PowerPoint Slides
to accompany
Copyright © 2013 by Nelson Education Ltd.
Premium 2012
Setting Up the
PAYROLL
Module
Contents



Payroll Concepts: Review 3
The PAYROLL Module: Overview
Setting PAYROLL to READY
1. Set PAYROLL Module Defaults
Names 9
Additional Payroll 10
Incomes 11
Deductions 12
Taxes 13
Entitlements 14
Remittance 15
Job Categories 16
7
9
2. Set Link Accounts
17
3. Enter Employee Information in Employee Ledger
4. Set PAYROLL to READY 23
18
Slideshow 7A
Payroll Concepts: Review
Gross Earnings
Before learning Simply payroll
procedures, it would be best to
review some relevant payroll
concepts.
Let us first discuss how to
determine net pay for each
employee:
Net Pay = gross earnings – payroll deductions
Gross Earnings

Gross earnings represent the total
compensation earned by the employees.

Basically there are three types of
compensation that constitute gross
earnings:
Click and study the notes on
GROSS EARNINGS at the right.
Click to continue.
1.
2.
3.
Wages – usually paid to an hourly employee.
They are determined by multiplying the
hourly rate by the number of hours worked.
Salary – fixed compensation, usually set at a
per annum basis, paid at regular periods as
agreed upon between the employer and the
employee, or as per company policy.
Commission/bonus – compensation based on
performance. It is usually set as a percentage
of sales.
Payroll Concepts: Review
(continued)
Payroll Deductions
Click and learn about Payroll
Deductions at the right.
Payroll Deductions

Mandatory deductions consist of:
1.
Click to continue.
2.
3.

Other deductions may be:



Extended medical plans
Union dues
Voluntary deductions may be:





Canada Pension Plan (CPP) or QPP (in
Quebec)
Employment Insurance (EI)
Personal income tax
Purchase of Canada Savings Bonds.
Life insurance premiums.
Payment of merchandise purchased
from the company.
Charitable donations.
Payroll deductions information (table)
available from the Canada Revenue
Agency web site:
http://www.cra-arc.gc.ca/tx/bsnss/menu-eng.html
Payroll Concepts: Review
(continued)
Employer Payroll Costs
Click and study Employer Payroll
Costs at the right.
Click to continue.
Employer Payroll Costs

CPP
• Employer must match each
employee’s CPP contribution.

EI
• Employer is required to contribute
1.4 times each employee’s EI
deductions.

