If you’re a business owner or a bookkeeper, you know the struggle of running payroll. Software like QuickBooks can make it a bit easier by automating certain parts of the process and giving you peace of mind that your employees are paid accurately and that their tax deductions are correct.
Here are three things you can do in QuickBooks that we recommend taking advantage of if you’re looking for ways to optimize your payroll process.
1) Calculate income tax and other deductions using QuickBooks
QuickBooks makes it a little easier to keep track of how much tax to deduct from each of your employees.
Once an employee submits their TD1 forms (Federal and Provincial), you can enter the info into QuickBooks, and the correct amounts will automatically be deducted from their future paychecks.
Learn how to enter TD1 information into QuickBooks here.
2) Account for income tax using QuickBooks
As an employer, you’re required to regularly report and remit your payroll deductions and contributions to the Canada Revenue Agency (CRA) by filing a PD7A form.
QuickBooks calculates and fills in your PD7As automatically. Simply print the report so that you know your remittance amount. PD7As are most often filled in on a monthly basis and are due on the 15th of the month following the reporting period (e.g. the remittance for your January payroll will be due by February 15). If your business is deemed an accelerated filer, your filing frequency may differ. See the CRA’s guide to paying (remitting) source deductions for more info.
You should be reconciling your total remittances at least twice a year. You can do this by comparing the total you have actually paid versus the total PD7A calculation in QuickBooks. We recommend you do this in July (for the January to June period) and again in January (for the remainder of the year).
Learn how to access your PD7A form here.
3) Prepare T4s for your employees in QuickBooks
QuickBooks allows you to easily prepare T4 slips for each of your employees.
You can use the software to verify your company and employee information, and then export pre-populated T4 slips to give to your employees electronically, by mail, or in person.
You will also have to file your T4 slips electronically with the CRA. You can do this through the CRA website.
Learn how to prepare T4 slips here.
Need Payroll Support?
Even with QuickBooks, payroll can take up a significant amount of time you might otherwise be able to spend running your business. If you could use a little help running payroll, our team can help.
Contact us any time.
- Video: How to Run Payroll in QuickBooks Online
- QuickBooks blog: Your Easy Guide to Payroll Deductions
- CRA website: Pay (remit) and source deductions
This post has been prepared for general information purposes. It is not advice. The information presented may not fit your unique situation, please consult one of our trusted business advisors at RHN CPA for further clarification and interpretation of your circumstances.