The focus in HR as a profession moving forward is providing value to organizations. Here is one practical way you as an HR practitioner can do this within your organization. If you are a company that hires apprentices, here is a simple cost-saving tax break that you may not be aware of that allows for up to a $2000 tax credit to your organization per apprentice for wages paid to 1st and 2nd year apprentices.
The Federal Government offers an Apprenticeship Job Creation Tax Credit (AJCTC). The AJCTC is “a non-refundable tax credit equal to 10% of the eligible salaries and wages payable to eligible apprentices in respect of employment after May 1, 2006. The maximum credit an employer can claim is $2,000 per year for each eligible apprentice. If your business hires an “eligible apprentice”, you qualify to claim the credit.”
For details, visit the Canadian Revenue Agency website.
The website provides details on what qualifies as an eligible apprentice, and provides links to the appropriate tax forms.
As well, unused credits may be carried back three years and carried forward 20 years.
So, providing value. Say your organization has on staff an average of 5 eligible apprentices per year. Assuming each of these apprentices earn more than $20,000 per year, that’s an annual $10,000 tax credit your organization may be leaving on the table.
It doesn’t hurt to go to your accounting department and ask if this credit is being claimed. If it is, you make your department look proactive and financially focused. If it isn’t, then you have capitalized on an excellent opportunity. Put together a list of eligible apprentices including their annual earnings and social insurance number. Make a note on it letting the accountants know they need to look at page 12 of the T2SCH31 form for Corporations to claim the credit, then stand back and watch as the perception that HR is all about hiring and firing begin to change as HR beings being seen as a value-providing business partner.
And then come back to this blog and provide feedback! I’d enjoy hearing results from those of you who try this!
Tom Zabel