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Module 4 Online Exercise Solution
Payroll & Benefits ACCT-1076
Purpose:
Determine an employee’s gross pay, statutory deductions and net pay by calculating the amount using CRA’s payroll tables and using CRA’s Payroll Deductions Online Calculator (PDOC).
Required:Research the CPP and EI information on the CRA website in order to complete the following two charts:
| CPP | 2019 | 2020 | 2021 |
| Maximum annual pensionable earnings | $57,400 | $58,700 | $61,600 |
| Basic exemption amount | $3,500 | $3,500 | $3,500 |
| Maximum contributory earnings | $53,900 | $55,200 | $58,100 |
| Contribution rate | 5.10% | 5.25% | 5.45% |
| Maximum annual employee contribution | $2,748.90 | $2,898.00 | $3,166.45 |
| Maximum annual employer contribution | $2,748.90 | $2,898.00 | $3,166.45 |
| EI | 2019 | 2020 | 2021 |
| Maximum annual insurable earnings | $53,100 | $54,200 | $56,300 |
| Rate | 1.62% | 1.58% | 1.58% |
| Maximum annual employee premium | $860.22 | $856.36 | $889.54 |
| Maximum annual employer premium | $1,204.31 | $1,198.90 | $1,245.36 |
See below for calculations and Payroll Deduction Online Calculator results.
NOTE: The income tax amounts using the Payroll Deduction Tables will differ from the Payroll Deduction Online Calculator (PDOC) results. This is because the Payroll Deduction Tables provide the tax amount for a range of taxable income while the PDOC provides an exact calculation.
Part 1: Joey Chance Gross Earnings:
| Salary (52,000/24) | $2,166.67 | |
| Car allowance | 175.00 | |
| Total Gross Earnings | $2,341.67 | |
| Less: Statutory deductions | ||
| CPP | 121.31 | |
| EI | 37.00 | |
| Income tax | 404.05 | |
| Total taxes | 562.36 | |
| Less: Other deductions | ||
| Employee RRSP | 100.00 | |
| Net pay | $1,679.31 |
| Statutory deductions calculations: | CPP | EI | Income tax |
| Gross earnings | 2,341.67 | 2,341.67 | 2,341.67 |
| Add: Non-cash taxable benefits (cell phone) | 30.00 | N/A | 30.00 |
| Less: Non-taxable allowances | |||
| Pensionable/Insurable Earnings/Gross taxable income | 2,371.67 | 2,341.67 | 2,371.67 |
| Less: exemption amount (3,500/24) | (145.83) | N/A | N/A |
| Contributory earnings | 2,225.84 | ||
| Rate | 5.45% | 1.58% | |
| CPP / EI | 121.31 | 37.00 | |
| Less: Employee RRSP | (100.00) | ||
| Net taxable income | 2,271.67 | ||
| Federal income tax (look up on payroll deduction tables*) | 213.50 | ||
| Provincial income tax (look up on payroll deduction tables*) | 190.55 | ||
| Total income taxes | 404.05 |
* 2021 semi-monthly Federal and Manitoba Payroll Deduction Tables found here: https://www.canada.ca/content/dam/cra-arc/migration/cra-arc/tx/bsnss/tpcs/pyrll/t4032/2021/t4032- mb-1-24pp-21eng.pdf
Joey Chance-(EE)-PDOC-Date paid-2021-04-30.pdf
Payroll Deductions Online CalculatorResult
Employee's name: Joey Chance
Employer's name: Telecero Communications Ltd.
