EEHT and PWHT Deductions in Canada Explained

If you notice EEHT and PWHT deductions on your payslip, you may be wondering what they entail.

Let’s find out! 

EEHT and PWHT deductions

Meaning of EEHT Deduction

The EEHT deduction stands for “Employment Earnings History Transcript,” which is a deduction from your paycheque related to employment insurance.

It’s a contribution toward your future entitlement to employment insurance benefits.

The EEHT deduction is a mandatory contribution for most employees in Canada, which goes towards funding the employment insurance program.

The amount deducted is calculated based on your earnings, and there’s typically a maximum insurable earnings limit that applies.

Contributions to employment insurance provide benefits such as maternity and parental leave, sickness benefits, and employment assistance.

Meaning of PWHT Deduction

The PWHT deduction stands for “Provincial Withholding Tax,” which is a deduction for provincial income tax withheld from your paycheque by your employer. 

This tax is based on your income amount and the provincial tax rates applicable to your income level.

The PWHT deduction is the provincial counterpart to federal income tax withholding.

The amount withheld depends on your income level and the provincial tax rates applicable in your province or territory.

Finally, the withheld amount is remitted to the provincial/territorial government on your behalf to fulfill your provincial income tax obligations. 

Final Words

Employers are responsible for deducting EEHT and PWHT amounts from your paycheques and remitting them to the appropriate government agencies.

Your employer should provide you with a pay stub or payslip, detailing the amounts deducted and the periods covered.

Understanding these deductions can help you better manage your finances and plan for tax obligations. 

If you have specific questions or concerns about your deductions, contact your employer or consult with a tax professional.

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