Workplace Safety and Insurance Board
(WSIB in Ontario)
• Employers pay a specified percentage
of their gross payroll to provide
supplemental benefits for workers
who are injured in the workplace.
The employer’s premium depends on
the industry sector and the
employee’s insurable earnings.
Payroll Concepts: Review
(continued)
Paid Benefits
Paid benefits, referred to in Simply
as Employee Entitlements, vary
from one company to another.
Canada Revenue Agency
guidelines will help you determine
which benefits are taxable and
which are not.
Click and study the notes on
paid benefits.
Click to continue.
Paid Benefits (Employee – Additional
Benefits)
Employees may have the right to receive
compensation for future benefits when certain
conditions of employment are met. Such benefits may
include:
1.
2.
3.
4.
5.
Paid vacation
Sick pay benefits
Paid holidays
Vehicle and/or clothing allowance
Professional development
PAYROLL Module: Overview
Payroll Entries: Manual
Accounting vs. Simply
Study the manual entries for an
employee whose basic wage is
$1,000.00 plus 4% Vacation Pay
($40.00). There are 3 entries:
Click.
Entry 1 is to record the payroll
cheque information.
Click.
Entry 2 is to record the payroll
benefit company expenses.
Click.
Entry 3 is to record other benefit
company expenses.
Click.
When you print a payroll cheque
for an employee, Simply combines
all three entries in one journal
entry.
Click to continue.
Setting PAYROLL to READY
The PAYROLL Module keeps track of
employees’ personal information,
compensation arrangements, hours
worked, government deductions, etc.
The Simply program contains tax
tables and formulas that allow you to
calculate wages and government
deductions (source deductions).
For a fee, you can get updated tables
and formulas based on information
from Canada Revenue Agency
through Simply’s web site
Steps in Setting PAYROLL
to READY:
1.
In Simply, you can print payroll
cheques, T4 slips (summary of
employees’ earnings/deductions for
tax purposes) and employee-related
reports. You will find step-by-step
instructions in your text. The next
slides will give an overview.
Set PAYROLL System Settings.
• Names
• Additional Payroll
• Incomes
• Deductions
• Taxes
• Entitlements
• Remittance
• Job Categories
2.
Set up linked accounts.
3.
Enter payroll information for each
employee.
Click and study each step in
setting the PAYROLL Module to
READY.
4.
Set PAYROLL to READY.
www.NA.Sage.com/Sage-SimplyAccounting
Click to continue.
Setting the PAYROLL
Module to READY
When converting PAYROLL into
Sage Simply Accounting, whether
converting from a manual system or
from another computerized system,
you need to balance all payroll
earnings, deductions, and liability
accounts in the old General Ledger
system. It also involves setting up the
proper company records in Simply.
Step 1: Set PAYROLL Module
Defaults
The PAYROLL module defaults
provide information about the way
employees are paid.
Names
In this window, you can change the
name of the provincial payroll tax,
workers' compensation, payroll
entitlements, user-defined expenses,
and the Additional Information boxes
in payroll.
Click INCOMES & DEDUCTIONS and study
typical Name entries.
Click to continue.
Step 1: Set PAYROLL Module
Defaults (continued)
The Income chart specifies the
linked accounts and the names by
which the accounts will appear on
payroll documents. They define the
types of income paid by the company
other than regular wages (in blue).
Notice the names changed for
Incomes 1-3.
Click.
Simply provides up to 20 linked
accounts for deductions. The sample
company uses four deductions.
Names need to be defined before
you can proceed to set the PAYROLL
module to READY.
Click.
Additional Payroll
The sample company uses only the
Worker’s Comp. field. Study the
other fields available.
Click to continue.
Step 1: Set PAYROLL Module Defaults (continued)
Incomes
It is best to set up NAMES first before setting up Incomes. In this screen, you will specify type, unit of measure and
method of calculation for each type of income. The column is checked  if you calculate Income before the column
deductions.
Click.
Study the explanation of some of the important terms on the Income Settings screen.
Click to continue.
Benefits refer to taxable benefits such as
car allowance, educational benefits, etc.
Hourly Rate – rate paid for regular work. This
default can be changed to:
Differential Rate – rate paid to employees for
working shifts or higher job classifications.
Reimbursement refers to repayment of
company-related expenses, such as
travel. It is not subject to any taxes.
Step 1: Set PAYROLL Module Defaults (continued)
Deductions
Notice that Pension deduction can be entered as an amount or automatically calculated according to percentage
of gross income.
Click.
Read the explanation on how each of the items with check marks in this column are calculated.
Click.
Click TAXES on the left panel.
Check this box if you calculate the deduction after
calculating tax. Leave the box unchecked if you deduct
the amount before calculating tax.
Deductions are monies withheld on employee paycheques. Depending on the deduction, some or all taxes may
have to be calculated before the deduction is subtracted from the payroll cheque. There are no pre-defined
deductions in Sage Simply Accounting, so you need to check with your federal and provincial authorities to
determine which deductions you need to define and which taxes apply to specific deductions.
Step 1: Set PAYROLL Module Defaults (continued)
PAYROLL Settings: Taxes
Click each setting under Employer Tax Expenses starting from EI Factor for new Employees: to show
