Payroll Configuration examples
Sample Pay Code Reference
The following Pay Code examples are provided as a guideline for matching the Pay Codes to the new reporting options on the right hand side of the Pay Codes tab. Each Code presented is our recommended example of how you match the Pay Code to the box calculation on your returns forms.
Canadian Payroll Pay Code examples for T4 and RL1
| Canadian payroll pay code examples | |||
|---|---|---|---|
T4 |
RL1 |
||
BEN-EXP |
System tax code |
BEN-EXP |
System tax code |
BONUS |
Taxable bonus pay |
BONUS |
System tax code |
COMMISSION |
Taxable commission pay |
COMMISSION |
Taxable commission pay |
CPP |
System tax code |
EARNTAX |
Taxable earnings |
CPP-E |
System tax code |
EI |
System tax code |
EARNTAX |
Taxable earnings |
PEN-EXP |
System tax code |
EI |
System tax code |
OPPE |
System tax code |
EI-E |
System tax cod |
QPP |
System tax code |
OT |
Taxable overtime Pay |
QPPE |
System tax Code |
PEN-EXP |
System tax Code |
RPP |
Pension plan employee contribution |
QPP |
System tax Code |
TAX-PQ |
System tax Code |
RPP |
RPP pension contribution (Canada only) |
TAXB-PQ |
System tax Code |
RPPE |
RPP pension employer contribution (Canada only) |
UNION |
Union dues |
RRSP |
RRSP pension contribution |
VAC-EXP |
System tax Code |
RRSPE |
RRSP pension employer contribution |
VACATION |
System tax Code |
TAX |
System tax Code |
VACPAYOUT |
System tax Code |
TAXB |
System tax Code |
||
UNION |
Union dues |
||
VAC-EXP |
System tax Code |
||
VACATION |
System tax Code |
||
VACPAYOUT |
Vacation Payout |
||
US Payroll Pay Code examples for W2
125 |
125 Cafeteria (deduction before tax) |
401K |
Employee pension contribution (RRSP) |
BEN-EXP |
System tax code |
COMMISSION |
Taxable commissions |
DEDBEFTAX |
Before tax deduction |
EARNTAX |
Taxable earnings |
EIC PAY |
System tax code |
FED TAX |
System tax code |
LOCAL TAX |
System tax Code |
MED |
System tax Code |
OT |
Taxable overtime earnings |
SST |
System tax Code |
STATE TAX |
System tax Code |
VACATION |
System vacation Code |
VACPAYOUT |
Vacation Payout |
VAC-EXP |
System tax Code |
Example of a Basic Payroll Pay Code Setup
Before you begin, determine the following:
-
Will Multi-State Code reporting be required?
If no, follow basic Payroll setup. If yes, add additional tax Codes for each required State. -
Are there more than 250 Employees?
-
If there are less than 250 Employees, use Form Reporting Supplied (Crystal reporting).
-
If there are more than 250 Employees, EDI Transmittal of Federal reporting will be required and you will need to set up pay codes to accommodate your Company’s pay structure. Refer the examples listed below.
-
The following are just examples grouped by a suggested class structure to use if your company does not have a defined set of payroll codes already in place to provide a good model for a starting point. Most of the samples would work for any company but some of the sample codes would only apply to Canadian payroll, (e.g., PQ-%), and some would only apply to US payroll, (e.g., 401K).
Taxable Earnings Pay Code Examples
| Code | Description |
|---|---|
SAL |
Salary wages (basic setup) |
SALOFF |
Salary office staff |
SALSHOP |
Salary shop staff |
SALMAN |
Salary management |
HOUR |
Hourly wages (basic setup) |
HOUROFF |
Hourly office staff |
HOURSHOP |
Hourly shop staff |
LOCAL |
Local driver |
LINE |
Line haul driver |
MISCEARN |
Miscellaneous earnings |
VACEMP |
Vacation - Employee (**only if not using accrual method to Pay vacation) |
Non-Taxable Earnings Pay Code Examples
| Code | Description |
|---|---|
REIMBUR |
Reimbursements |
BUSEXP |
Business Expense |
Taxable Benefits Pay Code Examples
Use if applicable.
| Code | Description |
|---|---|
BENEFIT |
Employee Company Benefit |
PQ-% |
Private Health plan that is a taxable benefit for residents of Quebec (taxable for provincial purposes but not for federal). User must set the Code as described and select the Class 'Benefit (Taxable)'. |
Taxable Employer Pension Pay Code Example
Use if applicable.
| Code | Description |
|---|---|
401KEMP |
401K Employer contributions to 401K |
Sample Pay Code for Defining Before-Tax Deductions
Will take the deduction before calculating FED, STATE, FUTA, MED, SST.
| Code | Description |
|---|---|
125MED |
Medical - 125 Cafeteria Plan |
Sample Pay Codes for Defining After-Tax Deductions
Will calculate all regular deductions before taking this deduction.
| Code | Description |
|---|---|
ADVANCE |
Advance |
CHILD |
Child Support deduction |
PHONE |
Cell Phone Charge |
LOAN |
Loan |
UNIFORM |
Uniform fees |
COMMCHK |
CommCheck deduction |
MISCDED |
Miscellaneous deduction |
System Pay Codes for US Payroll
Here are some SYSTEM Pay Codes specific to US Payroll (basic setup):
| Code | Description |
|---|---|
FED TAX |
Federal Tax - employee |
FUTA |
Federal Unemployment Tax - employer |
FUTA-EXP |
Federal Unemployment Tax expense |
LOCAL TAX |
Local Tax - employee |
MED |
Medicare - employee |
MED-E |
Medicare - employer |
MED-EXP |
Medicare expense |
PEN-EXP |
Pension expense (if applicable) |
SST |
Social Security Tax - employee |
SST-E |
Social Security Tax - employer |
SST-EXP |
Social Security Tax expense |
STATE TAX |
State Tax - employee |
SUTA |
State Unemployment Tax - employer |
SUTA-EXP |
State Unemployment Tax expense |
State Taxes Pay Code Examples
| Code | Description |
|---|---|
STATE TAX |
State Tax - employee (default) |
STATECA |
CA State Tax - employee |
STATEIA |
IA State Tax - employee |
STATEWA |
WA State Tax - employee |
SUTA |
State Unemployment Tax - employer (default |
SUTACA |
CA State Unemployment Tax - employer |
SUTAIA |
IA State Unemployment Tax - employer |
SUTAWA |
WA State Unemployment Tax - employer |
SUTA-EXP |
State Unemployment Tax expense |
SUTACA-EXP |
CA State Unemployment Tax expense |
SUTAIA-EXP |
IA State Unemployment Tax expense |
SUTAWA-EXP |
WA State Unemployment Tax expense |
Vacation (Accrual) System Pay Codes
Here are some SYSTEM Pay Codes specific to US Payroll (basic setup):
| Code | Description |
|---|---|
VACATION |
Vacation Accrual |
VAC-EXP |
Vacation Expense |