Tax Details

The Tax Details section allows payroll administrators to apply specific tax exemptions or adjustments to an employee when required. These are configured directly from the employee’s profile and ensure payroll calculations reflect the correct tax treatment based on employment circumstances, work location, or approved exemptions.

Follow the steps below to configure a tax property directly from the employee’s profile.

Available Tax Properties

The following tax properties overrides are available within the payroll component:

CPP, EI, QPP, and QPIP Exemptions

These overrides allow an employee to be exempt from standard statutory contributions when applicable.

Available exemption types include:

• CPP exempt

• EI exempt

• QPP exempt

• QPIP exempt

Available Tax Configurations

The following tax properties can be configured within the payroll component: Federal Annual Deductions at Source, First Nations Exemptions, Outside Canada Surtax Exemption, Province of Employment Override and Province of Work Override.

Federal Annual Deductions at Source

In some cases, employees expect a significant portion of their federal or provincial taxes to be refunded. When approved by the government, employees may be permitted to reduce or eliminate certain deductions at source rather than receiving a refund later. This override enables reduced federal tax deductions to be applied directly during payroll.

First Nations Exemptions

This override applies to employees who work on a reserve and are exempt from certain federal or provincial taxes under First Nations tax exemption rules. When enabled, applicable taxes are excluded from payroll calculations in accordance with the exemption.

Outside Canada Surtax Exemption

Employees who work outside of Canada but still owe Canadian taxes are generally subject to a provincial surtax instead of provincial taxes, as there is no province of employment. This override is used when an employee is exempt from the provincial surtax, ensuring the surtax is not applied during payroll processing.

Province of Employment Override

This override allows a custom province of employment (POE) to be set for a specific employee. When applied, the selected POE is used for tax calculations instead of defaulting to the business entity’s province. This is useful when an employee’s reporting office location differs from the entity’s registered province.

Province of Work Override

This override allows a custom province of work (POW) to be set for a specific employee. When applied, the selected POW is used for calculations instead of defaulting to the business entity's province or the employee's province of employment. This is useful when an employee's work location differs from the entity's registered province.

Steps to Create a Tax Property

1. Open the employee profile you want to update.

2. Navigate to the Tax Details tab.

3. Select + Tax Property to begin creating a new exemption/ tax property.

4. Choose the appropriate exemption type/ tax property from the list

5. Enter the Effective From date (required) and an Effective To date (optional) if the exemption should only apply for a specific period.

6. Click Create to save and apply the override.

Once created, it will update the employee’s tax settings and apply automatically to future payroll calculations within the specified date range.