the explanation.
Click ENTITLEMENTS on the left panel.
Current federal government law requires
The
name oftothe
Workers'
employers
contribute
to Employment
Compensation
Boardon
rate
Insurance (EI) based
thevaries
employee’s
from
province
to
province.
In
EI payroll deduction times this factor. If
Ontario,
it is WSIB
(Workmen’s
you subscribe
to SimplyCare
with
Safety
Insurance
Board).
Payroll, the EI rate is included in payroll
calculations.
Otherwise,
This
tax covers
employer you need to get
this
rate
from
the
CRA
and
EHT
(Ontario
only)
refers
tomanually
contributions to provincial
workcalculate
employee
andThe
employer
Employee
Healthdisability
Tax.
related
employee
amounts.
employer
isCheck
exempt
from
this
programs.
your
(Quebec
only)
Thiswith
refers
to the
tax
if
the
payroll
does
not
provincial
toyour
determine
theis set
Depending
on howHealth
company
multiple
of authority
Québec
Services
exceed
$400,000
for thebe using.
default
rate
you
should
up, this
factor that
can the
be lower
for some
Fund
premium
employer
current
year.on the nature of the
Depending
employees.
You can set individual
must
pay.
employee's
work,
thisrecords.
rate canThere are
factors in employee
change.
Youcircumstances
can set individual
ratesyou
also some
in which
indoemployee
not needrecords.
to calculate EI for an
employee (for example, if the employee
is related to the company owner).
Step 1: Set PAYROLL Module Defaults
(continued)
Entitlements
Entitlements are a way for you to track
time off that employees are entitled to.
You can create up to 5 default
entitlements that will apply to all new
employees. If you want to add a newlycreated entitlement to an existing
employee record or change parts of an
entitlement for specific employees, you
can do so in the employee records.
Entitlements do not affect your books in
any way, they are intended strictly for
keeping track of time. When you are
processing a paycheque for an
employee, you can review, edit, and
release time on the Entitlements tab.
Because entitlement time calculations
are based on days, the numbers in the
paycheque window represent days.
Entitlements are defined in companywide settings, can be individually edited
in employee records, and are calculated
when you process a paycheque.
Click REMITTANCE on the left panel
to continue.
Step 1: Set PAYROLL Module Defaults (continued)
Remittance
Read the instructions on top of the page (arrow pointing). This feature calculates the amount of remittance due to
the specified payroll authorities for the previous month.
The Balance Forward amounts are the balances of the corresponding accounts by the Balance Forward Date.
Click JOB CATEGORIES to continue.
Read this. When you process payroll, tax and other deductions are withheld from
employee . These payroll deductions, along with any employer contributions and
expenses are owed to payroll authorities (remittance recipients).
Step 1: Set PAYROLL Module Defaults
(continued)
Job Categories
Job categories are a convenient
way to track payroll-related revenues
and expenses and identify
employees who submit time slips.
For example, if you create a Sales
category and assign this category to
all your salespeople, you can track
their revenues on sales invoices.
You can assign an employee to a job
category in their record or you can
assign multiple employees to
categories in the Settings > Payroll Job Categories window. The default
is <none>.
If you have employees assigned to a
job category that includes
salespeople, you can select one of
these employees to be the primary
salesperson for each of your
customers.
Click to continue.
Read
Step 2: Set up Linked
Accounts
Linked accounts reduce the amount of
time you spend assigning amounts to
your accounts whenever you process a
transaction.
For example, whenever you make a
sale, the amount your customer owes
you increases, the quantities in inventory
decrease, and Sage Simply Accounting
automatically records any sales taxes,
freight charges, and early-payment sales
discounts in the proper accounts. These
are the options for LINKED ACCOUNTS:
Payroll
Groups
Payroll Linked
Linked Accounts
Accounts –– Expense
User-Defined
Expenses
Payroll Linked Accounts - Taxes
Payroll
PayrollLinked
LinkedAccounts
Accounts- -Income
Deductions
Monies deducted for these items are
automatically tracked in the LINKED
ACCOUNTS
Study the LINKED ACCOUNTS on the Income page.
Study the Incomes page and the
explanation at the bottom.
Click Deductions above and
continue by clicking the other
options.
Click to continue.
Payroll cheques will be credited from the BANK ACCOUNT defined as
User-Defined Expenses and Payable accounts would be used when the
the
Principal Bank and employee advances (if any) will be applied
company pays for various benefits (insurance, dental benefits, etc.) and/or
against
the account
defined in the Advances & Loans box. Vacation Pay
any payment
adjustment.
is automatically accumulated in the account entered in the Vac. Owed
box.
The Payroll Expense Groups would be used when you want to report the
same employees expenses at different locations, job categories, different
The Payment Adjustment accounts would be used for minor discrepancies in
administration departments, etc.
amounts.
Step 3: Enter Employee
Information in Employee
Ledger
Before the PAYROLL module can be
used, employee personal information
must be set up and historical data for
each employee should be entered.
Study a typical Payroll Ledger at the
right. Some of the tabs may not be
relevant when converting PAYROLL
at the beginning of the year.




