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How do I enter the Small Business Job Credit refund into QuickBooks or QBO?

This week, I’ve been noticing that the Job Credits for Small Business have been appearing in many of my customers’ CRA online accounts. I haven’t seen any refund cheques or deposits yet, but those should be starting to roll in soon.

You might remember the Hiring Credit for Small Business (HCSB) that was around for several years and ended in 2013. This is similar. One notable different is that the CRA will be sending out the refunds rather than having small businesses apply the credits to an upcoming payment.

What’s the Small Business Job Credit?

The Small Business Job Credit will effectively lower small businesses’ Employment Insurance (EI) premiums from the current legislated rate of $1.88 to $1.60 per $100 of insurable earnings in 2015 and 2016. Any firm that pays employer EI premiums equal to or less than $15,000 in those years will be eligible for the credit. Almost 90% of all EI premium-paying businesses in Canada will receive the credit, reducing their EI payroll taxes by nearly 15%.

Source: http://www.fin.gc.ca/n14/14-120-eng.asp

How will I get the credit?

No action necessary. The Canada Revenue Agency will automatically calculate the credit, meaning no paperwork for you.

The credit will not be carried forward. You will receive a refund by direct deposit (if you’ve signed up for it) or mailed cheque less any outstanding amounts on your account.

This credit can be entered as income or as a reduction in your EI expense.

How do I enter this into QuickBooks?

Banking > Make Deposits

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How do I enter this into QBO?

Plus Sign > Bank Deposit

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For more information about the Small Business Job Credit, check out http://www.cra-arc.gc.ca/whtsnw/tms/sbjc-eng.html

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4 thoughts on “How do I enter the Small Business Job Credit refund into QuickBooks or QBO?

  1. This is a helpful post, thanks. I just registered for a HST account. Can you point me to where I can read up things that I can expense under my sole proprietor business? I want to find answers to questions such as if I buy a book that helps in my business, can I expense it, etc. Thank you!

  2. You’re welcome! The CRA has everything you could possibly want to know (and more!) on their website. Here’s a link to your specific question: http://www.cra-arc.gc.ca/tx/bsnss/tpcs/slprtnr/bsnssxpnss/menu-eng.html If that book helps you to earn income, then yes, it would likely qualify as a business expense. I would also encourage you to check out my friend Lake’s website. She has a ton of great information about doing business in Canada and a variety of sales tax topics. Here’s a link to her website http://www.bookkeeping-essentials.com/

  3. Charlene Haste on said:

    Hello,

    Could I not just enter this as a journal entry?
    Debit my checking account
    Credit my Payroll tax account and enter Receiver General in the name field.

    Thanks,
    Charlene

  4. Most ProAdvisors will tell you to avoid JEs except where absolutely necessary. This is one place where a JE is definitely not necessary, as you have the deposit screen available for the entry.

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