Set up basic tax information for an employee

Tip: You must open a pay period to use this feature / functionality. Click the Pay Period menu and click the Enter button for the pay period you want to work with. The Payroll and Process menus become available.

An employee's basic tax setup can be completed on the Employee Profile page. From the Payroll menu, select Hire/Profile > Employee Profile. . This is usually done when first hiring an employee but may be edited if the employee's tax status changes.

Tasks

Set up basic tax information for an employee

1. Open the Employee Profile page. From the Payroll menu, select Hire/Profile > Employee Profile.
2. Select the employee from the Employee List.
3. Scroll down to the section that covers taxation.

4. Select the Province of Employment from the list.

   Normally, this is the place where the employee reports to work, not the place of residence. To learn more, see Federal Resources on the Dayforce Compliance Centre.

5. Accept the default Federal Tax Exemption, or select the Apply specific amount option and enter a different value.

   An employee must fill out a TD1 form if a value other than the basic amount is required.

6. Accept the default Provincial Tax Exemption, or perform one of the following actions:

   1. Click Apply specific amount and enter a different value.

   2. Click Not Applicable.

   An employee should fill out a TD1 (Provincial) form if a value other than the basic amount is entered.

7. Select the Tax Status from the list.

   Any exemptions or special situations may have to be assessed separately. Exemptions should be documented through the TD1, TD1 (Provincial), or the TD1-IN (exemptions for Status Indians).

   Note: If you choose Permanent Tax % from the list , you must also make an entry on the Statutory Deductions page. From the Payroll menu, select Regular Payment > Statutory Deductions.

8. Select the CPP/QPP Status from the list.

   The exemption is usually based on age. The employee must be 18 or older, but younger than 70. (The employee also has pensionable employment during the year and does not receive a CPP or QPP retirement or disability pension.) In Québec, refer to "Guide for Employers - Source Deductions and Contributions" available from ministere du Revenu du Quebec (http://www.revenu.gouv.qc.ca).

9. Select the EI Category from the list.

   Tip: The EI Premium Reduction Program allows employers to pay EI premiums at a reduced rate if their employees are covered by a short-term disability plan that meets the requirements set by Service Canada. For more information, see Reduced EI/QPIP rates.

10. Select the Provincial Payroll Tax Indicator from the list.

    Hospital and Medical Care Premiums or Provincial Payroll Tax amounts may or may not be applicable for your payroll. Contact your provincial government agency for more information.

11. If applicable, select a provincial safety plan from the Provincial Safety Plan Type list.

    Currently, only Nova Scotia and Quebec are approved for direct remittances. You must also select the specific plan from the list. Up to 10 different plans can be set up, depending on your requirements. To set up or change a plan, contact your Service Delivery Team.

12. Click Save.

    Any further changes or additions to the employee's tax profile must be completed on the Statutory Deductions page. From the Payroll menu, select Regular Payment > Statutory Deductions.