GNWT Department of Finance

Payroll Tax

Payroll Tax Forms

Information for Employers

The Payroll Tax Act, 1993 came into effect July 1, 1993. Unlike other jurisdictions that impose a payroll tax on employers, the NWT Payroll Tax is levied on employees. The Payroll Tax applies to all employees who work, perform duties, or provide services in the NWT, regardless of the province or territory of residence of the employee or employer or the employee’s age.

Effective January 1, 2005 the Payroll Tax rate increased from 1 per cent to 2 per cent of gross NWT remuneration.

If an employee normally works in the NWT (ie. more than 50% of the time), payroll tax is calculated on all earnings.

Currently only Nunavut levies a payroll tax similar to that of the GNWT. The Nunavut government has a separate registration process.

Who is an employer?

An individual or corporation who has one or more employees performing work and/or providing services in the NWT.

What is remuneration?

Includes all payments, and the value of all benefits and allowances, received for work performed and/or services provided. Refer to Sections 5(1), 6 or 7 of the Income Tax Act for applicable definitions.

Examples of taxable items:

• Salaries and wages, bonuses, commissions and honoraria
• Vacation travel assistance
• Directors’ and management fees
• Employee stock options
• Contributions by employers to registered retirement savings plans (RRSP)
• Retiring allowances or severance pay

Examples of non-taxable items:

• Income from pensions or superannuation
• Reimbursement to employees of actual expenses paid on behalf of the employer
• Employer contributions to registered pension funds or plans (RPF or RPP), group sickness or accident plans, and employee benefit plans
• Value of clergy residences
• Income received by individuals who belong to a religious order, and who have taken a vow of perpetual poverty. Employers must deduct the NWT Payroll Tax, at source, and remit to the GNWT according to a schedule provided at the time of registration.

Registrations and returns

Every employer must register with the GNWT, Department of Finance within 21 days of their first payroll cycle for work or services performed in the NWT. Remittance frequency is based upon the estimated annual gross remuneration paid to employees in the NWT. Forms will be sent to registered employers approximately one month prior to the due date, or may be requested at any time from the Department of Finance.

Employers must file an Annual Return each calendar year by February 28th. Forms will be sent to registered employers approximately two months prior to the due date, or may be requested at any time from the Department of Finance.

Annual Returns must be filed even if companies did not have employees working in the NWT during the year (Nil Return).

Enforcement

Non-compliance with the NWT Payroll Tax Act, 1993 may result in penalties, interest assessment, and/or court action. Possible infractions include:

• Failure to register
• Failure to collect
• Failure to remit
• Failure to file returns

Contact Information

Postal address:
Government of the NWT
Treasury Division, Department of Finance
PO Box 1320
Yellowknife, NT X1A 2L9

Office location:
3rd Floor YK Centre
4922-48th Street
Yellowknife, NT X1A 1N2

Telephone: 867.920.3470
Toll-free: 1.800.661.0820
Fax: 867.873.0325
Email: payroll_tax@gov.nt.ca