Our framework consists of:

• Tier 1: Compliance Foundation (CRA automation and remittances) 
• Tier 2: Scale Readiness (multi-province support and integrations)
• Tier 3: Growth Infrastructure (advanced reporting and international capabilities)

This strategic approach, part of EIM’s Complete Financial Tech Stack System, ensures your payroll choice supports both immediate needs and future growth without the costly migrations that derail 40% of scaling startups.

Why Canadian payroll is more complex than it looks 📚

Unlike in many other countries, Canadian payroll is governed at both the federal and provincial levels. That means your payroll system needs to calculate and remit the right deductions for things like CPP, EI, income tax, and provincial health premiums (where applicable).

It also requires filing T4s, producing pay stubs, managing vacation accrual, and staying in sync with CRA updates without expecting you to be the expert. Even minor mistakes can trigger fines, expose you to legal liabilities, or require extra work at year-end.

And if you’re working with a distributed team? You’ll need a system that supports multiple provinces, remits on your behalf, and gives both contractors and employees a good experience. This is where the Compliance Foundation tier of our framework becomes critical, getting the basics bulletproof before adding complexity.

The platforms founders ask about 🧠

The four tools we see most often among Canadian startups are Wagepoint, Humi, QuickBooks Workforce, and ADP. Each has its strengths, but not all are right for every company.

Wagepoint excels at Tier 1 requirements; it’s built specifically for Canadian small businesses, handles all CRA remittances, supports multiple pay schedules, and automates T4 and ROE (record of employment) generation. It’s simple, affordable, and integrates easily with QuickBooks or Xero. Founders love that it “just works” without a long learning curve.

Humi bridges Tier 1 and Tier 2 by combining payroll with HR features, including employee onboarding, time-off tracking, and document management. It’s ideal for startups growing headcount across multiple provinces and looking for one place to manage the full employee lifecycle. The tradeoff: slightly more complex implementation.

QuickBooks Workforce (previously KeyPay) is perfect for founders already deep into the QBO ecosystem as part of their broader financial stack. It maintains tight integration with accounting but may feel limiting for advanced HR workflows.

ADP represents full Tier 3 capabilities, enterprise-grade infrastructure that can feel like overkill for small teams but becomes valuable for startups anticipating rapid scaling and cross-border hiring.

Other tools like Deel and Rippling are excellent for startups hiring internationally or managing contractors abroad, but for Canadian-only payroll, they often bring more than you need.

Payroll under $10K/month vs. $100K/month: what changes 💸

Your payroll system needs to change as your team grows, which is exactly why EIM’s 3-Tier Payroll Selection Framework exists. A founder paying themselves and one contractor has different needs than a 25-person startup with health benefits and a few cross-border employees.

At Tier 1 (under $10K/month in payroll), simplicity and CRA automation are everything. You need a system that calculates, files, and remits without requiring constant oversight. Wagepoint often shines here, providing a rock-solid compliance foundation.

By Tier 2 ($100K+/month in payroll), priorities shift toward scale readiness. You need robust reporting, employee portals, integrated time tracking, and the ability to manage multiple provinces or jurisdictions. Humi and enhanced QBO configurations start making sense here.

Tier 3 represents growth infrastructure handling complex scenarios, international contractors, advanced benefits administration, and integration with sophisticated financial forecasting tools that complement our complete financial tech stack methodology.

The key is picking a tool that meets today’s needs without limiting tomorrow’s growth. Switching payroll systems mid-year is possible—but it’s rarely fun.

What happens if you miss CRA remittances? 🚨

Short answer: nothing good.

The CRA requires employers to remit payroll source deductions on time (monthly or with every pay run). If you miss a deadline, you’re subject to penalties and interest charges. Worse, recurring issues can trigger audits or limit your eligibility for government programs.

That’s why the Compliance Foundation tier focuses heavily on automation. Your payroll tool should calculate, submit, and confirm remittances, without you having to calendar every due date. A good system makes compliance invisible.

“An ounce of prevention is worth a pound of cure” – this couldn’t be truer for payroll compliance.

How EIM sets up payroll workflows that don’t break ⚙️

We don’t just pick a tool and hand it off. Our team helps startups design workflows around their unique structure, so payroll happens smoothly every cycle using our systematic approach.

That usually means:

• Automating remittances and tax slip generation (Tier 1)
• Ensuring clear classification between employees and contractors
• Syncing payroll data to bookkeeping tools like QuickBooks or Xero
• Setting up recurring reviews to confirm everything aligns
• Planning for scale readiness as the team grows (Tier 2)

We also map how each tool integrates with forecasting platforms within your broader financial infrastructure. Because payroll isn’t just a line item, it’s a strategic component of EIM’s Complete Financial Tech Stack System that drives hiring plans and burn projections.

Founders vs. contractors vs. employees: what to know 👥

One of the most common sources of confusion in early-stage payroll is role classification. Who’s an employee? Who’s a contractor? And what does CRA expect?

The distinction matters for both compliance and cost optimization. Employees require source deductions and regular filings. Contractors don’t, but misclassifying someone and you may be liable for back taxes, CPP contributions, and penalties.

Tools like Wagepoint and Deel make it easy to run mixed teams, but setup matters. We help founders clarify each role, document agreements properly, and ensure the payroll tool reflects those choices accurately.

When your team is small, these decisions can seem minor. But when you’re raising or being audited, they become material. Our framework ensures you get classification right from day one.

Final word: You don’t need to overbuild ✅

The best payroll software is the one that gets the job done without slowing you down. Founders don’t need every feature; they need peace of mind. If you’re spending more than a few hours a month on payroll or your remittance process feels manual, there’s a better way. We help startups streamline this from day one, so it doesn’t become a distraction later.

Want help finding the right payroll system for your team? Our payroll solutions integrate seamlessly with your complete financial infrastructure.

Natasha Galitsyna
Co-founder & Creator of Possibilities
7+ years in startups