New Employee Forms: How to stay on top of essential government forms

Following the exciting acceptance of an offer letter for a new hire, comes the paperwork. But never fear. What may seem like an impossible task is easy when you know which forms new employees must fill out as you onboard them.  

When you’ve hired a new employee, one of the most extensive parts of their onboarding experience is having them fill out necessary forms and paperwork. New employee paperwork includes the essential information and documentation that you, as an employer, are legally required under both provincial and federal law to obtain from your new hire when they begin working for you, and before you can run payroll. 

New employee forms are necessary for proper filing and management of staff and enable the organization to keep track of each employee’s information. 

While administered by the company, new employee forms are filled out by the employee and then shared with the operations or human resources department and subsequently filed into the new employee’s file.  

Our guide aims to outline the most important new hire forms that you will be required to have your new employees complete. 

What exactly are new employee forms?

Among the many forms that an organization must maintain, new employee forms are among the most critical documents. These documents must be filled out by new hires before employment officially begins. 

The forms are essential for tracking information such as the new employee’s official hire date, tax information, details of the new hire’s compensation package, non-disclosure agreements, or non-compete contracts and payroll information. There are two primary new employee forms that you must obtain in Canada for payroll deductions and tax purposes. Read below to learn more. 

Have the Employee Fill out Required Forms

Form TD1 

Form TD1, otherwise known as the Personal Tax Credits Return, is used to determine how much tax is deducted from an employee’s income. A new hire must complete both the federal TD1 and the provincial TD1 if more than the necessary personal amount is claimed. In Quebec specifically, employees must use the TD1 (federal) and the provincial Form TP1015.3-V, Source Deductions Return. 

Provincial and federal forms can be found here. 

Your employees must complete this as soon as possible. It is in your best interest to have this as part of their onboarding, and file it immediately. 

Always make sure to review the information that you are inputting for payroll deductions, which can include: income tax, employment insurance Canada Pension Plan (CPP) deductions, and taxable benefits.  

Social Insurance Number (SIN) 

As an employer in Canada, you have to ask your employees for their SIN within three days of working for you and record their number. Here are a few things to not when registering a new employee’s SIN.

1. If an employee has not shared their SIN with you, you are legally obligated to inform Service Canada within six days of their start date, notifying them that they have not given you their SIN.
   
   
2. Recording incorrect SINs are detrimental for your new hire’s Canadian Pension Plan (CPP) benefits. If you file an incorrect SIN on a form such as a T4, which includes pension remittances, it can ultimately lead to an inaccurate Registered Retirement Savings Plan (RRSP).
   

When you hire a new employee who is not a Canadian Citizen or a permanent resident of Canada, you must be sure that the employee’s SIN begins with 9, that their SIN is not expired, and possess a valid work permit.

Implications of not completing new employee forms or providing a SIN

Remember, if an employee works for you and you cannot obtain their SIN or a completed Form TD1, you, as the employer, are still responsible for calculating and withholding payroll deductions.

Employees do not have to fill out new TD1 forms every year if their tax credit amounts have not changed.

If an employee refuses your request for their SIN, you must provide evidence to the government that you've made a “reasonable effort” at obtaining it. 

The CRA (Canadian Revenue Agency) defines a “reasonable effort” as providing proof or a paper trail (emails, verbal or written communications) asking your employee for their SIN. 

Those who do not fill out new employee forms may be penalized $25 for each day the form is late. The minimum penalty is $100 and increases by $25 per day to a maximum of $2,500. 

Related: What is EI?