Entrepreneurship & Small Business

Independent contractor with one company remitting EI

  • Last Updated:
  • May 28th, 2018 10:35 am
Nov 25, 2009
322 posts

Independent contractor with one company remitting EI

Hello, I'm an independent contractor with one client, payrolling myself out. I've been reading this: https://www.bdo.ca/en-ca/insights/tax/t ... ase-study/

I realized I've been remitting EI when I didn't need to. How do I get my money back? :(
2 replies
Jr. Member
Jan 18, 2017
101 posts
Assuming you're operating as a corporation, and that you are T4'ing out a salary to you, and that this applies to the 2018 calendar year period:

- When you complete your T4 filing for the year, treat the EI as extra tax instalments. For example, imagine that you've remitted $100 for tax, $50 for CPP, and $50 for EI ($200 total remitted), and then you realize oops, shouldn't have done that $50 for EI. To fix it, when February/19 rolls around, file the T4 figures as $150 for tax, $50 for CPP, and $0 for EI (Note that the remittances still add up to $200). (Also remember to check the box for "EI exempt" while you're at it.)

This works because all CRA sees on their end is the $200 figure - not the breakdown for the individual tax/CPP/EI. You could always try and call and explain what happened, but in a best case scenario that can take 5 months to sort out, if not longer. We've found that instead of trying to get the money back, it's easier to just adjust the T4 filing, with the end effect of the client getting back a bigger refund.
Canadian & US tax guy