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 setup 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 Commission Pay Code Example

Use if applicable.

Code Description

COMMIS

COMMIS

Taxable Bonus Pay Pay Code Example

Use if applicable.

Code Description

BONUS

BONUS

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 Union Dues Pay Code Examples

Use if applicable.

Code Description

UNION

Union Dues

Taxable Pension Pay Code Example

Use if applicable.

Code Description

401K

401K Employee Deductions

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

Vacation (Employee Payout) Pay Code Examples

Code Description

VACOFF

Vacation Office Staff

VACHOUR

Vacation Hourly Staff

VACMAN

Vacation Management

Overtime Pay Code Examples

Use if applicable.

Code Description

OTOFF

Overtime Office Staff

OTHOUR

Overtime Hourly Staff

OTMAN

Overtime Management