How To Enter Payroll Deductions
What you need to know:
AgExpert Accounting automatically includes the standard source deductions required for payroll processing. If your operation requires an additional deduction, you can create a custom deduction in settings or directly within an employee profile.
Deductions are maintained separately for arm's length and non-arm's length employees. Most employees are usually considered arm’s-length unless they are an owner or an owner’s family member. Non-arm's length employees include the business owner and their immediate family (for example, a spouse, parent, child, sibling, grandparent or grandchild).
Deductions created for one employee type are not automatically available for the other. When adding a deduction to an employee’s profile, only the deductions associated with that employee’s type will be displayed.
In AgExpert source deduction settings are prescribed and should not be modified.
What you need to do:
Identify the expense account that should be associated with the new deduction.
Determine if the deduction requires a remittance and what liability account will be used with it.
Identify if a deduction needs to be added to an employee’s T4 and/or RL-1 form.
Confirm if you need to add arm’s length and non-arm's length pay types.
How to (Step by Step):
To enter deductions through Settings:
Click Payroll.
Select Employees.
Click Settings.
Select Deductions.
Click Add.
Enter Name.
Tip: When adding a deduction, you are creating a deduction type available for all employees of the same type, so choose a generic name rather than one specific to an employee.
Select a CRA source from the drop-down menu.
Note: Any deduction that is not one of the five default deductions (CPP, EI, Federal tax, Provincial tax, Additional Ded. Tax) will be a Custom deduction.
Enter a Maximum annual contribution for the deduction, if applicable.
For Quebec residents: Choose the appropriate code from the Include on RL-1 Box? drop-down if the deduction should appear on a RL-1 form.
If the deduction should appear on a T4, use the Include on T4 box? drop-down menu.
If the deduction remittance requires a remittance, toggle the button on and:
a) Select a Remittance type with the drop-down menu or click Add new remittance type to enter the Name of a new remittance type.
b) Use the drop-down menu to select the liability account for the remittance.
If a remittance is not required for the deduction, use the drop-down menu to select an Income or expense account.
Click Save.
To enter deductions through an Employee profile:
Click Payroll.
Select Employees.
Click an employee.
Select Employment.
Click Add in the Deductions section and select Add new deduction.
Enter Name.
Tip: When adding a deduction, you are creating a deduction type available for all employees of the same type, so choose a generic name rather than one specific to an employee.
Select a CRA source from the drop-down menu.
Note: Any deduction that is not one of the five default deductions (CPP, EI, Federal tax, Provincial tax, Additional Ded. Tax) will be a Custom deduction.
Enter a Maximum annual contribution for the deduction, if applicable.
For Quebec residents: Choose the appropriate code from the Include on RL-1 Box? drop-down if the deduction should appear on a RL-1 form.
If the deduction should appear on a T4, use the Include on T4 box? drop-down menu.
If the deduction remittance requires a remittance, toggle the button and:
a) Select a Remittance type with the drop-down menu or click Add new remittance type to enter the Name of a new remittance type.
b) Use the drop-down menu to select the liability account for the remittance.
If a remittance is not required for the deduction, use the drop-down menu to select an Income or expense account.
Click Save.
Note: Source deduction settings are prescribed and should not be modified
References and Additional Resources
Still have questions? Contact support
Contact us at 1-800-667-7893 or email support@fccagexpert.ca if you require additional support. You can find other help options under the Question Mark Icon in the top right of AgExpert Accounting at any time.