Chapter 2: Getting Started

Transcription

1 Chapter 2: Getting Started CHAPTER 2: GETTING STARTED... 1 CANADIAN TAX OVERVIEW... 1 SETTING UP GROUP RECORDS... 1 Group Record Control Fields... 2 Wage Accumulators... 3 Optional Use of Taxable Accumulators... 4 Tax Deduction Calculations... 6 Taxable Override Indicator (CTXO) SETTING UP INDIVIDUAL RECORDS Individual Participation Switches Wage Accumulation Category Participation Switches (ES Fields) Taxable Accumulation Participation Switches (TS01 -- TS15) CD Category Participation Switches (DS Fields) Individual-Level Earnings Accumulation Fields (TY01-TY15) Language Selection Switch (CW and CU Fields) CD Calculation Fields for Taxes Individual Accumulation Fields Canadian Tax Overview The Genesys system applications were designed to enable maximum flexibility in tax calculations and reporting. In order to take advantage of that flexibility, it is necessary to have an understanding of what controls are available and what data needs to be established on the master file. Chapter Two describes the tax-related information required when you set up a group or individual record Setting Up Group Records The group record consists of the following information: The tax-related group control fields. The wage accumulators. The accumulator switches that determine which earnings are to be included in the wage accumulator fields. The accumulator limit code and limit field. Taxable accumulators for your own use. Genesys Canadian Tax Manual Chapter 2: Getting Started 1

2 CD fields (tax deduction) to be used for the deduction fields. The following information must be entered for a group record prior to processing taxes: Specify which group processes Canadian taxes. Establish the group s processing type (CTYP). A value of 1 produces reports in English; a value of 2 produces reports in French. Define a group of wage accumulator categories to calculate earnings. Define a group of CD categories to calculate taxes or other deductions. Use accumulator switches to determine which earnings are to be included in each of the wage accumulators. Use the (optional) accumulators for your own purposes. Define accumulation limits and limit codes. Define the optional use fields (pointers for EI Subsystem processing needs). Group Record Control Fields The following table lists the group record control fields that must be set up in order to process taxes. Group Record Control Fields Field CSSC CSTX CTYP CPNO CPPD CTXO CRPP CRTE CE01-CEnn CD01-CDnn CN06 CN21 Description The Group s Social Insurance Number. A separate group must be identified for each Social Insurance Number. Company EI Reporting Number. The reporting number is used on T4, T4A and the EI Record of Employment (ROE) forms. Indicates tax processing and language type. A value of 1 in this field produces reports in English; a value of 2 produces reports in French, for Canadian tax calculations. Number of pay periods per year. Used in annualizing wages for tax calculations and for deannualizing exemption amount CPP/QPP. Value is usually 12, 24, 26 or 52. Check date entered on the 60 Control Transaction. Th date is used in conjunction with the tax calculation module (CANTAX) to determine the appropriate tax calculations. Refer to Chapter Seven for detailed information on the CANTAX module. Taxable wage override indicator. A value of 0 in this field indicates to use the normal method to determine Federal taxable wages. A value of 1 indicates Pension Group. Use annualization or Pension Fund Method to determine Federal taxable wages. Registered Pension Plan Method. Registered Pension Plan is system-generated as CD02. The value in CRPP determines which calculation method is to be used. Value: 0 or A = Indicates that a type/limit code will be used for CD02, designated by the user. 1-8 or B-I = Indicates one of the eight calculation methods provided for Registered Pension Plans. Refer to Chapter Three for detailed descriptions of these calculation methods. The same CANTAX routine is used for corresponding numeric and alphabetic characters. The numeric characters represent the defined benefit plan type of registered pension plan, whereas the alphabetic characters represent the money purchase plan type. Rate of company contribution to Unemployment Insurance Commission. Value: Eight-digit numeric (XXXX.XXXX); default value is 1.4% Calculates earning and defined the taxable wage base for withholdings. Defines deduction categories that calculate and withhold taxes. Total hours for EI deduction calculation. "Transferred from" master file key, and percentages and dates from 06 subcode on adjustments. 2 Chapter 2: Getting Started Genesys Canadian Tax Manual

