Workaround Procedure - Federal Basic Personal Amount (BPAF) for the Year 2020

Objective

In reference to the release Payroll Holdbacks Computation Formula.

Performing the necessary modifications in maestro*, so payroll holdbacks for employees with an annual income greater than $150,473, are processed correctly.

 

Prerequisites

 

Steps

  1. Enter the federal basic personal amount in the Government Tables
 

maestro* > Time Management > Maintenance > Payroll > Government Tables

It is mandatory to enter the new BPAF - $13,229 - in the Basic Deduction field, under the Federal Tax tab of the Government Tables option.

  1. Enter the total amount of credits, for each employee, in the Employee Management option
 

maestro* > Time Management > Payroll > Employees > Employee Management

It is mandatory, for employees with an annual net income greater than $150,473, to enter the difference between the employee's real BPAF and $13,229 in the Additional credits (from TDI) field, in the Federal section, under the Income Taxes tab of the Employee Management option.

The complete explanation concerning this new formula is available HERE.

 

The new BPAF computation formula is the following:

Net Income ≤ $150,473, BPAF = $13,229
$150,473 < Net Income ≤ $214,368, BPAF = $13,229 - (Net Income - $150,473) x ($931 / $63,895)1
Net Income ≥ $214,368, BPAF = $12,298

NOTE: The Annual Net Income equals the addition of the Annual Gross Income + Annual Deductions granted to regional residents affected by regulations according to the TDI Form.

 

 

 

As mentionned in the T4127 - Payroll Deductions Formulas - 111th Edition form, effective January 1, 2020, the CRA stated that, for the year 2020, employers and payers could temporarily use $13,229 as the BPAF amount for their employees until their payroll deduction systems be put to date. Take note that the computation formulas were only recently published on January 13th.

Employees with a greater net income can demand more taxes be deduced by completing the TDI Form.

 

For more information, we invite you to contact our Software Support Team by phone at 1-877-833-1897 or by email at support@maestro.ca.

 

Last modification: September 19, 2024