Pension plan - 5.45% - 5.9% depending on the province
Employment insurance - 1.6% - 2.2% dependent on territory
Employer Health tax - 0.98% - 4.3% dependent on territory
Canada pension plan: 5.45% - 5.9%, dependent on territory
Employment insurance - 1.18% - 1.58% dependent on territory
Income tax: Income taxes in Canada are levied on both federal and provincial/territorial levels, see details here.
| GROSS INCOME | PROGRESSIVE TAX RATE |
|---|---|
| Up to $49,020 | 15% |
| €49,020 - $98,040 | 20.5% |
| €98,040 - $151,978 | 26% |
| €151,978 - 216,511 | 29% |
| More than $216,511 | 33% |
Paid time off: two weeks on average + public holidays
Paternity leave: no statutory leave
Sick leave: no paid leave, number of unpaid days varies by province/territory
Parents and parental leave: 37-71 weeks depending on province/territory
Maternity leave: 16-19 weeks
Independent contractor agreements
Direct local employer setup
Partnering with an Employer of Record Canada /full-service Professional Employer Organisation
Setting up a local company in Canada is relatively straightforward. However, the difficult part comes after the initial setup when the employer needs to run payroll for their Canadian employees every month, file taxes, extend and manage employee benefits, follow changes rules and regulations. Here is an overview of everything an employer in Canada will find themselves needing to do for their Canadian employees.
When you hire employees in Canada, you have certain obligations as an employer. HR compliance is about ensuring your policies and procedures respect all applicable laws and regulations regarding employment and work practices. Complying with local employment law in Canada is fundamental for the correct running of your business - not only because these laws are in place to protect employees and guarantee their rights are safeguarded, but to minimise your risk of liabilities as an employer. Being compliant means respecting and following all local labour laws, sick leave and illness benefits, annual leave, minimum wage, tax credits, working hours regulations, employment contracts, etc.
As with every other country, there are certain costs associated with employing a worker in Canada that come on top of the gross salary you are offering. In Canada those are pension plans contribution, employment insurance, and employer health tax. To view the exact percentages and amounts given the salary you are planning to offer, you can use our handy calculator tool.
Boundless as the Employer of Record Canada files all pertinent taxes, Canada pension plan contributions and other contributions to the social system in order for the Canada employee to be compliant.
In Canada, both employers and employees have to pay taxes. For employers, these include pension plans contribution, employment insurance, and employer health tax and for employees, they include Canada pension plan contribution, employment insurance, and income tax. To get a clear overview with both employee and employer taxes, use our salary breakdown calculator, submitting any additional data needed and get a downloadable pdf like this one.
