As another year closes and tax season approaches, it’s common to feel a hint of apprehension. You're not alone! Employers share the responsibility of calculating, withholding, and remitting income taxes to the Canadian government while ensuring employees receive their T4 forms by February's end.
From scrutinizing taxable benefits to reconciling records and generating T4s, payroll administrators face essential tasks to comply with CRA regulations and offer a seamless tax experience for employees.
We understand tax season can be daunting, even for seasoned professionals. Thankfully, Humi Payroll users can rely on a dedicated team of payroll product experts and robust software to navigate tax season with confidence!
Drawing on valuable insights from the previous tax seasons, our payroll team has compiled answers to your top questions. Let's make this year's filing a stress-free experience!
- What does it mean when I have a +/- on Humi’s PIER Analysis Report, and what should I do now?
Humi’s Pensionable and Insurable Earnings (PIER) Analysis Report is designed to help streamline T4 preparation and quickly identify potential discrepancies in Employee CPP, Employer CPP, Employee EI, and Employer EI.
You can easily see a discrepancy if there’s an amount other than zero in any of the “variance” fields.
A positive (+) discrepancy means there’s an over-remitted amount, or an “overage”.
A negative (-) discrepancy means there’s an under-remitted amount, or a “deficiency”.
If you see a discrepancy, determine if it is valid, by:
- Totalling the CPP and Employer CPP
- Totalling the EI and Employer EI
- Taking those amounts and cross referencing them with the Remittance Report to determine if you need to remit more
If you have over-remitted, the CRA will issue a credit for the over remittances. If you’ve determined that you need to make additional payments, you can view the process in our year-end guide.
- Why is there a PIER deficiency on Humi’s PIER Analysis Report?
Humi’s PIER Report helps bring to your attention any variances that may be flagged by the CRA, although it doesn’t mean that you’ve definitely over or under remitted.
These variances need to be explained to the CRA if they question it. Reasons for variances could include, but are not limited to:
- If an employee was on payroll, with 0 pay in a pay period
- If an employee turned 18 or 70 and started/stopped contributions
- If an employee was on leave but remained on as an active employee and active on payroll
- If you were granted an EI premium reduction, using a rate that is lower than the standard employer rate of 1.4 times the employees' EI premium
- If your company was implemented mid year.
Smaller variances aren't looked at closely by the CRA, so in the cases where you are seeing pennies, it's likely a rounding error and that isn't something you’ll be required to explain.
Humi’s PIER Report is designed to give you the tools you need to flag and determine the cause of the variance so you can decide on the best course of action to take. Due to compliance and liability reasons, we’re not able to advise on specific reasons for employee variances, but we highly recommend speaking to an accountant if you are new to reconciling a PIER Report. Humi’s PIER Report is not a replacement for the CRA’s PIER Report.
- How do I send my terminated employees T4s?
Once you’ve edited, reviewed, and finalized your T4 package in Humi, you’ll be able to send T4s to all employees via the email associated with their Humi profile. Terminated employees cannot log into their Humi profile anymore to edit their email, so it’s good practice to check the email on their Humi account is a personal email.
To update a terminated employee’s email address:
- Go to the “People” module on the left navigation pane.
- Under the "Directory" tab, click on the filter icon next to the "Status" column and select the "Terminated" checkbox.
- Follow the steps in this support article to update an employee’s email.
- What do I need to consider if I joined Humi part way through a calendar year?
We recommend that you follow up with your previous payroll provider to confirm they do not file T4s, as this will overstate actual earnings and will require reconciliation.
Review the company's Year-to-Date (YTD) records to ensure they include all payroll details from the 2023 periods prior to your switch to Humi. If you find any omissions, you can employ Humi's T4 Adjustment Tool to integrate the required YTD information.
Note: Your Humi PIER Report may flag your CPP and Employer CPP as a discrepancy since you’ve joined mid year, due to the CPP per pay period exemption which would not be captured when importing YTDs.
- My previous payroll provider filed 2023 T4s for the first part of the year, what do I do?
Kindly reach out to your former payroll provider to retract the submission. If not addressed, there's a potential for duplicative reporting of your employees' earnings.
- An employee has informed me that there is an error on their T4. How do I revise a T4 that’s been filed already?
If you've submitted your T619 file to the CRA and discovered an error on a T4, the CRA requires that you create and submit an Amended T4, and upload a new, updated T619 on the CRA's website.
Thankfully, you can create T4 amendments in Humi Payroll! Follow these instructions for creating T4 amendments.
- Why can’t I access or make changes in the Year End Adjustment tool?
Once you've produced or completed your T4 package, access to the Year End Adjustment tool will be restricted. To regain access to the Year End Adjustment tool, you must remove the T4 tax package. Be aware that deleting the tax package will result in the removal of any manual modifications made to the T4s within the T4 module.
- Does Humi automatically submit our T619 file to the CRA?
This year for the 2023 tax season, Humi will be enabling automatic T4 submissions. Follow these instructions for how to submit the T4s.
- Where can I obtain a copy of my T4 summary?
The T4 summary can be found within the T4 module beneath each individual employee's T4s. Additionally, it can be accessed when downloading the tax package.
- Am I required to send my employees a new TD1 form to fill in?
Employers must provide TD1 forms when hiring new employees. Subsequently, employees should update and submit revised TD1 forms if there are modifications to their tax deductions, place of residence and/or SIN number.
Want to learn more? We’ve got you covered.
For a comprehensive guide on how to navigate year-end, refer to our 2023 Year-End Guide, which includes a year-end checklist to help you stay on top of critical tax season tasks, and detailed instructions for:
- how to review and adjust records
- how to issue, edit, and file your T4s
- how to set-up for the next payroll year
If you have specific questions regarding the T4 module, our payroll support team will be happy to help! Simply submit a support ticket here.