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For BC Bookkeepers & Payroll Specialists

BC Employer Health Tax Calculator

Calculate British Columbia Employer Health Tax (EHT) for any payroll size. Updated for the 2024 budget threshold change ($1M small-employer exemption). Handles notch-zone math and separate non-profit thresholds.

Last updated: 2026-04-24

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$

Includes salaries, wages, bonuses, commissions, taxable benefits, and other remuneration.

Employer type

British Columbia EHT calculation

Effective rate: 1.950% of total payroll

Total BC remuneration
$1,500,000.00
− Threshold
−$1,000,000.00
= Notch-zone amount
$500,000.00
× Notch rate 5.850%
$29,250.00
= Annual EHT owed
$29,250.00
Quarterly installment (estimate)
$7,312.50
Annual EHT owed
$29,250.00

Installment estimate: $2,437.50 / month

In the notch zone — tax is calculated as 5.850% of remuneration above $1,000,000. The notch rate is set so that tax equals the full rate (1.95%) on total payroll exactly at $1,500,000.
Estimate only. Always verify against Government of British Columbia — Employer Health Tax before filing. Final liability depends on your specific employer classification, associated employer relationships, and current-year remuneration as defined by the relevant statute.

Reconcile BC EHT remittances against bank withdrawals

Year-end BC EHT reconciliation requires comparing payroll system totals against actual cash outflows. StatementsToExcel converts your BC bank statements (RBC, BMO, TD, Scotia, CIBC) to Excel in seconds.

How this calculator works

BC EHT has three zones depending on total BC remuneration:

  1. Exempt zone: BC payroll up to $1,000,000 (or $1,500,000 for registered charities and qualifying non-profits) — no EHT owing.
  2. Notch zone: $1M to $1.5M for standard employers. Tax is5.85% × (payroll − $1,000,000). The notch rate is set so that at exactly $1.5M payroll, the tax equals 1.95% × $1.5M ($29,250) — preventing a cliff. For non-profits the notch zone is $1.5M to $4.5M at 2.925%.
  3. Full-rate zone: Above $1.5M (or $4.5M for non-profits), the tax is simply 1.95% × full BC remuneration.

BC EHT installments are quarterly (June 15, September 15, December 15, March 31) when prior-year EHT exceeded $2,925. The annual return is due March 31.

Source & methodology

Rates and thresholds per the BC Government Employer Health Tax page. As of 2024, the small-employer exemption increased from $500,000 to $1,000,000 of BC remuneration. The notch zone ($1M to $1.5M for standard employers; $1.5M to $4.5M for charitable/non-profit) uses a higher marginal rate so that total tax converges to the full rate (1.95%) on full payroll at the upper threshold.

Frequently Asked Questions

What is the BC EHT exemption in 2024 onwards?
For standard employers, BC remuneration up to $1,000,000 is fully exempt. From $1,000,001 to $1,500,000, the tax is 5.85% of the amount above $1,000,000 (the "notch zone"). Above $1,500,000, the tax is 1.95% on the full BC remuneration. Charitable/non-profit employers have higher thresholds: $1.5M exemption, $1.5M-$4.5M notch zone at 2.925%, then 1.95% on full payroll.
Why does the rate jump at $1.5M?
It doesn't actually jump — it's smooth. The notch-zone rate (5.85%) is set precisely so that tax owed at exactly $1.5M of payroll equals 1.95% of $1.5M ($29,250). The notch is a phase-in mechanism that keeps the system continuous instead of creating a cliff.
When are installments required?
If your prior year's BC EHT exceeded $2,925, you must make installments. BC EHT installments are quarterly (June 15, September 15, December 15, March 31), with the annual return reconciling everything by March 31 of the following year.
What counts as BC remuneration?
Salaries, wages, bonuses, vacation pay, taxable benefits, employer RRSP contributions for employees, taxable allowances, and most other remuneration paid to employees who report to work in BC. Director's fees are also included. Pull these totals from your payroll system; cross-check year-end against the cash actually leaving your operating account using StatementsToExcel.

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