Views:

The CRA sends out PIER reports when they believe there is an error in the amount of CPP or EI remitted for an employee after you send in the year end tax slips (T4s).  Here are a few things you can review to see if this truly might be the case or if CRA has made a mistake.

CPP Issues: Before assuming that the program has calculated incorrectly, have a look at these common things that can result in CRA questioning the calculation. 

  1. How old was the employee during the tax year?  Employees under 18 and over 70 are exempt from CPP.  The program calculates this based on Date of Birth and will automatically exempt them.  CPP will start/stop in the first pay in the month after they turn 18/70.
  2. Did the employee work for your company for the entire calendar year? Each person gets $3500 that is exempt from CPP deductions. This amount is divided up per pay period.  For example, a company that is bi weekly, their employees will have CPP calculated on their Gross Pensionable earnings less $134.61 for each pay period ($3500/26 pay periods).  If the employee did not work for you for the entire year they will not have gotten the full $3500 exemption at your place of employment. 
  3. Were any rules changed during the year? If you are using any rules in the system and they were subject to CPP for only part of the year then this would cause a discrepancy in what was remitted versus what should have been remitted.
  4. Was the Employee YTD or T4 edited? We can check your logs if you need us to, but if you have made any modifications during the year or at year end this could result inconsistencies. Fees will apply if you require assistance to check.
    1. We always recommend taking any screenshots before and after you make any changes just in case you need to refer back.
  5. Did you start part way through the year? Were YTD amounts entered correctly? You can review the first pay slip in the program to see what the YTD was when you first entered the amounts.  Take the YTD and subtract the current earnings and that is what you entered in YTD.
  6. Too many regular pay runs? CPP exemptions are calculated on each pay run and expect only that number of regular runs in a year.  For example, a Biweekly setting should only have 26 regular pay runs.  If you ran more than this the employee(s) may have been over-exempted.  To avoid this in the future, if you need to run more pay runs than your normal pay period consider using the Special run feature.

EI Issues: check these things. 

  1. Were any rules changed during the year?  If you are using any rules in the system and they were subject to CPP for only part of the year then this would cause a discrepancy in what was remitted versus what should have been remitted.
  2. Was the Employee YTD or T4 edited? We can check your logs if you need us to, but if you have made any modifications during the year or at year end this could result inconsistencies.  Fees will apply if you require assistance to check.
    1. We always recommend taking any screenshots before and after you make any changes just in case you need to refer back.
  3. Did you start part way through the year? Were YTD amounts entered correctly? You can review the first pay slip in the program to see what the YTD was when you first entered the amounts.  Take the YTD and subtract the current earnings and that is what you entered in YTD.

If you have reviewed these and still cannot find the issue feel free to contact us. Fees will apply if you require assistance to resolve.

If you do find the issue you can amend the T4s,if needed, and make any necessary payments to CRA.