Understanding Payroll Systems

Canadian payroll is so simple!  You just need to know a few key rules and your set!  Five options as I see it-

1. Do it yourself- definitely the cheapest!  https://apps.cra-arc.gc.ca/ebci/rhpd/startLanguage.do?lang=English

Go to this site, fill out the online form, print out the paystub, grab your chequebook, fill out the cheque and the stub of course with the gross amount, the net pay, the CPP, the EI and to help your bookkeeper put a quick note and calculate the business expense portion which is the CPP + 1.4* the EI amount! example 2,500 pay.  If you are doing it yourself I recommend that you pay out the statutory 4% vacation.  Hit your EI and CPP maximum’s (http://www.payworks.ca/Info/Resources/Guide/CPPEI.asp) and you stop withholding them and stop paying the Company portion!  Pretty simple eh!  

Other hints- avoid group MSP- Medical Services plan as it complicates everything and doesn’t really end up helping employee out that much- just pay them more hourly/salary and let them pay their own!  Reiburse for cellphone use for work!  Definite early pre-tax expense!

You withhold the taxes and company CPP and EI each paycheque (this all goes into Payroll liabilities account) and then you pay it out by the 15th of the following month.  You should make sure that the payroll liabilities account is clearing out regularly.  Payroll remittance payments can be done using online banking (easiest!) but you need to process generally one day in advance of the due date- ie. process on the 14th.  If you miss this cut a cheque and drop at your bank or CRA office along with a copy of the PD7A.  

Example PD7A

Example PD7A

 

 

G/L best practices- don’t get insane with all the G/L line items -ie. EI expense, CPP Expense, EI withholdings, CPP witholdings, Tax withholdings is as bad is can get.  2 does the job!  Payroll tax expense (CPP & EI) and Payroll liabilities!  Just make sure the payroll liabilities are clearing out each month.  You can setup a Payroll tax expense for each Department.

2.  Use Quickbooks or Simply!  These are pretty easy to use applications and great if you’re doing the bookkeeping at the same time!  Ideally you have your bookkeeper crank out the payroll for you – plug for Tandem Accounting of course!  There are few tricks to help you get your payroll to flow into chart of accounts nicely by department and by employee for so really nice reporting capabilities.  You need to pay the annual fee for payroll tables.  These track payroll withholdings, CPP, EI nicely as well as vacation, taxable benefits, etc.  They print nice paycheques or paystubs!  I recommend www.hyperwallet.com for direct deposit even though they don’t advertise it and don’t count on much support.  It is dead simple and only 0.75/paycheque and clears in like 2 days if you process in morning.  If you use Telpay (the QB’s default) get ready for a serious learning curve and a GUI from hell!

3. Payworks

Slick and very cost effective.  Quickly has become our payroll provider of choice in Canada.   When you grow beyond super cash management you want to hook this up to simplify payroll process and year end T4’s.  You’ll still need QCDocs to help with hourly employees or vacation/sick day tracking.  Big issue with payroll providers is you’ve got to fund 100% of your payroll each payday… they make some money presumably on the remittance timing to the following mid month date!?

4. Ceridian- close second to Payworks.  Works well but a few extra hoops to jump through and marginally more expensive then Payworks.

5. ADP- Oh why, why can’t you be more like your big brother software from the USA!?  I was shocked to move back to Canada and immediately started using ADP assuming it would be the same as the US software- big mistake.  I’m not sure they’ve upgraded this application in 15 years?  I still don’t get it… see point 1!?

Where does QCDocs fit in- whatever payroll system you use you will distribute paystubs and archive payroll reports- QCDocs does just this.  Also hourly employees or billable hours need to be recorded by employees- QCDocs streamlines this right into accounting applications or aggregates it for entry into payroll system.  It also trackes vacation and sick days as well!

20 Comments »

  1. guitar tricks said,

    March 28, 2016 @ 8:57 am

    The secret too singing and playing at the
    identical time is to be proficient first
    with guitar after which add your voice.

  2. Milford interior decorator said,

    April 6, 2016 @ 10:52 pm

    A decorator can help within the Refreshing of a rom by Repurposing and Repositioning pieces to create a brand new look.

