Payroll Fundamentals question with answers
RQ and CRA define a car allowance as reasonable if: - -- The allowance is based solely on business
kilometres driven in a calendar year
- the amount provided is based on the following government-prescribed reasonable guidelines
- $0.58 per km for the first 5,000 business km's in the year ($0,62 in the Yukon, NWT & Nunavut)
- $0.51 thereafter ($0.56 for YK, NWT, NT)
- the employer does not reimburse the employee for expenses related to the same use of the vehicle
-Personal Driving includes: - -- vacation travel
- driving to conduct personal business
- travel between home and work, even if the employer insists the employee drive the vehicle home
-Business driving includes: - -- driving to existing and prospective clients, points of call, and other office
locations of the employer
- when an employee travels directly from home to a point of call, which is not the employer's place of
business where the employee regularly reports for work
- when the employees travels home directly from a point of call
-Availability (automobiles) - -The number of thirty-day periods that the automobile is available to the
employee for the current taxation year. The employee has access to or control over the vehicle.
-Automobile - -A motor vehicle that is designed or adapted to primarily carry individuals on highways
and streets, and has seating capacity of not more than the driver and eight passengers
-If a gift or award is given to an employee in cash - -The amount is considered pensionable, insurable
and taxable to the employee, subject to all statutory deductions
-Overtime meal allowance is considered non-taxable if (RQ): - -- overtime is done at the employer's
request and is expected to last for at least two consecutive hours
- overtime is done rarely or on an occasional basis
- the meal expenses are reimbursed upon presentation of receipts
- the meal expenses reimbursed or the value of the meal provided is reasonable
-The four categories of employment income - -- Earnings
- Allowances
- Benefits
- Taxable expense reimbursement
-Earnings - -Dollar amounts the employer pays an employee for the work they perform
-Types of earnings - -- a salary
- a rate for each hour worked
- a rate per piece of goods produced or picked
- a disability payment for time off work due to illness
- a payment for vacation time
, - a premium payment for overtime hours worked
- a premium payment for hours worked on shift
-Allowances - -Additional dollar amounts paid to employees for the use, or anticipated use, of their
personal property for business purposes
-Benefits - -Dollar values attributed to something the employer has either provided to an employee or
paid for on an employee's behalf
-Expense Reimbursements - -Dollar amounts paid to employees to cover expenses that they incur while
performing their job.
-Regular payments - -Have an established frequency, such as weekly-paid salary or wages
-Non-regular payments - -payments that do not occur each pay period, for example, a bonus or a
retroactive adjustment
-Salary - -A fixed amount of money paid to an employee for each pay period.
-Salary per pay period - -Annual salary / number of pay periods per year
-Wages - -Earnings which are based on the amount of time worked, usually at a rate per hour or per day
-Regular earnings - -Hourly rate x pay period regular hours worked
-Piecework - -A rate of pay earned per unit of production, regardless of the length of time taken
-Self-Insured Disability - -Employers often offer disability coverage that provides their employees with
income in the event of absence due to illness or injury
-Sick Pay - -An amount paid to an employee who is absent from work due to illness or injury. Paid sick
leave is only legislated in two provinces, PEI and Quebec. With the other provinces paid sick leave is up
to the employer.
-Formal Plans - -A plan structured to balance both the needs of the employee and the employer. Formal
plans will outline provisions for the amount of sick leave, and whether the leave can be carried over to a
following year.
-Informal plans - -Informal, unwritten plans exist in organizations that have no formal policy for sick
leave.
-Wage-loss replacement plans (WLRP) - -An agreement between an employer and employees, or
between an employer and a group or association of employees, under which the employees are
compensated with payment on a periodic basis or the loss of employment income as a result of sickness,
disability, maternity, or injury.
-Short-term disability plans - -Plans that provide pay to an employee when he or she is unable to work
because of a non-work-related illness or injury
RQ and CRA define a car allowance as reasonable if: - -- The allowance is based solely on business
kilometres driven in a calendar year
- the amount provided is based on the following government-prescribed reasonable guidelines
- $0.58 per km for the first 5,000 business km's in the year ($0,62 in the Yukon, NWT & Nunavut)
- $0.51 thereafter ($0.56 for YK, NWT, NT)
- the employer does not reimburse the employee for expenses related to the same use of the vehicle
-Personal Driving includes: - -- vacation travel
- driving to conduct personal business
- travel between home and work, even if the employer insists the employee drive the vehicle home
-Business driving includes: - -- driving to existing and prospective clients, points of call, and other office
locations of the employer
- when an employee travels directly from home to a point of call, which is not the employer's place of
business where the employee regularly reports for work
- when the employees travels home directly from a point of call
-Availability (automobiles) - -The number of thirty-day periods that the automobile is available to the
employee for the current taxation year. The employee has access to or control over the vehicle.
-Automobile - -A motor vehicle that is designed or adapted to primarily carry individuals on highways
and streets, and has seating capacity of not more than the driver and eight passengers
-If a gift or award is given to an employee in cash - -The amount is considered pensionable, insurable
and taxable to the employee, subject to all statutory deductions
-Overtime meal allowance is considered non-taxable if (RQ): - -- overtime is done at the employer's
request and is expected to last for at least two consecutive hours
- overtime is done rarely or on an occasional basis
- the meal expenses are reimbursed upon presentation of receipts
- the meal expenses reimbursed or the value of the meal provided is reasonable
-The four categories of employment income - -- Earnings
- Allowances
- Benefits
- Taxable expense reimbursement
-Earnings - -Dollar amounts the employer pays an employee for the work they perform
-Types of earnings - -- a salary
- a rate for each hour worked
- a rate per piece of goods produced or picked
- a disability payment for time off work due to illness
- a payment for vacation time
, - a premium payment for overtime hours worked
- a premium payment for hours worked on shift
-Allowances - -Additional dollar amounts paid to employees for the use, or anticipated use, of their
personal property for business purposes
-Benefits - -Dollar values attributed to something the employer has either provided to an employee or
paid for on an employee's behalf
-Expense Reimbursements - -Dollar amounts paid to employees to cover expenses that they incur while
performing their job.
-Regular payments - -Have an established frequency, such as weekly-paid salary or wages
-Non-regular payments - -payments that do not occur each pay period, for example, a bonus or a
retroactive adjustment
-Salary - -A fixed amount of money paid to an employee for each pay period.
-Salary per pay period - -Annual salary / number of pay periods per year
-Wages - -Earnings which are based on the amount of time worked, usually at a rate per hour or per day
-Regular earnings - -Hourly rate x pay period regular hours worked
-Piecework - -A rate of pay earned per unit of production, regardless of the length of time taken
-Self-Insured Disability - -Employers often offer disability coverage that provides their employees with
income in the event of absence due to illness or injury
-Sick Pay - -An amount paid to an employee who is absent from work due to illness or injury. Paid sick
leave is only legislated in two provinces, PEI and Quebec. With the other provinces paid sick leave is up
to the employer.
-Formal Plans - -A plan structured to balance both the needs of the employee and the employer. Formal
plans will outline provisions for the amount of sick leave, and whether the leave can be carried over to a
following year.
-Informal plans - -Informal, unwritten plans exist in organizations that have no formal policy for sick
leave.
-Wage-loss replacement plans (WLRP) - -An agreement between an employer and employees, or
between an employer and a group or association of employees, under which the employees are
compensated with payment on a periodic basis or the loss of employment income as a result of sickness,
disability, maternity, or injury.
-Short-term disability plans - -Plans that provide pay to an employee when he or she is unable to work
because of a non-work-related illness or injury
