Eg Of Tax Deduction In Payroll Flashcards
The tax payer must file revised TD1 forms
Each time the exemption changes during a year.
Example of deduction are
Tuition(full-time and part-time in the amount of the total tuition paid.
Spouse or common law partner amount
Disability amount
Caregiver amount for firm children under 18
Pension income amount
The amount of income tax withheld for an employee’s wages is determined by their wages and the amount of personal tax credits
1) Basic personal amount. $13,808
2)married or equivalent $13,808.
What is Canada pension plan rate
( CCP)
Is 5.45%
The rate is broken down into two parts on the tax return: 4.95% is the maximum non refundable tax credit
0.50% is allowed as a deduction from income and not a tax credit.
Employment insurance (EI)
Rete
1.58%
Other payroll Deductions are
Health insurance premiums
Employee credit union
Merchandise purchase from the company
Charitable organization eg(united way)
When must T4 statement be given:
On or before the last day if February
What is the benefits of Employment Insurance ?
To assist the unemployed financially until they get a job again.
Gross pay less deductions =
Net pay
Recording the payroll
Salaries Expense…. 2,050.00
Office salary Expense… $1,514.00
EI payable…. $ 56.31
Income tax payable… $392.20
Employee Hospital insurance payable….. 120.00
Cpp payable…… $172.23 =
Salaries payable
$2823.26
Salaries-expenses give net pay
Record payroll deductions
Office Salaries Expense… $481
Sales Salaries Expenses… 1,513.00
EI payable… 31.50
Income tax payable… 187.25
Employee health insurance payable… 120
Cpp payable.. 97.67
Union dues payable 45.00
Salaries payable. 1512.58
How to calculate gross wages including overtime? Of 50% rate
Regular wage rate.,. $75.00*50%=37.50
Regular you’re………. *8=$600
Regular pay = $600.00
Over time premium $37.50
Over time hours = 0
Total overtime pay= 0
Gross wages. . = 600.00
How to calculate vacation pay accrued for the week
Annual vacation… 2.5 weeks
Weeks worked in year… 49.5 weeks
Vacation pay as percentage of regular pay. 5.05%*600=30.30
Regular pay this week$600
What is the maximum EI earnings is
$889.54
