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What's New?

November 2001 - Welcome to the latest edition of The Payroll News. As always, please feel free to forward this newsletter to your friends and associates who are interested in keeping up with the latest changes in the Payroll industry. Or better yet, subscribe them for free using the Tell Someone About Us link.

Upcoming Events:

Listed here are recent changes in legislation on Federal and Provincial levels that may impact your payroll calculations. Please view the following list for changes that affect your region.

FEDERAL:

October 12, 2001 - Ensuring Economic Security and Fiscal Stability - Provincial and territorial finance ministers met in Vancouver on October 11 to discuss the challenge of ensuring economic security and fiscal stability in Canada. Finance ministers want to reassure Canadians that while the short-term economic outlook has become less certain, Canada's economic fundamentals are sound. Low interest rates, reduced taxes and sound fiscal management on the part of governments are providing a secure base to build economic recovery. (Full Story - 550 Words)

October 2, 2001 - CCRA issues Third-party Penalties Guidelines - The Information Circular 01-1 Third-Party Civil Penalties is now available on the CCRA website. This circular governs how the CCRA can take action against individuals who counsel others to file tax returns based on false or misleading information, or who turn a blind eye to false information provided by their clients for tax purposes. (Full Story - 270 Words)

Alberta:

September 28, 2001 - AHRE Minister Applauds Employment Growth - Alberta's Human Resources and Employment Minister Clint Dunford said "Strong employment growth is good news for Albertans, and Alberta Human Resources and Employment is responding with effective supports for people and workplaces,". This was in response to the 2000/01 annual report of Alberta Human Resources and Employment. (Full Story - 710 Words)

British Columbia:

September 28, 2001 - Government Seeks Improved WCB Responsiveness - The BC government is taking steps towards fixing problems at the Workers' Compensation Board. Its goal is to make the WCB more responsive to workers' and employers' needs. Skills Development and Labour Minister Graham Bruce said, "We are committed to making the changes needed to improve the board, cut its red tape and make it more user-friendly to both workers and employers,". Part of the new initiatives include two expert reviews which will report back in mid-January. Other measures include two new appointments to replace the current WCB panel of administrators. (Full Story - 372 Words)

Newfoundland and Labrador:

September 21, 2001 - Employment Insurance Discussed Between Ministers Responsible for the Status of Women - Federal, Provincial and Territorial Ministers Responsible for the Status of Women met today to conclude their 28th annual meeting. Issues associated with women's participation in the labour force and their working conditions were central to the discussion. Ministers, with the exception of Quebec, endorsed a collaborative project with their labour colleagues (CAALL) to gather statistical information and develop an inventory on access to employment benefits for non-standard workers, many of whom are women. Ministers also heard presentations from Manitoba on women's access to Employment Insurance. (Full Story - 495 Words)

Ontario:

October 17, 2001 - More Jobs to Result from Task Force on Economic Competitiveness - In an effort to strengthen Ontario's ability to bid for and win jobs globally, the Ontario Government has committed substantial resources and set up an economic task force to examine global job-related issues. "We've improved Ontario's competitiveness by lowering taxes, supporting research and development and eliminating 1,700 unnecessary regulations," said Bob Runciman, Minister of Economic Development and Trade. "But we have more to do...". The economic task force includes a team of blue-ribbon business leaders, all focused on creating more jobs in Ontario. (Full Story - 269 Words)

October 22, 2001 - Revised Ontario Budget that Affect Payroll Calculations - Income tax rate changes have been announced that will take effect on January 1, 2002. On October 1, 2001, several tax cuts go into effect for the year 2001 as announced by the Ontario government. (Full Story - 290 Words)

The latest release of GrandMaster Suite incorporates a number of changes that make it even easier to use the program and perform your payroll tasks. Some recent changes to the program include:

• You can now choose an Earning, Deduction or Accumulator from a list in the Group Sort Selection dialog box. After selecting a sort option that requires a "Sort Selection", you may access the list by placing the cursor in the "Sort Selection for…" field and pressing the <F8> key.
• The Name in Payroll option from the Employee menu has been enhanced to include the "Show only payroll ACTIVE employees" setting. This allows you the ability to select or de-select the "Show only payroll ACTIVE employees" option from within the Name in Payroll dialog box. This is helpful in such instances when you may have the need to search for information on an employee who is not active and would normally be hidden from view (if the "Show only payroll ACTIVE employees" setting was selected).
• The Employee Payroll Profile Report has been modified to include the selected sort category with each employee record. It also includes an enhancement to how the employee SIN is displayed and now shows the Sort Description in the total line.
• The Payroll Register Report has been changed to display or print the employee SIN as separate 3 digit segments instead of a string of nine digits. This enhancement makes the SIN easier to read in this report.

Stay tuned to CanPay's Product News page to receive the latest information about all GrandMaster products!

• • •

October 18, 2001 - Vancouver Training Seminars - Thank you to the Vancouver residents who expressed interest in our training seminars planned for November of 2001. Due to recent world events, we will not be holding the November seminars at this time. We are, however, planning for a Spring 2002 session in your area. Please watch your e-mail for further announcements and check our Training web page regularly for updates.

With year-end rapidly approaching, employers need to verify their CPP deductions for each of their employees. This can help employers to avoid costly penalties, and also make the year-process run as smoothly as possible.

Employer Responsibilities

As an employer, it is your responsibility to make the corresponding payroll deductions from each employee based on their pensionable earnings. Each employee's contribution must be matched with your own funds. Canada Pension Plan contributions must be deducted from an employee's pay if the employee is 18 or older but younger than 70. The employment must be pensionable, and the employee cannot be receiving a Canada Pension Plan retirement, or disability pension.

For the 2001 tax year, the contribution rate for both employees and employers is 4.3% of pensionable earnings. The maximum pensionable earnings have been set to $38,300. The basic exemption is set to $3,500. The maximum contribution for any employee is set to $1,496.40.

If an employee works for you for the full year, they are entitled to the entire $3,500 basic exemption. For employees who work less than a full year, the exemption is prorated to the time they worked. For example, if an employee is paid semi-monthly and works for half of the year (i.e. 12 pay periods), their exemption would be $1,750 (i.e. 50% of $3,500).

You must stop deducting Canada Pension Plan contributions when you reach the maximum employee contribution. If your employee has made CPP contributions through another employer and/or remitted CPP under another Business Number in the year, you must not include those contributions in your calculations.

Employer Penalties

Employers who do not comply with the rules face various penalties and interest charges. Under certain circumstances, the CCRA can apply a 10% or 20% penalty. Such circumstances include:

• If remittances are made after the due date;
• If the required amount of income tax, CPP contributions, or EI premiums are not deducted; or
• If these amounts are withheld from the employee but not remitted.
• If CPP or EI was not deducted, the employer has to pay the employee's share in addition to their share.

Employers also face a $25 per day fine (per slip or summary) for information returns not filed by the end of February of the following calendar year. These infractions carry a minimum penalty of $100 to a maximum of $2,500. This refers to the following information returns: T4, T4A, and T4F Supplementary slips and the related summaries.

For further information on this topic, please refer to the: T4001 "Payroll Deductions (Basic Information) 2000-2001" Guide. Click Here to view to guide online.