3 Wage Accumulators Before taxes can be calculated, the system must know which earnings are taxable. For example, for a Payroll application this would be earnings or wages; for a Defined Contribution application it could be funds withdrawn. This allows applicable earnings to be combined to create a base for calculating taxes or other deductions. Gross pay alone is not adequate, since some types of earnings are considered tax -exempt or are calculated differently, depending on the individual and the province of employment or residence. For example, the calculation of company car benefits varies from province to province. The Genesys applications maintain fifteen wage accumulation categories; applicable earnings can be combined to create a base for calculating taxes or other deductions. Each wage accumulator calculation can be added to any or all of the 15 accumulation categories. This allows applicable earnings to be combined to create a base for calculating taxes or other deductions. The following wage accumulator categories are defined according to the tax they are subject to: Canadian/Quebec Pension Plan earnings (CPP/QPP) Federal Income Provincial Income (used for Quebec only) Commission earnings Taxable Benefits EI earnings Lump Sum Payments Quebec Health Insurance Premium Wages (QHIP) Canadian Registered Pension Plan (CRPP) Quebec Parental Insurance Plan (QPIP) These ten categories are referred to as taxable Wage Accumulators. Accumulators 6 and (CE06 and CD12-15) are optional, and can be used for user-defined purposes, such as hours worked for calculation of EI taxes. The following table lists these accumulators, their annual limits, limit codes, and the applicable wage accumulator field for each accumulator. The system also maintains a record of taxable earnings and taxes withheld in accordance with federal and state laws. Both T-4 and T4A s described in Chapter 5 and the EI Record of Employment (ROE) form described in Chapter 6 can be prepared for all tax jurisdictions. Taxable Wage Accumulators Wage Accumulator Accumulator Name 1 Canadian/Queb ec Pension Plan d(cpp/qpp) 2 Federal Income** 3 Provincial Income (used for Quebec only) 4 Commission Earnings** 5 Taxable Benefits Annual Limit (CL Field) System generated to current annual limit. Limit Code (CT Field) Applicable Earnings Include 1 Normally all earnings. None 0 Normally all earnings. None 0 Normally all earnings None 0 Commission earnings None 0 Commission earnings. Participation Y Y Y N N Genesys Canadian Tax Manual Chapter 2: Getting Started 3

4 6 Taxable #06 Userspecified 7 EI Earnings Systemgenerated to different annual limit 8 Lump Sum Payments 9 Quebec Health Insurance Premium Wages 10 Registered Pension Plan 0, 1, 2, 3 or 4 All wage accumulator amounts will default to accumulate unless otherwise specified. 4 Normally all earnings. None 0 Pension fund payments. None 0 Normally all earnings. None 0 Normally all earnings. N Y N Y Y 11 Quebec Parental Insurance plan System generated to current annual limit Taxable #nn Userspecified 0 Normally all earnings. 0,1,2,3, or 4 All wage accumulator amounts will default to accumulate unless otherwise specified. Y N ** If TS04 (individual participation switch 4) is not equal to 2, commission is added to Federal income, and to Quebec income. If TS04 is equal to 2, commission is not added to Federal and Provincial income. Commission Earnings Setup When setting up a Commission Earnings, it should not be set up to accumulate into WS02 (Federal wages) or WS03 (Provincial income for Quebec). It should be set up to accumulate into WS04 (Commission Earnings). Then, when needed, the override switch TS04 can be used to either combine the wages or not. The default value for TS04 = 0. If the TS04 is equal to zeroes, the WS04 will be combined with WS02 and WS03 prior to calculating the deduction 04 Federal tax and deduction 05 Provincial tax. If the TS04 is equal to two, the WS04 will not be combined with WS02 and WS03 and the tax for Deductions 04 and 05 will be based purely on what is in the TC02 (current Federal wages) and TC03 (Quebec income). It will not include commission earnings. Contribution to Government Pension, regular pension and EI are deducted from gross earnings prior to computation of Federal, Provincial and QHIP deductions. DCnn and DDnn fields cannot be used as wage accumulators for earnings. Optional Use of Taxable Accumulators Accumulators 6 and 11 through 15 may be used optionally; you can define the accumulation of amounts in accordance with the wage accumulator switches and the participation switches. For each earnings accumulator, the group record contains a limit code (CT01-CT15) and a year-to date limit field (CL01-CL15). Limit codes CT01-CT05 and CT07 CT10 are system-generated, as are year-to-date limit amount fields CL01-CL05 and CL07-CL10. 4 Chapter 2: Getting Started Genesys Canadian Tax Manual

