2018 Year End/New Year Payroll Checklist

Year end is a busy time in the payroll department. To help you through, the  Canadian Payroll Association has created this checklist of action items. We hope you find it useful!

START-UP
  • Create a year-end reference file
  • Determine which forms will be required (T4, T4A)
  • Download guides and forms from the CRA
  • Hold a year-end meeting with stakeholders (IT, HR, Finance)
BALANCE & RECONCILE
  • Balance payroll tax account remittances to payroll register
  • Reconcile payroll bank account for outstanding entries to payroll
    • manual cheques
    • void/cancelled cheques
    • investigate any stale-dated cheques
  • Update any manual or cancelled cheques to payroll
  • Conduct self-PIER audit of CPP & EI deductions
  • Remit outstanding CPP & EI with or before final remittance for tax year
  • Run test T4 slip and summary report
  • Balance T4 report to payroll register - validate earnings and deductions are reporting in correct boxes
  • Ensure accurate social insurance numbers are reported
  • Update WCB awards reimbursed to employer

TAXABLE BENEFITS

  • Taxable benefits reported each pay when received or as enjoyed
  • Process taxable benefit adjustments e.g. company car benefits
  • Validate benefits are reported in all required boxes on tax slips

PENSION ADJUSTMENT

  • Validate pensionable earnings per company plan document
  • Calculate pension adjustment
  • RPP registration number reporting in Box 50 for all plan members
  • Reporting of taxable refunds if necessary

FILING PROCEDURES

  • Choose filing method (paper, on-line, XML)
  • Choose method of delivery to employees (electronic or paper)
  • Make note of filing deadlines and penalties for non-compliance
  • Establish policies & procedures for amending or cancelling slips
  • File slips and summaries with CRA

JURISDICTIONAL REPORTING

  • Employer health tax returns
  • Workers compensation annual reconciliation/return

YEAR-END ACCOUNTING

  • Year-end accruals
  • Reconcile all payroll related GL accounts
  • Validate earnings and deductions are charged to correct GL cost center account

SET-UP FOR NEW PAYROLL YEAR

  • Review payroll calendar for payroll processing/pay day conflicts (statutory holidays etc.)
  • Weekly or bi-weekly pay frequency watch for 53/27 pay year
    • How will CPP exemption be handled?
    • Are any taxable benefits or deductions affected?
  • Distribute new payroll cut-off schedule to HR, timekeepers, managers & supervisors and union if necessary
  • Carry forward balances
    • vacation accruals
    • banked overtime
    • unused sick days (if carry-forward allowed)
    • outstanding loans payable
    • garnishment balances
  • Update TD1 basic annual exemption
  • Remind employees to file new TD1 for additional tax credits
  • Remind commission employees to file new TD1X
  • Communicate new year CPP & EI statutory deductions rates and maximums

This article is an excerpt from Dialogue Magazine, which is received by members of the Canadian Payroll Association.

Statutory Holidays:
January
Jan 1: New Year's Day, national stat
February
Feb 18: Family Day, stat in  BC, AB, SK, ON, NB, NS
March
No statutory holidays this month.
Employer Health Tax Effective Jan 1

The employer health tax is an annual tax on B.C. remuneration paid to employees and former employees in a calendar year beginning on January 1, 2019.

Employers with B.C. remuneration:

Of $500,000 or less don't pay employer health tax

 

Between $500,000.01 and $1,500,000 (notch rate amount) pay the reduced tax amount as calculated:

2.925% x (B.C. remuneration - $500,000)


 

Greater than $1,500,000 pay the tax on their total B.C. remuneration as calculated:

1.95% x total B.C. Remuneration.

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