Year-end

There are several important yearly payroll processes that need to be done in Umana. We call these the YEAR-END process.

• It's often a crazy time for payroll staff, while everyone else is off for the Christmas holidays.

1. Roll over time banks

• Rolling over time banks (vacation, sick days, overtime, etc.) is more an HR function rather than a payroll responsibility.

• Time banks roll over at the end of their reference year — which can vary for different banks, and can even vary from employee to another.

2. Validate employee Social Insurance numbers.

It is important that every employee has a valid SIN number in their file as this number is used on all tax documents (T4, R1, ROE, etc). The SIN is input on the employee's Person file under the Misc tab. See Side Menu > Employee > Person > Misc

3. Update employee TD1 info

TD1 Personal Tax Credit Forms from Revenue Canada, allow employees to declare additional tax credits and request addition tax deductions.

• Employees TD1 forms from past years should be reviewed annually, although Umana does not force you to do so.

Information from TD1 forms is entered in the Pay Info window in Umana. See Side Menu > Person > Pay info

• Umana does not keep history of values in this window, so you need to make changes just before the first pay run of the year

4. Prepare for the new taxation year

Tax rates change in Canada at the beginning of each calendar year. Each year you need to

1. Prepare your new year payroll calendar
2. Insure the new DEDSTAT tax parameters from Umana are installed.
3. Enter government-assigned rates particular to your company: (EI reduced rate, WSIB, WCB, CNESST.

It is important to understand points 2 and 3 above, and how they work together. The new tax rates (Dedstat) and the new employer rates (EI reduced rate,etc.) are used to calculate the first pay of the new year.

All 3 items must be in place BEFORE calculating the first pay of the new year. The first two items you can do in advance; the third item you must do at the last minute.

5. Prepare your new holiday calendar

This is done in the Schedule Patterns module: Left-menu-bar > Administration > Schedule.

See the Holiday Calendar for how to do it.

6. Prepare and send employee tax forms

• Each year, before the end of February, you need to prepare tax documents like T4, etc. You distribute printed forms to employees and transmit XML files to the government.

7. Send Remittance summaries and balances

There are typically other government summary documents to remit at the end of this period as well. For example:

• Workers Compensation Board (CNESST or WCB or WSIB),
• CARRA reports in Quebec
• Releve-1 sumary form in Quebec
• WSDRF (Workforce Skills Developement and Recognition fund) report and remittance in Quebec, etc...

Ideally, Year end checks and balances are made through out the year so that when tax time arrives most of the balancing work has already been done.

Reference sites

More info is available from a panoply of useful web sites.