5 For each optional accumulator, the group record contains a limit code (CT, 11-15) and a year-to-date limit field (CL06, 11-15). IF CT06 and CT11 through CT15 are non-blank, (indicating optional use), the internal annual limit formerly associated with that accumulator no longer exists. User-defined accumulators and certain system-defined taxable accumulators are controlled by the group CL (limit amount) and CT (limit code) fields. These fields are printed on the first page of the Company Status Report. CT Fields The CT fields provide a method to override the system-generated limit for optional accumulators 6 and 11 through 15. If any CT field value is 1 (indicating optional use), you must also provide an appropriate year-todate limit in the corresponding CL field. CT-1-CT05, CT07, and CT10 are system-generated limit codes for wage accumulators 1, 2, 3, 4, 5, 7, and 10. They are system-generated as spaces. CT06 and CT11-CT15 are optional limit cods for wage accumulators 6, 11, 12, 13, 14, and 15. The valid values for the CT limit code fields are as follows: Value blank Description System-designated use of accumulator category and program-supplied annual limit. 0 Optional use of accumulator category, with no annual limit. 1 Optional use of accumulator category, with a specified annual limit to the accumulation/ The limit value is coded in the corresponding CL field. 2 Operates the same as limit code 1, however the annual limit is pre-defined as being the cutoff with annual Government pension wage limit. 3 Optional use of accumulator category. Accumulate units, not dollars. 4 Uses EI tables to determine minimum and maximum earnings, depending on the province of employment (PREM) and the number of pay periods (CPN0). When gross earnings are greater than the maximum, use maximum earnings to add to the taxable. CL Fields The CL fields provide the limits for taxable earnings, and should only be use width limit code 1. The format for the CL fields is $$$$$$.. Example Using Optional Accumulator for Quebec Company Car Taxable Benefit The Province of Quebec taxes a larger portion of Company Car Benefits the Federal Government of Canada. For companies that have employees in Quebec, it will be necessary to differentiate between year-to-date taxable benefits for Quebec and for Federal reporting. This is for the purpose of year-end reporting on the T4 form the federal government and Releve 1 forms for Quebec employees. To facilitate this, use the wage accumulation switch value 2 for the benefit taxable accumulator 5. The value of 2 will only function for the benefit taxable accumulator. The value of 2 stipulates that when the group field CTYP =1 or 2 and an individual s province of employment in Quebec, the wage amount will be accumulated in a separate field (T021) in addition to being added to the taxable benefit accumulator. At year-end, the system will then differentiate between the amount of Company Car Benefit taxable for the Quebec Provincial tax from the total amount of taxable benefits for the Federal Government of Canada. The following example illustrates how the Company Car Benefit wage accumulator category and the additional Company Car Benefit for Quebec individuals can be set up. Wage Accumulation Switches Genesys Canadian Tax Manual Chapter 2: Getting Started 5

6 Wage Category Fed. Income Prov. Income Benefit Company Car 1 (Fed) Company Car 2 (Quebec) Note: When you turn on the accumulation switch indicators for Federal income, Provincial income and taxable for the first category, you establish the earning to be accumulated as a Federal and Provincial taxable benefit. The second wage accumulator category is set up to accumulate the additional provincial taxable benefit amount. It will be accumulated into accumulator category 5 as well as into a separate field (T021) on the individual s record specifically for Company Car Benefits. CTYP Group language 0 American 1 Can print English 2 Can print French Tax Deduction Calculations Most deductions are voluntary; taxes are generally mandatory. Deductions 1 through 6 are reserved for automatic calculation of the Canadian and Quebec pension Plan, Registered Pension Plan, EI contributions, Federal Income Tax, Provincial Income Tax (Quebec only), and the Quebec Health Insurance Premium (QHIP). Additional deductions are allowed for any group as specified at the time of system generation. These deductions are defined by using type/limit codes. The group record for each deduction in the CD field contains an eight-character label or heading, the type/limit code for calculation, and six values for the deduction schedule. Refer to Chapter 7 for detailed descriptions of the CD fields. Deductions are designated by means of the group record fields (CD01-CDnn). Deductions are processed in the order specified by the deduction priority. You may not necessarily want to process all deductions in order. For example, using the deduction priority provides you with the flexibility to take added registered pension deductions before the calculation of Federal Tax is provided. This allows all registered pension deductions to be taken into account when calculating Federal tax. In order for a deduction to be taken the following items need to be addressed: The deduction must be scheduled The individual must participate in the deduction. The amount of the deduction must be within any limit specified by the limit code. There must be enough net pay for the amount to be taken. A deduction schedule is defined as a group of switches indicating which deductions apply to a pay period. Use the following values to schedule deductions: Value Description 0 Do not take the deduction. This is the default for CD07-CDnn. 1 Take the deduction. If there are insufficient earnings, print Deduction Not Taken Report. 2 Take the deduction. If there are insufficient earnings, print Deduction Not Taken Report. 3 Calculate deduction, but do not take or print. Current and YTD fields are not updated. The first six CD fields for any Canadian group record are system-defined as: Value Description Type/Limit CD01 Canadian/Quebec Pension Plan (CPP/QPP) S6 CD02 Registered Pension Plan (CRPP) M1 or 00, ( based on value of CRPP) CD03 Employment Insurance Contribution (EI) S6 CD04 Federal Income Tax S6 6 Chapter 2: Getting Started Genesys Canadian Tax Manual

