, have a common-law partner, or are able to claim an amount for an eligible dependant (formerly called the equivalent-to-spouse amount).
“E/waiver” means that the tax tables indicate claim code E and/or the worker has a waiver on withholding approved by the CRA. The rule applies in either case.
You can get more information from the following publications, which are available on the CRA Web site at canada.ca/cra-forms-publications or by calling CRA at 1-800-959-5525:
You can also get more information on employer issues by going to canada.ca/payroll or by calling 1-800-959-5525.
If you want information about an individual worker’s tax return, refund cheque, balance owing, statement of account, on how to file income tax returns for workers, or how the provisions of tax treaties apply to seasonal agricultural workers, call 1-800-959-8281 from anywhere in Canada and the United States or at 613-940-8495 from outside Canada or the United States.
You can also write; see the address below.
Please note: Before the CRA can give you a worker’s personal tax information, CRA must have received authorization (Form T1013, Authorizing or Cancelling a Representative or its equivalent) from the worker.
Where to mail the paper T1 return or to write your questions:
If the worker’s address is in Denmark, France, the Netherlands, the United Kingdom, or the United States, send the return to the following address:
T1 Processing Division
Winnipeg Tax Centre
PO Box 14001, Station Main
Winnipeg MB R3C 3M3
Any other country, send the return to the following address:
T1 Processing Division
Sudbury Tax Centre
1050 Notre Dame Avenue
Sudbury ON P3A 5C2