Study the Personal page now and
then click each TAB name below from
top to bottom. Click the numbers on
each page in proper order and study
the corresponding explanation.


Taxes
Income

Deductions
WSIB & Other Expenses


Personal Page
Taxes Page
Entitlements
Direct Deposit
Memo
Additional Info
T4 and RL-1 Reporting
Click to Continue









Deduct
EI
A-check
mark
inthe
this
box
indicates
that
the
employee
is
eligible
for
RateTable
–Personal
Current
Federal
Government
law
requires
the
employer
to
contribute
to
Deduct
CPP/QPP–
A
check
mark
in this
box
indicates
that
the
employer
would
YTD
Amount
Sage
Simply
Accounting
automatically
updates
the
YTD
amount
Additional
Federal
Tax
–
employee
so
desires,
he
orclaimed
she
request
the
Tax
-–The
employer
is
responsible
calculating
and
submitting
the
CPP
Basic
Amount
(Federal
and
Provincial)
the
amount
of
personal
Other
Indexed
Amounts
isIf
the
amount
of in
additional
Federal
Taxmay
Credits
that
can
Non-Indexed
Amounts
–benefits.
additional
amounts
thatiscan
be
by
thetimes
particular
Employment
Insurance
Employment
Insurance
based
on
the
employee`s
EI
payroll
deduction
the
deduct
CPP/QPP
contributions.
However,
the
check
mark
will
be
removed
if
the
for
the tax items
in
this
box
whenever
atax
pay
cheque
for the
employee
employer
deduct
additional
income
each
period.
Theon
percentage
of
contributions,
EIamount
premiums,
and
income
tax
deductions
based
the is
taxposted.
tables
exemption,
the
of personal
income
not pay
subject
to
taxes
be
claimedtoby
the
particular
employee.
employee.
ratenote
entered
here.
employee
was
receiving
a disability
pension
and
works
onofathe
fullcompany’s
or part-timeshare
The
below
(see
reddeduction
arrow)
isAgency.
updated
every
pay
period.
additional
Federal
Tax
is
entered
here.
released
by
the
Canada
Revenue
The
calculation
basis.
also
employees
whotax
aretables.
receiving
of
CPPItand
EIapplies
are alsotobased
on these
SageCanada
SimplyPension.
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Note: The all
Additional
Taxto
box
greyed out
because
Ontario has
calculates
of these Quebec
according
theisprovince
where
the employee
is been
Note:
The
Deduct
QPIP
box
is
greyed
out
because
Ontario
is
entered
the Tax
selected inItthe
Tax Tablenecessary
Box.
employed.
is therefore
to enter the correct province in thisinbox.
Table box.
Step 3: Enter Employee
Information in Employee
Ledger (continued)
Continue clicking the remaining tab
names. Click the numbers (if any) in
chronological order and study the
related information.
This indicates that this employee is paid bi-weekly
(52 weeks/26=2)
Income

Deductions
WSIB & Other Expenses

Entitlements
Direct Deposit
Memo/Additional Info
T4 and RL-1 Reporting








Income Page
Click to Continue




This
Net
This
Pay
box
is
is
the
the
is
for
automatically
rate
accumulated
Retain
which
Vacation
calculated
vacation
amount
is
checked
of
pay
and
Vacation
for
to
entered
the
accumulate
Pay
employee
inowed
this
vacation
box.
to
is
the
based.
employee.
pay
for
the is