7 CD05 Provincial Income Tax S6 CD06 Quebec Health Insurance Plan (QHIP) (company paid benefit) Note: Deduction 1 (CD01) must be scheduled before any other statutory deduction. CD01 CD01 is system-defined as Canadian Pension Plan for all provinces except Quebec, for which it is Quebec Pension Plan. The calculation method is the same for both although they are reported separately. It is systemgenerated with a type/limit code of S6. The CPP/QPP requires the system to perform two calculations, and the lesser amount is used as the tax amount. For the first calculation, the CPP/QPP deduction total year-to-date (YD01) is subtracted from the individual s annual CPP/QPP tax limit (DA01). For the second calculation, the individual s annual exemption amount is divided by the number of pay periods per year (CPN)). The dividend is then subtracted from the individual s current taxable wages (WS01). The difference is multiplied by the tax rate (DNO1). The results of these two calculations are compared, and the lesser of the two amounts is deducted as the current CPP/QPP amount. The CPP/QPP deduction amount is prorated in the year the individual becomes age 18 or reaches the age of 70. CD02 CD02 is system-defined as Company Registered Pension Plan. Although a registered pension plan is not a tax, it has priority and therefore is deducted prior to other taxes. The method of calculation and type/limit code are determined by the value of CRPP. If the value of CRPP is 0 or A, then any valid type/limit code may be used to calculate the CD amount. FI the value of CRPP is 1-8 or B-I, the system generates the type/limit code of M1. The M code, unlike other type codes, does not actually define the calculation to be performed. The M type code directs the system to look at the value of CRPP. CD02 uses the current amount and year-to-date amount of taxable accumulator 10 (WS10) as the base for calculation. If it s a money purchase plan type, there is a tax deductible limit. The defined benefit plan type has no deductible limit, that is, 100% of all contributions are tax deductible. CD03 CD03 is system-defined as Employment Insurance Contribution (EI). It is generated with a type/limit code of S6, identifying it as a tax calculation. An individual remunerated for the time worked must satisfy one of two possible criteria to have an individual's wages insurable by UIC. The individual must work a minimum number of hours per pay period or earn a minimum dollar amount for the period. These minimums are established by the Government and if either criteria is met, the individual is deemed insurable. The monetary base that is interrogated is taxable accumulator 7 (WS07). If it exceeds the specified maximum, the maximum dollar value is used. To accommodate the minimum hours requirement, the CN06 field in the group record is used to reference an individual level field containing total hours. Master File Considerations An individual remunerated for time worked must satisfy one of two possible criteria to have their wages insurable for Unemployment Compensation Insurance. The individual must work a minimum number of hours/pay period or earn a minimum amount/pay period. To accommodate the minimum hour requirement, the CN06 field in the group header record is used to reference an individual level field containing total hours. This field will be interrogated to determine whether or not an individual passes the minimum pay period hours B1 Genesys Canadian Tax Manual Chapter 2: Getting Started 7

