CRA’s Payroll Deductions Calculator: A Powerful Online Tool
CRA’s website provides a great free calculator which can be used to estimate gross pay, deductions and net pay for your employees or yourself. This tool is very effective and a time saver when it comes to the manual payroll and is best suited for small businesses or individuals especially if you do not have access to third party software that calculates payroll for you. It makes the annual reporting quite simple - for example - preparing T4 slips and summary.
This is how you can make use of this tool. You must simply go to the website below and follow the steps:
Step 1 asks you to fill in the employer’s name, employees’ name, province, pay period frequency and the date on which the employee is paid. Step 2 asks you to fill in the relevant salary and non-statutory deductions information - gross income and vacation pay.
Then enter the remaining deduction information as required – EI, RRSP contributions. Step 3 asks you to fill in Federal TD1 Claim code based on employee - completed form. Provincial TD1 Claim code needs to be provided based in the similar fashion. Next it will ask you to select the options for EI and CPP. I am sharing the criterion of CPP and EI that needs to be used for calculation-
CPP – Maximum annual contributions or year-to-date amount.
EI – Maximum annual premium or year-to-date amount.
That is it, simply click on Calculate. Voilà….
A nice payroll deductions summary report including Net Salary, Federal and Provincial deductions, Tax, CPP, and EI deductions gets displayed. You can also print/save the report and modify any changes in the current calculation. One more interesting feature is to click on the Employer Remittance Summary so that you can see the details of Employer’s portion of EI and CPP.
There is a help feature on the left side of the calculator and it will give you additional information on claim codes, pay date, calculate only vacation pay, how to save results, next employee calculations and so on.
All in all, this is a great tool for all types of businesses who are looking for some quick training, methods and tools for their employees to help them build Canadian payroll fast and easy.