 The
The
This
This
amount
is
is
the
the
YTD
hourly
normal
hourly
ofon
amount
payroll
wage
wage
weekly
loan
received
rate
rate
hours
to
paid
paid
beby
repaid
of
to
to
the
the
the
employee
employee.
employee
by
employee
the
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for
in
This
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each
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When
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ascalendar
it
year.
of
ais
default
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first
This

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overtime
pay
received
by
the
employee
for
the
current
year.
entered,
year. employee.
when
automatically
This
youit number
enter
is considered
It
the
accumulates
will
updated
payroll
show
a historical
details
at
aseach
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a default
for
pay
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by
the
week
period.
when
employee
As
until
you
thethe
enter
at
employee
employee
a payroll
the payroll
repays
run.
takes
employee
the
a vacation.
loan, the
YTD
details
amount
at a payroll
changes.
run.
Step 3: Enter Employee
Information in Employee
Ledger (continued)
Continue clicking the remaining tab
names. Click the numbers (if any)
in chronological order and study
the related information.
Deductions
WSIB & Other Expenses
Entitlements
Direct Deposit
Memo/Additional Info
T4 and RL-1 Reporting
Click to Continue
WSIB & Other
Entitlements
Page
Expenses Page
Deductions Page
On this
page,
you would
record
the entitlements
sickrate
days)
an employee
When
a new
employee
ledger
is created,
the WSIB(like
current
is automatically
receives,
the number
a work
day. you need to update the rate in
entered
as and
a default.
When of
thehours
WSIBinrate
changes,
Notice that the deductions are entered either in percentage or in particular
every employee’s ledger.
amount per pay period. The USE (leftmost) column allows specific deductions for
particular employees. The YTD amounts are also shown (rightmost column).
Step 3: Enter Employee
Information in Employee
Ledger (continued)
Continue clicking the remaining tab
names. Click the numbers (if any)
in chronological order and study
the related information.
A check mark in this box indicates that this employee’s
net pay should be deposited directly to her bank;
therefore, the bank details should be entered below.
Direct Deposit
Memo/Additional Info
T4 and RL-1 Reporting
Read this.
Click to Continue
Direct Deposit Page
To use Sage Simply Accounting Direct Payments, you would create a payment or
receipt within Sage Simply Accounting. The software uploads the payment or
receipt file to your Sage Simply Accounting Direct Payments Online Account
which sends the payment/receipt data to the company bank. The bank then
processes the payment to the recipient's bank account or sets up acceptance of
payment from a customer's account. You therefore need to make necessary
arrangements with your bank and the employees’ banks.
Step 3: Enter Employee
Information in Employee
Ledger (continued)
Continue clicking the remaining tab
names.
Memo Page – You may enter personal
information such as emergency name(s) and
number(s) to call, etc.
Memo
Additional Info
T4 and RL-1 Reporting
Click to continue.
Additional Info Page
You may use the various fields to record
additional information such as wage
increase dates, performance review
reference, etc. If relevant, you may choose
to display information when the employee
is selected in a transaction by checking
the relevant box (see red arrow).
T4 & RL-1 Reporting
YTD EI Insurable Earnings for the current year.
Pensionable earnings recorded under the CPP
Plan for the current year.
The Registered Pension Plan no. registered with
the Federal Government.
Step 4: Set the PAYROLL
module to READY.
As in other modules, it is important
to back up your data before setting
the PAYROLL module to READY.
Click PAYROLL now.
Simply will check the PAYROLL
database file of the company and
display an error report, if any. You
are required to correct the error
before Simply will allow you to set
the PAYROLL module to READY.
Study the sample report at the
right.
Click.
Assuming you do not have any
error, or after you have corrected
your error(s), you will receive this
message. At this point, you have
another chance to backup your
company files if you have not done
it yet.
Your PAYROLL module will then be
ready for processing transactions.
Click to continue.
More…
Go back to your text and
proceed from where you have
left off.
Review this slideshow when
you finish the chapter to better
prepare yourself for the next
chapter.
Press ESC now, then click the
EXIT button.
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