8 requirement. For both hourly and exception hourly individuals (SHCD = H or E), if the total amount of hours worked in the pay period is less than the minimum required, the EI deduction will not be taken unless the minimum dollar earnings amount is achieved. If the individual works over either minimum, the EI deduction will be calculated. For salaried individuals (SHCD = S), if the field pointed to by CN06 contains a value of zero, NORM will then be interrogated to establish the number of hours worked for EI purposes. If the field pointed to by CN06 is unequal to zero, NORM will be interrogated. Because the earnings categories representing actual hours worked vary from group to group, you are responsible for establishing the accumulation of hours. The following are suggestions for setting up these accumulations: An unused optional earnings accumulator can be used to accumulate units (CT field = 3). Set up a company constant to reference the current working storage field of this accumulator (WS). An asterisk reference to the company constant is then loaded into the field in the individual records pointed to by CN06. (These last two procedures must be set up because the working storage fields are not accessed directly by the CN pointers). Example: Assume taxable accumulator 12 is set up to accumulate units (CT12=3) and the 12 th taxable switch is turned on ( 0 ) in the appropriate earnings categories. The rest of the fields might be set up as follows: Date Element CM07 Value EB01 *07 CN06 WS12 EB01 A series of Own Codes can be used to accumulate the pertinent current house in an unused computational field. The condition codes should be a value of 0 and the frequency codes a 2 to ensure that the accumulation is performed on all individual records, after operation code on M (move). This will ensure that any totals from previous records will be overlaid. The receiving field of the Own Codes should be an unused computational field, such as and EB or DB field. CN06 points to the receiving field. Example: Data Element CN06 Value EB01 CO01 M OH01 EB01 02 CO02 A OH02 EB01 02 CO03 A OH03 EB01 02 If the minimum hours requirement is not satisfied, the current EI taxable dollars field (WS07) will be interrogated. If this field is greater than the minimum insurable dollar amount for the pay period, the EI tax deduction will be calculated. Note: If you are using the EI Subsystem, you should also use the CN21 field. Refer to Chapter 7 for a detailed description of the CN21 field. Input Considerations The first record to cause either minimum requirement to be exceeded determines which payment(s) the deduction is taken on. A running accumulation of current earnings subject to UIC will be maintained internally for all pay producing transactions. This includes all 56, 80, 81, 82, 85, 90, and 92 transactions. Advanced vacation earnings generated from 88 transactions are also included with these other payments, but not the cycle that the 88 is submitted. This is explained later in the Vacation Processing Section. It is this running accumulation which is checked against the UIC wage minimum and maximum limits, rather than the earnings from each record being checked individually against the limits. This running accumulation will include 8 Chapter 2: Getting Started Genesys Canadian Tax Manual

9 amounts which are below the UIC wage minimum, but the accumulation will be limited to the UIC wage maximum. Refer to Chapter 4 for the current UIC wage limits. Once this running accumulation exceeds the UIC wage minimum, the record being processed will have the UIC taxable updated by the total running accumulation thus far. The UIC deduction for this record will be based on the total current amount posted to the UIC taxable. If the maximum had not yet been reached, the current earnings from the next pay producing record will be compared to the result by subtracting the preceding running accumulation from the UIC pay period maximum; whichever amount is lesser will be posted since the minimum had previously been exceeded. Again the UIC deduction is based on the current amount posted to the UIC taxable. This process continues until the running accumulation reaches the pay period maximum. Once the maximum has been reached, any subsequent pay producing transactions will not update the UIC taxable and consequently no UIC deduction will be withheld. The current UIC taxable amounts from each pay producing records are combined and passed to the UIC Master Database as one entry. For Salaried Individuals If hours (such as overtime) are entered on the time card or job ticket to an earnings category which adds hours to the total hours field (pointed to by CN06), it may be necessary to enter the regular hours on the time card as well. This is to ensure that the individual's total hours exceed the pay period minimum. NORM will only be interrogated if the field pointed to by CN06 is equal to zero. CD04 CD04 is system-defined as Federal Income Tax, with a type/limit code of S6. For all provinces except Quebec, the Federal tax rate includes a percentage for the Provincial tax. Quebec calculates and remits its Provincial tax separately. Both Federal and Provincial Governments use a graduated tax table. Each individual is taxed at the rate determined both by the tax tables for province of employment and by the rate established by the individual's personal claim for exemption. The taxes are calculated according to Option 1 of the MC Bulletin, using WS02 plus WS04 as the gross remuneration for pay period. If a lump sum payment is made to an individual from a pension plan, the system uses WS08 as the base of calculation. CD05 CD05 is system-defined as the Provincial Income Tax calculation for Quebec, with a type/limit code of S6. The tax is calculated in accordance with the Guide to Deductions at Source and Employer Contributions. The calculation uses a graduated rate table and WS03 plus WS04 as the base. The current Provincial Income tax deduction amount and the year-to-date Provincial amounts are printed on check stubs, payroll registers, and deduction registers. The Provincial Income Taxes (YD03) and wage accumulations (TY03) are used when calculating the T4s and T4A, and are also printed on the Provincial Extract Tax Report. CD06 CD06 is the Quebec Health Insurance Plan (QHIP), with a type/limit code of B1. Quebec Health Insurance is no longer a required employee deduction. However, CD06 is system-defined for calculation of the employer's contribution to the QHIP. The current Medicare rate (DN06) is used in calculation with the current value as WS09 and the amount calculated is stored in the individual's record (DD06). Own codes may be used to store annual totals. Genesys Canadian Tax Manual Chapter 2: Getting Started 9

