Canadian Payroll Upgrade

Background
Making Adjustments
Set up RPP Contributions
Set up EI
Set up QPIP

Background

This FAQ applies to those users of older MYOB versions of the Canadian software, and are upgrading to AccountEdge 2009 or later

If you have been writing paycheques using MYOB AccountEdge, you may need to make some adjustments to your data. The following processes must be done BEFORE you begin to write paycheques using AccountEdge 2009.

The required changes will vary depending upon the province of employment that was used in your file, and how you have addressed some of the payroll tax changes that have occurred in Canada during the past seven years.

If you simply edited the tax amounts that appeared on the paycheques, or created new deductions and employer expenses to calculate the correct withholding amounts for Canadian taxes that occurred in the past seven years, then you must make the adjustments to the payroll history for each employee.

Making Adjustments

To make these adjustments, simply move the total amounts in payroll history from the categories you have created to the appropriate tax category that appears in your file after you have upgraded to AccountEdge 2009. Once you have completed these adjustments for each employee, be sure to unlink the employees from the categories that you were using to track these taxes. This will avoid withholding the same tax amount twice.

If these adjustments are not made, it is likely that taxes will be over-withheld and AccountEdge will not be able to properly calculate the tax amounts for T4 and RL-1 reporting.

It is recommended that you load the new tax tables before writing any paycheques.

The following are examples of possible situations that would require these manual adjustments:

  • Ontario Health Premium: If you created a deduction category to calculate this payroll tax, you will need to transfer total amounts withheld to the Income Tax category.
  • EI-Quebec: If you used the existing EI category for Quebec employees, or if you created a deduction and employer expense category, you will need to transfer total amount withheld to AccountEdge's new EIQ tax and employer expense categories.
  • QPIP-Quebec: If you created a deduction and employer expense to calculate this payroll tax, you will need to transfer total amounts withheld to AccountEdge's new QPIP tax and employer expense categories.

The above mentioned changes may or may not be necessary, depending on your specific situation. Basically, any previously withheld amounts need to be associated with the category that AccountEdge 2009 will use for that calculation.

Set up RPP Contributions

According to the Revenu Quebec website, RPP Contributions are exempt from Quebec Income Tax. If you have not already done so, we recommend you mark this category exempt from Provincial Income Tax.

To mark a category as exempt from Provincial Income Tax:

  1. View the RPP Contribution deduction category.
  2. Click the Exempt button.
  3. Click the Provincial Income Tax to mark as exempt. Note that a check mark appears adjacent to selected tax.

Set up EI

The withholding rate for Employment Insurance for employees who work in Quebec is lower than for employees who work in other provinces. The associated employer expense has also been reduced. To account for these changes, a new tax EIQ-Employee Contribution and a new employer expense EIQ-Employer Contribution has been added.

Note: When the tax tables are loaded, the new tax and employer expense will be assigned to all employees who are setup to use the Quebec tax table and the previously existing tax and employer expense will be automatically deselected.

For Quebec employees, to ensure the proper calculation of the annual maximum deduction on EI contributions and your T4 reporting are correct, any accrued payroll history amounts should be added to the newly created EIQ tax and employer expense categories and the previously accrued payroll history should be cleared.

Note: Transferring the amounts can be done on a monthly, quarterly, or Year-to-Date basis, however transferring amounts on a monthly basis will yield better results for some of the payroll reports, such as the Payroll Register Summary.

The following steps need to be performed AFTER loading the new tax tables and BEFORE writing paycheques for each employee whose tax table is QC (Quebec), and for who has payroll history for EI tax and associated employer expenses:

  1. View the employee's card in the Card Information window.
  2. Select the Payroll Details tab and select Pay History.
  3. Select the desired period(s) to display the total pay history amounts for each category.
  4. If the amount shown to the right of the EIQ category, for your selected period, is 0, simply use the Cut and Paste edit commands to transfer the payroll history amounts from EI to EIQ.

Note: For each period, transfer the pay history amount to the right of the EI-Employee Contribution to the amount of the right of the EIQ-Employee Contribution.

  1. If the amount shown to the right of the EIQ category, for your selected period, is not 0, you will need to add the EI total amount to the EIQ total amount and then set the EI total amount to $0.00.
  2. Repeat the above steps for the EI and EIQ employer expenses.

Set up QPIP

To account for QPIP (Quebec Parental Insurance Plan) a new tax QPIP-Employee Contribution and an employer expense QPIP-Employer Contribution have been added.

Note: When the tax tables are loaded, the new tax and employer expense will be assigned to all employees who are setup to use the Quebec tax table.

For Quebec employees, to ensure the proper calculation of the annual maximum deduction on QPIP contributions and your RL-1 reporting are correct, any accrued payroll history amounts should be added to the newly created QPIP tax and employer expense categories and the previously accrued payroll history should be cleared. NOTE : Transferring the amounts can be done on a monthly, quarterly, or Year-To_Date basis, however transferring amounts on a monthly basis will yield better results for some of the payroll reports, such as the Payroll Register Summary.

The following steps need to be performed AFTER loading the new tax tables and BEFORE writing paycheques for each employee whose tax table is QC (Quebec), and for who has payroll history for the manually created Quebec Parental Insurance Plan category:

  1. View the employee's card in the Card Information window.
  2. Select the Payroll Details tab and select Pay History.
  3. Select the desired period(s) to display the total pay history amounts for each category.
  4. If the amount shown to the right of the previously created category, for your selected period, is 0, simply use the Cut and Paste edit commands to transfer the payroll history amounts from the previously created category to the new QPIP category.
    Note: For each period, transfer the pay history amount to the right of the previously created category to the amount of the right of the QPIP-Employee Contribution.
  5. If the amount shown to the right of the previously created QPIP category, for your selected period, is not 0, you will need to add the total amount of the previously created QPIP category to the New QPIP category and then set the previously created QPIP total amount to $0.00.
  6. Repeat the above steps for the Quebec Parental Insurance Plan employer expenses.
  7. Deselect the previously created categories for Quebec Parental Insurance Plan from all employees to avoid withholding twice the amount.