Employee amounts are adjusted when you advance into a new fiscal year.
TD1 Claim Amounts
When we advance past the last pay period of the year, Abio is going to ask you if you want to set up employee TD1 amounts for the coming year. The TD1 amounts are used for calculating the amount of income tax to charge on each cheque.
Revenue Canada publishes a factor that you can apply to each employee’s current TD1 amount. Abio will set the rates for you. To review the new rates, and the factor that will be applied to the TD1 amounts, navigate to [c] Payroll, then [u] Set Up, then [h] Federal Tax Entry.
The federal index factor for 2020 is 1.900.
Abio will also update the provincial TD1 amounts. To review the provincial factor, navigate to [c] Payroll, then [u] Set Up, then [i] Provincial Tax Entry.
The index factor for BC is 2.5%
The TD1 amounts are stored on each employee’s record. To review an employee’s TD1 amount, navigate to [c] Payroll, then [a] Employee Entry.
Millie Jackson is only claiming the basic TD1 amounts as set out in the tax records.
If people have lower TD1 claims, the year end process may increase them to the minimum amount prescribed by the CRA and province.
Advancing the Fiscal Year
Abio knows you are moving into a new fiscal year when you advance the G/L into January of the new year. To do this, advance the pay period as usual. Navigate to [c] Payroll, then [l] Advance Pay Period.
When you have processed the final pay period of the tax year, your only choice is to advance the G/L into January. When you do that, Abio is going to prompt you to apply the federal and provincial tax factors to all the employee TD1 claims. Abio won’t allow you to advance the pay period into the new year until this is done.
So, rather than advance the pay period, you are forced to advance the G/L into January.
When you do this, Abio recognizes that it’s time to apply the CRA indexes to the employee’s TD1 amounts.
You can choose not to update the employee TD1 amounts.
Abio will confirm you wish to apply the factor.
Select Yes to continue.
Once you’ve advanced the payroll into January, you can advance into the first pay period of the new year.