10 Taxable Override Indicator (CTXO) The data element CTXO provides the option to override the normal method of determining actual federal taxable wages with the annualization of Pension Fund Payment method. The formulas that are used are documented in the MC Bulletin. The valid values for CTXO are as follows: Value Description 0 Use normal method to determine actual Federal taxable wages. 1 Use the annualization or pension fund method to determine actual Federal taxable wages. Note: If CTXO=1, the annualization or pension fund formula will be used to determine Federal taxable wages for pay-producing transactions. Setting Up Individual Records The individual record consists of the following information: Participation switches for an individual's taxable wage bases. An individual's taxes when wages have been earned in more than one province. The tax calculation fields to supply tax amount information. Accumulation fields where the system accumulates taxes. Whenever you set up an individual record, the following information must be defined before you can process taxes for an individual: Specify each individual record by setting up the participation switches for CE and CD categories. The programs of the edit and update phase apply changes, calculate CE and CD categories, and update the master file. This includes all of the tax processing for each individual record. The system accumulates the CE calculation amounts (taxable wage bases) in fifteen different accumulation categories. Switches in the group record determine which CE categories are to be included in each of the fifteen categories. Define certain accumulation categories as taxable wage bases. Each type of tax has a separate wage base accumulator. Therefore, each wage OT CE category can be taxed differently. The system calculates all CE categories (including negative earnings) before accumulating taxable wage bases. Individual Participation Switches There are three types of participation switches on the individual record that can have an effect on the individual's taxable wage bases, and on how taxes are calculated: The CE Category Participation Switches (ES fields) Taxable Accumulation Participation Switches (TS01-TSl5 fields) CD Category Participation Switches (DS fields) The following table describes the relationship between group and individual participation switches. Individual Level Participation Switches Individual Group CE Categories ES CE CD Categories DS CD Taxable Accumulators TS01 - TS15 Positions of CE fields. 0 = Yes 10 Chapter 2: Getting Started Genesys Canadian Tax Manual

11 1 =No 2-4 = Special Routines for DS Participation Wage Accumulation Category Participation Switches (ES Fields) Each Wage Accumulation category can be subject to any and all taxes through use of the taxable accumulator switches within the wage accumulation field on the group record. Each individual record has a participation switch for each wage accumulation category. If an earning category is not pertinent to an individual, you should turn off the individual's participation switch for that wage accumulation category. There is an ES field on the individual record for every wage accumulation field on the group record. The values for the ES fields are: Value Description 0 Individual does participate in the wage accumulation category (default). 1 Individual does not participate in this category. Values 2-9 are special values for ES02 that indicate calculation routines for overtime earnings. Taxable Accumulation Participation Switches (TS01 -- TS15) Some individuals may be exempt from certain taxes, therefore it is necessary to turn off the tax from which the individual is exempt. The individual record fields TS01 through TSl5, called participation switches, perform this function. The individual record fields (TS01 through TS15) are switches that correspond to the fifteen taxable accumulators in the group record wage accumulation fields. For an individual's earnings to be added to an earnings accumulator, it requires both the ES and TS switches to be set to 'O'. If an individual is exempt from a particular tax category, you can prevent the taxable wages from accumulating. This will ensure that the various tax reports will reflect the proper wages as well as the taxes withheld. At the group level, each wage accumulation category can be specified whether to add or not to add a particular taxable accumulator. At the individual level, the choice is limited to either all of the wage accumulation fields specified at the group level are to be added, or none of the wage accumulation amounts are to be added to a particular accumulator. The values for the TS fields are: Value Description 0 Yes, accumulate this taxable base. 1 No, do not accumulate this taxable base. CD Category Participation Switches (DS Fields) The CD participation switch fields (DS fields) are used to indicate whether or not an individual is participating in a particular deduction. There is a DS field on the individual record for every CD field on the group record: i.e., DS01-DS96 for CD01-CD96. In addition to the usual CD participation switch (DS field) values of 0 and 1, the value of 4 is allowed in conjunction with the S- or L-type code. The values of 2 or 3 are allowed in conjunction with CD limit code 6. The DS field of an S6 or L6 CD category can indicate the following: Genesys Canadian Tax Manual Chapter 2: Getting Started 11

