Employer Health Tax relief (EHT)
Last Update: May 30, 2025
ON, Canada
Ontario payroll tax relief for eligible employers and charities
Employer Health Tax relief (EHT) at a glance
Eligible Funding
- No Condition
Timeline
- Open Date : May 12, 2020
Financing Type
Tax Credits
Eligible Industries
- All industries
Grant Providers
- Ontario Ministry of Finance
- Government of Ontario
Status
Open
Overview of the Employer Health Tax relief (EHT) program
The Employer Health Tax (EHT) relief provides an exemption of up to $1 million on Ontario payroll to eligible employers, helping reduce payroll tax liability. The program supports organizations by offsetting tax costs on salaries, wages, and other employee remuneration, thereby encouraging job retention and operational sustainability.
Financing terms and conditions
The Employer Health Tax relief does not specify distinct financing modalities within the provided information. Instead, it focuses on tax exemption and obligations for employers regarding their payrolls.
Eligible projects & activities
Examples of admissible projects:
$ 500,000
Developing an advanced fintech solution to streamline loan processing for credit unions
$ 200,000
Setting up a community recycling program for a local non-profit organization
$ 250,000
Expanding a farm-to-table delivery service to support local agriculture
$ 160,000
Creating an environmental conservation education program
$ 150,000
Improving accessibility at a community theatre
$ 120,000
Launching a digital literacy campaign to help senior citizens
Eligibility criteria of the Employer Health Tax relief (EHT) program
Eligibility for the Employer Health Tax (EHT) exemption is determined by specific requirements related to the employer's status and payroll levels.
- The employer must be an eligible employer as defined under the EHT Act.
- The employer must pay income taxes.
- The Ontario payroll for the year, including that of any associated employers, must be less than $5 million, or the employer must be a registered charity.
- The employer must not be under the control of any level of government, such as having municipal representatives on their board.
Who is eligible?
Eligible employers, as defined under the EHT Act, can apply for the Employer Health Tax (EHT) exemption if they meet the following conditions: they pay income taxes, their Ontario payroll is less than $5 million, or they are a registered charity, and they are not controlled by any level of government.
Eligible expenses
Eligible expenses for this grant include:
- Remuneration paid to employees
- Salaries, wages, bonuses, taxable benefits, stock options, etc.
Eligible geographic areas
This grant is explicitly applicable to employers operating in Ontario. The scope restricts eligibility based on the employer's establishment location within Ontario.
- Employers with a permanent establishment in Ontario.
- Companies paying employees from an Ontario-based establishment.
- Registered charities operating in Ontario.
Eligibility criteria of the Employer Health Tax relief (EHT) program
There are evaluation and selection criteria for this grant. The criteria include:
- Employers are required to pay EHT on remuneration paid to employees who meet certain conditions
- Eligible employers must register for an EHT account with the Ontario Ministry of Finance
- An exemption amount is available for eligible employers based on their Ontario payroll
- Associated employers must share the tax exemption for the year and meet specific requirements
- Specific tax rates apply based on the level of Ontario payroll
How to apply to the Employer Health Tax relief (EHT) program
1
Register for EHT Account
- Gather necessary information such as legal name, trade name, business address, and federal business number (BN).
- Decide on the registration method: online, phone, or at a ServiceOntario centre.
- If you are not eligible for the exemption or your payroll exceeds the allowable exemption, complete the registration.
2
Calculate EHT Liability
- Determine the total Ontario remuneration before any exemptions.
- Identify the applicable tax rate based on your payroll bracket.
- Calculate the EHT owed by applying the tax rate to remuneration after deduction of any exemptions.
3
Submit Annual Return
- Receive a personalized annual return and addressed return envelope from the Ministry of Finance.
- File the return through ONT-TAXS online, in-person at a ServiceOntario centre, or by mail.
- Ensure the return is filed on or before March 15th.
4
Pay EHT
- Determine if you need to make monthly instalments based on your payroll size.
- Complete payment through ONT-TAXS online, in person at a bank, or by mail.
5
Record Keeping
Maintain detailed records and books of account as required under the EHT Act and Regulations.
Additional information
In addition to the eligibility criteria and processes, here are some further details on managing Employer Health Tax (EHT) duties in Ontario:
- Employers are expected to maintain an accurate record and keep books in line with the EHT Act and Regulations.
- The interest rates on any outstanding balance for EHT obligations may change quarterly, which employers must stay updated on.
- Employers needing assistance with specific scenarios can request written interpretations from the Ministry.
- The Ministry of Finance offers interest and penalty relief during specified periods, such as the COVID-19 relief window.
- It is essential for employers to accurately complete all information required on EHT-related forms to avoid penalties.
- Employers who disagree with EHT assessments can file a Notice of Objection or Appeal within designated timeframes.
- Out-of-province employers establishing themselves in Ontario for less than 24 months should contact the Ministry to understand their obligations.
- Benefits of compliance include avoiding fines, penalties, and potentially harsh legal repercussions for incorrect filings or misstatements.
Apply to this program
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