To Pay Or Not To Pay - The Rules Of Employment Insurance
The Canada Revenue Agency decides based on four circumstances, whether a person is eligible or not for employment insurance: Remuneration paid, terms and conditions of employment, duration, and nature/ importance of the work performed. If you are not sure whether a relation’s employment is insurable, call the CRA at 1.800.959.5525. If they conclude that you would have hired a non-related person under the same circumstances, then your employee/relative is insurable. If not, EI premiums should not be paid.
Managing your own payroll is a complicated task. There are a lot of rules to monitor and apply. Be sure to keep your finger on the pulse of the situation so that you’re not giving out unnecessary money, or paying penalties for disobeying rules you didn’t even know existed.