T4 and RL-1 Data Entry

T4 and RL-1 Data Entry

In order to complete the T4 information return, you must enter each employee's information using separate T4 and RL-1 data entry forms.

Additional forms can be opened by choosing the "Add new forms" icon or by going to Forms, Add new form on the menu tool bar. Multiple data entry forms can be opened simultaneously by entering the requested number in "Number of copies selected for each form" in the "Add Forms" dialogue box.

A federal T4 slip will be automatically generated for every employee, however a RL-1 slip will only be displayed if the province of employment is Quebec. Data entered for the federal T4 slip will be used to calculate the Quebec RL-1 amounts. This amount can be overridden by using F3 or by right clicking on the line and entering the required amount. All overridden lines will be traceable through the diagnostic box.

Automobile Benefits:

Automobile benefits, box 34, can be calculated by right clicking on the line and choosing to drilldown. The drilldown will automatically open the automobile benefit form in the forms navigator. For more information on automobile benefits see Calculating Automobile Benefits.

T4 and RL-1 Adjustments to employee contributions:

DT FormMax offers the ability to adjust the employee's CPP/QPP and EI contributions. In order to activate this adjustment, you must make the request by ticking the box "Adjust employee contributions" on the bottom of the data entry form. This adjustment consists of calculating what the contributions should have been based on the income entered. In the case of over contributions, the excess amount will be added to the taxes withheld. On the contrary, in the case of under contributions, the difference will be subtracted from the taxes withheld.

Important dates

You must give employees two copies of their T4 slip on or before the last day of February following the calendar year to which the slips apply:

Note
If T4 slips are returned as undeliverable, we suggest that you retain the slips with the employee's file.

When to complete a T4 slip

You have to complete a T4 slip to report the following:

salary, wages (including pay in lieu of termination notice), tips or gratuities, bonuses, vacation pay, employment commissions, gross and insurable earnings of self-employed fishers, and all other remuneration you paid to employees during the year;
taxable benefits or allowances;
deductions you withheld during the year; and
pension adjustment (PA) amounts for employees who accrued a benefit for the year under your registered pension plan (RPP) or deferred profit sharing plan (DPSP).

Note
You have to report income on a T4 slip for the year during which it was paid, regardless of when the services are performed or rendered. For example, if a pay cheque dated in January covers income earned in the last days of December, report the income on the T4 slip for the year that starts in January.

You have to complete T4 slips for all individuals who received remuneration from you during the year if:

you had to deduct CPP/QPP contributions, EI premiums, PPIP premiums, or income tax from the remuneration; or
the remuneration was more than $500.

Note
If you provide employees with taxable group term life insurance benefits, you always have to prepare T4 slips, even if the total of all remuneration paid in the calendar year is less than $500.

If you provide former employees or retirees with taxable group term life insurance benefits you need to prepare a T4A slip.

Avoiding T4 completion errors

The most common reporting errors occur when you do not correctly complete the following boxes:

Box 24, EI insurable earnings
Box 26, CPP/QPP pensionable earnings
Box 28, Exempt (CPP/QPP, EI, and PPIP)
The following questions and answers may help you avoid these reporting errors and can serve as a checklist before you send in your information return.
CPP/QPP questions

Was the employee exempt from CPP/QPP for the entire reporting period?

If yes, put an "X" in box 28. Leave boxes 16 or 17 and 26 blank.
If no, make sure that you deducted contributions for each type of remuneration that is subject to CPP/QPP.

Did the employee turn 18 or 70 years old during the reporting period?

If yes, make sure that you:
started to calculate the CPP contributions and pensionable earnings effective the first pay dated on or after the first of the month following the employee's 18th birthday, (for example, an employee who turns 18 in October will have CPP deductions withheld from the first pay in November); or
stopped calculating the CPP contributions and pensionable earnings on the first day of the month after the employee's 70th birthday.

Note
The requirements are different for QPP. For information, see the Guide for Employers - Deductions and Contributions, which you can get from Revenu Québec.

Did the employee receive CPP or QPP pension benefits during the reporting period?

If yes, make sure that you calculated the CPP contributions and pensionable earnings based on the number of months before the pension became payable.

Note
The requirements are different for QPP. For information, see the Guide for Employers - Deductions and Contributions, which you can get from Revenu Québec.
If no, leave box 26 blank.

Did you deduct contributions from an employee's vacation pay, bonuses, director's fees, or other taxable benefits?

If yes, see Special payments for information on calculating contributions for vacation pay, bonuses, and director's fees. For information on taxable benefits, see Taxable Benefits.
If no, make sure that you deducted contributions for each type of remuneration that is subject to CPP or QPP.

EI questions

Was the employee exempt from EI for the entire reporting period?

If yes, put an "X" in box 28. Leave boxes 18 and 24 blank.
If no, make sure that you deducted contributions for each type of remuneration that is subject to EI.

Was the employee a student?

If yes, make sure that you deducted contributions for each type of remuneration that is subject to EI as you do for an ordinary employee. There is no age limit for deducting EI premiums.

Pensionable and Insurable Earnings

Each year, the calculations made on the T4 slips filed with the T4 Summary are checked.
This is done to make sure that the CPP and EI deductions remitted agree with the Pensionable and Insurable earnings reported.
The calculations are checked by matching the pensionable and insurable earnings reported with the required CPP contributions or EI premiums indicated in the Payroll Deductions Tables. These required amounts are then compared with the CPP contributions and EI premiums indicated on the T4 slips.

Note
Employer's will be responsible for remitting any balance due, including the employee's share.

If you have more than one payroll deductions account, you will have to file a separate return for each account.

After you complete your paper return, mail it to:

Ottawa Technology Centre
Canada Revenue Agency
875 Heron Road
Ottawa ON K1A 1G9

When you send the CRA copies of the slips, print two T4 slips to a page. This will allow them to process your information return faster.

You no longer need the T4 Segment. If you choose to use the Segment, split your slips into bundles of 200 slips (100 sheets), and include a Segment (available in electronic format only) on the top of each bundle.

Balance due
If you have a balance due, attach to the T4 Summary, a cheque or money order payable to the Receiver General for the balance owing. If you remit your payment late, any balance owing may be subject to penalties and interest at the prescribed rate.

The "Other information" area at the bottom of the T4 information slip has boxes with codes and amounts that relate to employment commissions, taxable allowances and benefits, deductible amounts and other entries.

Useful links:

Federal:
RC4120 Employers' Guide - Filing the T4 Slip and Summary
RC4157 Deducting Income Tax on Pension and Other Income, and Filing the T4A Slip and Summary
T4001 Employers' Guide - Payroll Deductions and Remittances
T4032 Payroll Deductions Tables
T4130 Employers' Guide - Taxable Benefits and Allowances

Quebec:
Guide for Employers Source Deductions and Contributions (PDF)
Guide to Filing the RL-1 Slip Employment and Other Income (PDF)