Dental payroll for practices
A practice payroll mixes salaried admin, part-time hygienists, and associates who may or may not be employees. Each is treated differently, and only one of those mistakes is expensive.
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Three kinds of people on one payroll
A typical practice pays salaried administrative staff, hourly or part-time hygienists who may also work at other offices, and associates under an arrangement that might be employment or might be a contract for services. The first two are straightforward. The third decides whether your payroll is compliant.
The associate question, and why it lands on you
If an associate is genuinely independent, they invoice the practice and handle their own remittances, and you report the payments on a T4A. If the relationship is really employment, you should have been withholding income tax, CPP, and EI, and reporting on a T4.
CRA decides that on substance: who controls how the work is done, whose equipment and staff are used, who bears the financial risk, and whether the person can profit or lose from the arrangement. A written agreement calling someone a contractor does not settle it.
When a reclassification happens, the practice owes the source deductions that should have been withheld, plus penalties and interest, and those amounts are held to have been in trust. Directors can be personally liable for them. That asymmetry is the reason to look at associate arrangements before CRA does. Our guide on T4 versus T4A covers the tests in detail.
Part-time hygienists and multiple employers
Hygienists frequently work across several practices. Each employer withholds CPP and EI independently, which means an individual can end up over-contributing across the year and reconciling it on their personal return. Your obligation is to withhold correctly on what you pay, and to issue an accurate T4, not to coordinate with other offices.
What does matter is treating part-time and casual hours correctly for vacation pay and statutory holiday entitlement under provincial employment standards, which is a payroll calculation rather than a tax one.
Remittances and slips
Source deductions are due by the fifteenth of the month after you pay your team for most small employers, and CRA charges a graduated penalty on late remittances that rises the longer they run. T4 and T4A slips are due by the end of February. Details of how the remittances work are in our guide on payroll remittances.
Because taxifi runs payroll inside the same service that keeps your books, each pay run posts straight into the practice accounts and the year-end slips reconcile to the remittances by construction. When staff leave, the Record of Employment goes to Service Canada on time, as covered in our ROE guide.
Ontario practices
Above the exemption threshold the Employer Health Tax applies, and WSIB coverage applies where the practice is required to register. Both are handled as part of the monthly service.
What’s included
- Pay runs for salaried, hourly, and part-time practice staff
- CPP, EI, and income tax source deductions calculated and remitted on time
- Associate arrangements reviewed for employee versus contractor treatment
- T4 and T4A slips prepared and filed at year-end
- Records of Employment filed with Service Canada when staff leave
- Ontario Employer Health Tax and WSIB where they apply
- Every pay run posted straight into the practice books
Also: Dentists in Ontario · Dentists in Toronto · Health & wellness. More for this industry: Dental accounting · Dental bookkeeping · Dental payroll
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Common questions
Are associate dentists employees or contractors?
It depends on the substance of the arrangement. CRA looks at who controls how the work is done, whose equipment and staff are used, who bears financial risk, and whether the person can profit or lose. A contract describing someone as a contractor does not settle the question.
What happens if an associate is reclassified as an employee?
The practice owes the source deductions that should have been withheld, plus penalties and interest. Because withheld deductions are held in trust, directors can be personally liable, so the exposure sits with the practice rather than the associate.
How do I handle a hygienist who works at several practices?
You withhold CPP, EI, and income tax correctly on what you pay and issue an accurate T4. Each employer withholds independently, so the individual reconciles any over-contribution on their personal return.
When are payroll remittances and slips due?
For most small employers, remittances are due by the fifteenth of the month after you pay your team, and T4 and T4A slips are due by the end of February. CRA charges a graduated penalty on late remittances.
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