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Canada Tax Info |
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GENERAL CANADA TAX INFO Canada Tax BasicsCanada includes three basic payroll taxes:
Entering Employee InfoTo calculate federal and provincial income taxes correctly, enter the following information for each Employee account:Tax Credits-- Take the amount claimed by the employee as Tax Credits according to the “Total of personal tax credit amounts” indicated on Form
TD1, multiply it by 0.17, and enter the result into the Federal Dollar Amount field in each employee account. Other Credits-- Enter any other federal tax credits as an annual amount in the Local Dollar Amount field in the Employee account. Examples
of these are medical expenses or charitable donations authorized by a tax centre or tax services office. Tax Factors-- Enter the sum of tax factors F, F2 and U1 into the State Dollar Amount field in each Employee account. To obtain an annual amount, add the factors for one week, and multiply by 52.
LCF Deduction-- If an employee takes the LCF deduction, enter the tax credit into the Tax Item called LCF: Federal labour-sponsored. To
determine the amount to use for LCF for each employee, take the lesser of $750; and 15% of the annual deduction for the employee's purchase of approved
shares of capital stock of a prescribed labour-sponsored venture capital corporation. You'll also need to create a Tax Package for
the employees who take the deduction, and include this deduction for them. If two or more employees use different amounts for LCF, each one will
require a separate tax item with the correct amount (and separate Tax Packages). LCP Credits-- If your business is located in a province that allows tax credits for LCP, the labour-sponsored funds annual provincial tax credit,
you must enter the appropriate amount for any employee claiming LCP credits in the LCP tax item for your province. Provinces that allow this credit
are Nova Scotia, New Brunswick, Ontario, Manitoba, Saskatchewan, British Columbia, Northwest Territories and Nunavut. Ontario EmployersEnter into each Employee account the sum of the number of dependents under age 18 and the number of dependents with disabilities. Enter this value in the Local Exemptions field in each employee account.British Columbia EmployersEnter into each employee's account the number of dependents. Enter this value in the Local Exemptions field in each employee's account.Tax ReferencesEmployer's Guide: Payroll Deductions (Basic Information)Employer's Guide: Remitting Payroll Deductions Payroll Deductions Formulas for Computer Programs Employer's Guide: Taxable Benefits Employer's Guide: Filing T4 and T4F Slips and Summary Forms (Includes Form RC104) Employer's Guide: Filing the T4A Slip and Summary Form Payroll Deductions Tables (available for each Province or Territory, and for businesses or employees located outside Canada or outside the boundaries of any Province or Territory) These publications are available from the Canada Customs and Revenue Agency and can be ordered at the following toll free number: 1-800-959-2221 , or from their web site at www.ccra-adrc.gc.ca. Main Page | Accounts | Lists | Transactions | Menus | Index | Website | User Page |