Pay period frequency: Semi-monthly (24 pay periods a year)
Date the employee is paid: 2021-04-30 (YYYY-MM-DD)
Province of employment: Manitoba
Federal amount from TD1: 16,181.01 - 18,554.00 (Claim Code 3)
Provincial amount from TD1: 11,629.01 - 13,322.00 (Claim Code 3)
| Salary or wages income | 2,166.67 | ||
| Taxable benefit paid in cash | 175.00 | ||
| Total cash income | 2,341.67 | ||
| Taxable income for the pay period | 2,271.67 | ||
| Pensionable earnings for the pay period | 2,371.67 | ||
| Insurable earnings for the pay period | 2,341.67 | ||
| Federal tax deduction | 213.21 | ||
| Provincial tax deduction | 188.98 | ||
| Total tax deductions on income | 402.19 | ||
| CPP deductions | 121.31 | ||
| EI deductions | 37.00 | ||
| Amounts deducted at source | 100.00 | ||
| Total deductions | 660.50 | ||
| Net amount | 1,681.17 | ||
| Total benefit paid in cash Cash, insurable for EI | 175.00 | ||
| Taxable benefits (non-cash) Non-cash, not insurable for EI | 30.00 | ||
| Amounts deducted at source Employee contribution to RRSP | 100.00 | ||
| Year-to-Date Amounts Inputted Value | Total for this Record | ||
| Pensionable earnings 13,264.86 | 15,636.53 | ||
| CPP contributions 532.14 | 653.45 | ||
| Insurable earnings 12,730.38 | 15,072.05 | ||
| EI premiums 201.14 | 238.14 |
The printed calculations created by PDOC are not intended to be used as a statement of earnings. Please contact your employment standards representative for all of the information legally required on a statement of earnings specific to your province or territory.
Created by the Payroll Deductions Online Calculator Page 1 of 1 Saved on 2021-12-14
Part 2: Lilian Worthy Gross Earnings:
| Regular earnings ($22.00 x 40 hours) | $ 880.00 | |
| Overtime ($22.00 x 5 hours x 1.5) | 165.00 | |
| Vacation pay ($880.00 x 4%) | 35.20 | |
| Total Gross Earnings | $1,080.20 |
Less: Statutory deductions
CPP n/a
EI 17.07
Income tax 204.30
Total statutory deductions 221.37
Less: Other deductions
Union dues 10.00
Net pay $ 848.83
| Statutory deductions calculations: | CPP | EI | Income tax |
| Gross earnings | 1,080.20 | 1,080.20 | 1,080.20 |
| Add: Non-cash taxable benefits (gift) | 5.00 | N/A | 5.00 |
| Less: Non-taxable allowances | |||
| Pensionable/Insurable Earnings/Gross taxable income | 1,085.20 | 1,080.20 | 1,085.20 |
| Less: exemption amount (3,500/52) | (67.31) | N/A | N/A |
| Contributory earnings | 1,017.89 | ||
| Rate | 5.45% | 1.58% | |
| CPP / EI | Exempt | 17.07 | |
| Less: Union dues | (10.00) | ||
| Net taxable income | 1,075.20 | ||
| Federal income tax (look up on payroll deduction tables*) | 110.30 | ||
| Provincial income tax (look up on payroll deduction tables*) | 94.00 | ||
| Total income taxes | 204.30 |
* 2021 weekly Federal and Manitoba Payroll Deduction Tables found here:
t4032-mb-52pp-21-eng (canada.ca)
Lillian Worthy-(EE)-PDOC-Date paid-2021-03-27.pdf
Payroll Deductions Online Calculator
Result
| Employee's name: | Lillian Worthy |
| Employer's name: | Lunible Inc |
| Pay period frequency: | Weekly (52 pay periods a year) |
| Date the employee is paid: | 2021-03-27 (YYYY-MM-DD) |
| Province of employment: | Manitoba |
| Federal amount from TD1: | 13,808.01 - 16,181.00 (Claim Code 2) |
| Provincial amount from TD1: | 9,936.01 - 11,629.00 (Claim Code 2) |
| Salary or wages income | 1,045.00 |
| Vacation pay | 35.20 |
| Total cash income | 1,080.20 |
| Taxable income for the pay period | 1,075.20 |
| Pensionable earnings for the pay period | 0.00 |
| Insurable earnings for the pay period | 1,080.20 |
| Federal tax deduction | 119.13 |
| Provincial tax deduction | 100.20 |
| Total tax deductions on income | 219.33 |
| CPP deductions | 0.00 |
| EI deductions | 17.07 |
| Amounts deducted at source | 10.00 |
| Total deductions | 246.40 |
| Net amount | 833.80 |
| Taxable benefits (non-cash) | |
| Non-cash, not insurable for EI | 5.00 |
| Amounts deducted at source | |
| Union dues | 10.00 |
| Year-to-Date Amounts | Inputted Value | Total for this Record |
| CPP contributions | Exempt | |
| Insurable earnings | 2,516.50 | 3,596.70 |
| EI premiums | 39.76 | 56.83 |
The printed calculations created by PDOC are not intended to be used as a statement of earnings. Please contact your employment standards representative for all of the information legally required on a statement of earnings specific to your province or territory.