12 Value Blank or 0 Meaning Participation. Perform any tax routine indicated by the tax jurisdiction code in the individual's record. Add any additional amounts indicated by the individual to the computed tax amount. Accumulate wages for this jurisdiction. 1 Non-Participation. Do not perform any tax calculation; do not withhold any additional amounts, and do not accumulate any wages for this CD category. 2 Same as 0, but calculate the additional amount to be withheld by multiplying current taxable wages by the percentage indicated in the individual record. 3 Same as 0, but subtract the dollar amount indicated in the individual record from the computed tax. 4 Non-participation. Do not perform any tax calculation, and do not withhold any additional amounts. However, accumulate the taxable wages in the individual record. Individual-Level Earnings Accumulation Fields (TY01-TY15) Year-to-date totals for accumulators 1-5 are contained in individual fields TY01-TY15. Current accumulations are contained in working storage fields WS01-WS15. When all calculations have been completed, the current amounts from WS01-WS15 are stored in individual fields TC01-TC15 (primarily for use in reports). Separate totals of the current, quarter-to-date, year-to-date accumulations for each of the 15 accumulators are displayed on the Totals Recap Report each cycle. If a negative amount is present in a TQ or TY field, a warning message will be displayed on the Transaction Proof Report each cycle that the amount remains negative. A user-compile-time option is available to suppress the printing of this warning message. Refer to the GENESYS System Manual for detailed information on Compile-Time options. Special accumulation fields, maintained at the individual level, are used for certain deductions and credits when computing Federal and Quebec income taxes, or for reporting on year-end statements. You must load the factors for computing Federal income tax and Quebec income tax into the T0 fields listed in the following tables. T0 Fields Used for Federal Income Tax T0 Field Factor Description T022 HD Annual deductions for residing in a prescribed area as per line 19 of Form TD1. T024 Y Amount claimed for children and disabled or infirmed dependents. T062 F1 Annual deductions such as child care expenses, alimony payments, maintenance payments, etc. T064 F2 Alimony or Maintenance payments required to be withheld at source. T082 K3 Other Federal tax credits. T083 LCF/LCP Labor-sponsored Funds Tax Credit. T0 Fields Used for Quebec Income Tax T0 Field Factor Description T023 J Deductions claimed on line 17 of the TPD-1 form and other deductions authorized by Revenue Quebec. T063 Q Amount paid to purchase Class A shares in the Fonds de Solidarite des Travailluers du Quebec. The system will use the maximum shown in Chapter 3. T081 K1 Other non-refundable tax credits for the year authorized by Revenue Quebec. 12 Chapter 2: Getting Started Genesys Canadian Tax Manual

