January 14, 2017

Four tips for using an online payroll calculator

When calculating payroll, an online payroll calculator is a useful tool.

If you are looking for guidance on calculating provincial payroll deductions for a salary, commission, pension or to verify CPP contributions and EI premiums, the CRA Payroll Deductions Online Calculator is helpful. As of January 2014, tax rates, claim codes and thresholds are included.

One thing to be aware of when looking for an online payroll calculator is results are merely estimates, and getting it wrong can lead to compliance issues, or worse yet CRA fines. Below are guidelines to consider when using a payroll calculator.

1. Enter accurate information, the calculations are only as accurate as the information you provide.

2. Understand there is risk involved in the DIY approach, as per Canada Revenue’s website “you assume the risk associated with using this calculator.”

3. Make sure you use the correct calculator for each province. For example, the CRA Payroll Deductions Online Calculator isn’t applicable in Quebec.

4. Be sure your calculator is based on the most recent legislation.

If you would rather not calculate payroll yourself, look for certified payroll professionals to do it for you. Check out our blog for additional resources and information for small businesses.

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