Part 3: Max Power
Gross Earnings:
| Salary ($2,000 x 12 / 26) | $ 923.08 | |
| Safety shoe allowance | 100.00 | |
| Total Gross Earnings | $1,023.08 | |
| Less: Statutory deductions | ||
| CPP | 43.52 | |
| EI | 14.58 | |
| Income tax | 97.65 | |
| Total taxes | 155.75 | |
| Less: Other deductions | ||
| Employee RRSP | - | |
| Net pay | $ 867.33 |
| Statutory deductions calculations: | CPP | EI | Income tax |
| Gross earnings | 1,023.08 | 1,023.08 | 1,023.08 |
| Add: Non-cash taxable benefits (parking) | 10.00 | N/A | 10.00 |
| Less: Non-taxable allowances | (100.00) | (100.00) | (100.00) |
| Pensionable/Insurable Earnings/Gross taxable income | 933.08 | 923.08 | 933.08 |
| Less: exemption amount (3,500/26) | (134.62) | N/A | N/A |
| Contributory earnings | 798.46 | ||
| Rate | 5.45% | 1.58% | |
| CPP / EI | 43.52 | 14.58 | |
| Less: Union dues or RRSP’s | |||
| Net taxable income | 933.08 | ||
| Federal income tax (look up on payroll deduction tables*) | 44.15 | ||
| Provincial income tax (look up on payroll deduction tables*) | 53.50 | ||
| Total income taxes | 97.65 |
* 2021 bi-weekly Federal and Manitoba Payroll Deduction Tables found here:
t4032-mb-26pp-21-eng (canada.ca)
Note: The Safety Shoe Allowance is a cash non-taxable allowance and must be added manually when using the Payroll Deductions Online Calculator.Max Power-(EE)-PDOC-Date paid-2021-02-27.pdf
Payroll Deductions Online Calculator
Result
| Employee's name: | Max Power |
| Employer's name: | Kideo Games |
| Pay period frequency: | Biweekly (26 pay periods a year) |
| Date the employee is paid: | 2021-02-19 (YYYY-MM-DD) |
| Province of employment: | Manitoba |
| Federal amount from TD1: | Minimum - 13,808.00 (Claim Code 1) |
| Provincial amount from TD1: | Minimum - 9,936.00 (Claim Code 1) |
| Salary or wages income | 923.08 |
| Total cash income | 923.08 |
| Taxable income for the pay period | 933.08 |
| Pensionable earnings for the pay period | 0.00 |
| Insurable earnings for the pay period | 923.08 |
| Federal tax deduction | 44.33 |
| Provincial tax deduction | 53.23 |
| Total tax deductions on income | 97.56 |
| CPP deductions | 43.52 |
| EI deductions | 14.58 |
| Total deductions | 155.66 |
| Net amount | 767.42 |
|
Add: safety shoe allowance* 100.00 Net pay 867.42 | |
| Year-to-Date Amounts | Inputted Value | Total for this Record |
| Pensionable earnings | 2,296.61 | 3,229.69 |
| CPP contributions | 103.15 | 146.67 |
| Insurable earnings | 2,276.61 | 3,199.69 |
| EI premiums | 35.97 | 50.55 |
The printed calculations created by PDOC are not intended to be used as a statement of earnings. Please contact your employment standards representative for all of the information legally required on a statement of earnings specific to your province or territory.
* Note: The Safety Shoe Allowance is a cash non-taxable allowance and must be added. manually
