Test 2

Question 1

Who is assisted through EI?

Answer 1

Canadians without sick leave, pregnant individuals/ adopting, those who caring for a ill individual.

Question 2

What are the penalties for late remitting?

Answer 2

3%: 1-3 days
5%: 4-5 days
7%: 6-7 days
10%: 8 or more days late

Question 3

Liz earns $1,350.00 per pay period. She also receives a Life Insurance taxable benefit valued at $25.00. What is the total EI Premiums Payable? (assume the employee multiplier is 1.4)

Answer 3

Employee (EE): 1350 x 1.62% = $21.87
Employer (ER): 21.87 x 1.4 = 30.62

Total EI Premiums payable =21.87+ 30.62
= 52.49

Question 4

Liz earns $1,350.00 per pay period. She also receives a car allowance of $450.00 per pay. What is her total EI Premiums payable? (assume the employee multiplier is 1.4)

Answer 4

Employee (EE): (1350 + 450) x 1.62% = 29.16
Employer (ER): 29.16 x 1.4 = 40.82
Total EI Premiums payable = 29.16 + 40.82
= 69.98

Question 5

Susie Earns a Income of 2,525 monthly. Using the tables what would be her Federal and provincial tax Deductions?(Fed code 2, Prov code 3)

Answer 5

Federal: 175.80
Provincial: 85.70

Question 6

What is the purpose of CPP?

Answer 6

To provide income to those retired, disabled, ill or widowed.

Question 7

What is another term used for CPP given to a dead individual

Answer 7

survivor’s pension

Question 8

Kim is paid 9,000 monthly at her company, what is her CPP exemption she can claim per pay period?

Answer 8

3500 (basic exemption) / 12 (monthly pay) = 291.66

Question 9

Who must contribute to CPP?

Answer 9

Those between the ages of 18 - 70 years (unless elected to stop payments at 65 years of age)

Question 10

Justin just turned 18 on March 5th. When must he start paying into CPP and How much will be pay at max into CPP for the year?

Answer 10

Justin’s first payment starts in April.

2748. 90 / 12 = 229.08
2749. 08 * 9 = 2061.72

Question 11

When does someone issue a Record of Employment?

Answer 11

• each time an employee has an interruption of earnings
• ending employment
• when Service Canada requests it
• when the pay period changes
• when there is a change in ownership
• the owner declares bankruptcy
• a self-funded employee leave occurs

Question 12

Who issues the Record of Employment?

Answer 12

The employer

Question 13

What is an insurable hour?

Answer 13

Each hour physically worked and paid regardless of the rate of pay

Question 14

What makes up GPTI? (Gross Pensionable / Taxable Income)

Answer 14

Earnings + taxable allowances + cash taxable benefits + non-cash taxable benefits

Question 15

What are common deductions made to GPTI to get Net Federal and Provincial taxable income?

Answer 15

• Employee contributions to an RPP
• Employee contributions to an RRSP
• Union Dues

Question 16

Define Pensionable Earnings

Answer 16

A person’s contributory wages and salary for CPP (which includes wages, salaries, and gratuities)