  3. Judi Domino99} said,

    April 21, 2016 @ 10:56 pm

    I blog often and I seriously appreciate your information. Your article
    has truly peaked my interest. I am going to bookmark your site and keep checking for new
    details about once a week. I opted in for your RSS feed as
    well.

  4. car spy camera said,

    May 14, 2016 @ 5:00 am

    After looking at a number of the articles on your web page, I really appreciate your way of writing a
    blog. I added it to my bookmark webpage list and will
    be checking back soon. Please check out my web site as well and
    let me know your opinion.

  5. 男性向けダイエットサプリ said,

    May 21, 2016 @ 1:46 pm

    男が飲むダイエットサプリ、としましては糖質カットのサプリメントをおすすめします。それは白米とかそばを食べたときの糖質吸収をカットしてくれるという事です。
    つまり、白米やうどんをがっつり食べる男性には相性の良いサプリメントなんです。

  6. www.doggycatacademy.com said,

    June 29, 2016 @ 3:06 pm

    Generally, dog owners will discover the inguinal swelling or feeel it by
    touch by palpating the groin space Normally, lymph nodes are barely
    in a position to be felt and are pea-sized.

  7. joanne joplin said,

    July 23, 2016 @ 5:05 pm

    Interesting piece , Coincidentally , if your company needs a a form , my wife filled out a template document here https://goo.gl/Pz2jKv.

  8. flagyl said,

    August 19, 2016 @ 7:28 pm

    Aw, this was a really good post. Spending some time and
    actual effort to create a top notch article… but what can I say…
    I procrastinate a whole lot and don’t manage to
    get anything done.

  9. Garrett said,

    September 7, 2016 @ 8:09 pm

    Subluxation.

  10. www.lisaolson.co.uk said,

    September 9, 2016 @ 3:39 pm

    The ideas and theories created by the students during that
    time have survived generrations aand are proving to be
    truje at the moment. Even if there is not sciedntific evidence to quantify utilizing the
    Chinese baby calendar to have a girl, the idea continues to be steeped in enough historic knowledge to be value a shot.

  11. Marijuana doctors said,

    September 11, 2016 @ 9:10 am

    With the help of medicinal marijuana faculties and programs, it is going to be
    doable to arrange yourself to enter oone in evfery
    of several quickest growing industries in the US.
    Even if you are unacquainted with thee current state laws and the way it’s possible to open your individul dispensary,
    the courses you take up woujld require you thru every thing step-by-step.

  12. Kathie said,

    November 10, 2016 @ 8:38 pm

    Thee flowers should be small this makes them simpler to work with.

  13. Bruce said,

    November 16, 2016 @ 4:52 am

    Rewards.

  14. montreal office cleaning said,

    November 29, 2016 @ 1:36 am

    This hardwod ground cleansing system is the primary one
    that basicaly works effectively on all types of
    hardwood flooring.

  15. Brendon R said,

    March 20, 2017 @ 12:00 pm

    Want to put your employee pay stubs online without switching your accounting software? There is a product called Instaff that integrates with your existing software and gives your employees an online site t view pay stubs and other information. For more info go to:

    http://www.instaff.org

  16. here said,

    October 18, 2017 @ 12:45 pm

    Hi there, after reading this awesome post i am also delighted to share my know-how here with mates.

  17. here said,

    October 18, 2017 @ 1:17 pm

    I feel that is among the most significant information for me.
    And i’m satisfied reading your article. But want to statement
    on some normal things, The site style is perfect, the articles is truly nice :
    D. Good task, cheers

  18. source said,

    October 28, 2017 @ 5:25 am

    That is a good tip especially to those fresh to the blogosphere.
    Short but very accurate information… Many thanks for
    sharing this one. A must read article!

  19. source said,

    November 4, 2017 @ 10:31 am

    whoah this weblog is great i like studying your articles.
    Keep up the great work! You understand, lots of persons are looking
    round for this information, you could aid them greatly.

  20. here said,

    November 13, 2017 @ 1:39 pm

    It’s really a cool and helpful piece of info.

    I’m satisfied that you simply shared this useful information with us.
    Please stay us up to date like this. Thank you for sharing.

RSS feed for comments on this post · TrackBack URI

Leave a Comment