13 T084 J1 Other deductions authorized by Revenue Quebec. Note: T021 can be used for the Quebec Company Car Taxable Benefit. This is used for reporting on the Releve form. Language Selection Switch (CW and CU Fields) The data element ELTP is used to indicate either French or English headings for earnings or deductions. A value of 0 indicates alternate languages that are defined in the CW fields for printing individual deductions on statement headings and in the CU field for printing earnings on individual statement headings. A value of 1-9 is the default to the language specified in CTYP. Refer to Appendix A for the CTYP values. CD Calculation Fields for Taxes Each CD category has six associated fields on the individual record. The DS field has been described earlier. The DN, DA, DB, DC, and DD fields on the individual record are all used by the S6 or L6 type/limit codes in the calculation of taxes. For each deduction, the individual record contains the fields described in the following table. Individual Record Tax Calculation Fields Field DS DN DA DB DC DD Description* Participation switch O = yes 1 = no 2-4 = special routines for type/limit codes. Refer to Appendix A for additional information for DS fields. Constant fields*. Can be dollar and cents amount, a percentage or percentages, or an asterisk reference to a group constant. For a detailed description of the DN fields, refer to Appendix A. Used for limits, balances, or other fields as required. Used for limits, balances, or other fields as required. May be used to store additional information relative to deductions. May be used to store additional information relative to deductions. Note: Any of these fields that are not used by a deduction type/limit code are available to be used for other purposes. * Asterisk references to group constants can be used in any DN, DA, DB, DC, or DD field, except when the DA field is used as a balance field. Individual CD Record Fields The following table shows the individual record fields. CD Category Name Canadian/Quebec Pension Plan *Reg Pension Plan CD No. CD Constant DN01- DNnn 01 Current CPP / QPP Contrib. Rate 02 Percentage or Rate DA Field DA01- DAnn YTD Cutoff Limit Additional Amount or Percentage DB Field DB01-DBnn DC Field DC01-DCnn DD Field DD01-DDnn N/A N/A YTD CPP Previous Taxable Wages Limit or Exemptions N/A N/A Genesys Canadian Tax Manual Chapter 2: Getting Started 13

14 UIC Contribution 03 UIC Rate N/A N/A Current Co. UIC Contribution Federal Tax 04 N/A Additional Amount or Percentage Provincial Tax 05 N/A Additional Amount or Percentage Quebec Health Insurance Premium 06 Current Co. Medicare Rate Cut off for QHIP Exempt Amount Exempt Amount (Quebec Only) YTD Tax on Lump Sum Payments YTD Tax on Lump Sum Payments Total Vacation Earnings for UIC Subsystem N/A N/A N/A N/A Current Co. Contribution to QHIP * The values for Regular Pension Plan will vary depending upon the value in CRPP. Individual Accumulation Fields The Genesys applications maintain many accumulating balances for the purpose of calculating taxes and printing tax reports. The taxable wages are accumulated for each of the fifteen accumulator categories. These values include current taxable, quarter-to-date taxable and year-to-date taxable amounts. The taxes withheld values are maintained for the current period and year-to-date. If an individual transfers from one tax jurisdiction to another, the system maintains the taxable wages and tax withheld separately for UIC and T4 reporting purposes. Taxable Accumulation Fields Field WS01 - WS15 WS16 TC01 - TC15 TQ01 - TQ15 TY01 - TY15 Description Current taxable fields which correspond to taxables These are working storage fields available for use only in the Edit and Update Phase. These fields may be accessed by own codes, group constant fields, or CD calculations. Temporary net pay which is decremented by CD calculations. It is used to identify CD amounts not taken, where net pay is insufficient for a deduction amount. When all of the CE calculations have been completed, the current amounts from WS01-WS15 are stored in TC01-TC15. These fields are available for use in optional reports. Quarter-to-date accumulations for taxables These fields will be cleared to zero when NCQR is processed. Year-to-date totals for taxable accumulators These fields will be cleared to zero when NCYR is processed. T021 Wage Accumulator 5 (Taxable Benefits) for wage categories with an accumulator switch equal 2. Currently only for Quebec Company Car Benefit. The contents of T021 will be subtracted from TYO5 prior to printing TY05 in the Benefits box on the T4 form. T022 T023 T024 T062 T063 Annual deductions for residing in a prescribed area. Used for Federal Income Tax. Deductions claimed on line 17 of the TYPD-1 form and other deductions authorized by Revenue Quebec. Deduction for Ontario for the number of children and disabled or infirmed dependents. For British Columbia this field is the dollar amount of the non-refundable surtax credit of $50 for each dependent under age 19 The dollar value for the Fl factor, annual deduction authorized by the District taxation office (such as child care expenses, alimony payments, etc.) in the Federal formula. Amount paid to purchase Class A shares in the fonds des travailleurs du Quebec. The system will use the maximum shown in the Option 4 Formula in Chapter Four. 14 Chapter 2: Getting Started Genesys Canadian Tax Manual

15 T082 OD01 - ODnn YD01 - YDnn The dollar value for the K3 (other Federal tax credits authorized by the District Taxation Office) in the Federal formula for tax calculations. Current calculation amount for a CD category. This will be the amount of tax withheld on the current cycle. Year-to-date accumulation for each CD category. This will be the tax amount withheld year-todate for the individual's current tax jurisdictions. Genesys Canadian Tax Manual Chapter 2: Getting Started 15