Payroll Glossary

The first additional Canada Pension Plan contribution introduced through the CPP enhancement. It applies to pensionable earnings up to the YMPE and is included with CPP contributions on payroll records and T4 slips.

An extra amount of income tax an employee asks the employer to deduct from each payment, usually through their federal TD1 form.

A Canadian banking file format used for bulk electronic payments. NuvoWage can prepare employee direct-deposit credits for an authorized payroll user to review and submit through the employer's financial institution.

A non-refundable tax credit amount used when calculating income tax deductions. An employee may claim the applicable federal and provincial or territorial amount on their TD1 forms.

A payment in addition to regular earnings. Payroll income tax may use the CRA bonus method rather than treating the amount as ordinary periodic pay.

A statutory pension plan funded by contributions from eligible employees and their employers. Payroll calculates contributions on pensionable earnings, subject to CRA rules and annual limits.

The federal agency that administers payroll accounts, source deductions, remittances, T4 information returns, and related federal tax obligations.

A code representing the range that contains an employee's total TD1 claim amount. Federal and provincial or territorial claim codes are determined separately and help calculate payroll income tax.

Pay based on sales, results, or another agreed measure. Commission may be paid periodically or as a non-periodic payment, and special TD1X calculations can apply in some situations.

The portion of annual pensionable earnings excluded from base CPP contributions. Payroll allocates the exemption by pay period and applies special proration rules when required.

The second additional CPP contribution on eligible pensionable earnings above the YMPE and up to the YAMPE. The employee and employer generally contribute matching amounts.

An amount withheld from an employee's pay. Deductions can include statutory payroll deductions and authorized amounts such as benefit premiums, union dues, or loan repayments.

A NuvoWage entry mode where the payroll user enters gross earnings and applicable payroll items directly instead of calculating regular pay from hours and rates.

An amount paid by the employer in addition to employee gross pay, such as the employer share of CPP or CPP2 and the employer EI premium. It does not reduce the employee's net pay.

A federal program funded through employee premiums and employer contributions. Payroll calculates EI on insurable earnings, subject to CRA rules and annual limits.

The federal portion of income tax withheld from an employee's pay using CRA payroll formulas, tax rates, credits, TD1 information, and year-to-date values when applicable.

Cash earnings payable to the employee before deductions. It excludes non-cash taxable benefits even though those benefits may be included in taxable, pensionable, or insurable amounts.

An employee's earnings before deductions. Depending on the report, gross pay may include cash earnings and taxable non-cash benefits, so the displayed context matters.

Earnings on which EI premiums are calculated and that are reported for EI purposes. Not every payment or benefit is insurable.

The amount payable to an employee after employee deductions are subtracted from gross cash pay. Employer contributions do not reduce net pay.

A benefit provided without a cash payment to the employee. A taxable non-cash benefit can increase taxable, pensionable, or insurable amounts without increasing the cash available for net pay.

A payment that is not part of regular recurring salary or wages, such as some bonuses or irregular commissions. CRA payroll tax methods can differ from those used for periodic pay.

Payroll totals recorded before an employee begins using NuvoWage partway through a calendar year. They help annual limits, reports, and T4 totals include earlier payroll processed elsewhere.

Additional pay for eligible overtime work, calculated using the applicable employment standards and employer policy. The rate or amount may be entered or calculated in a Pay Run.

The date employees are paid. NuvoWage uses the pay date to select the applicable tax package and to determine the calendar year for payroll and T4 reporting.

How often regular payroll is paid, such as weekly, biweekly, semi-monthly, or monthly. The frequency determines the number of regular pay periods used by payroll formulas.

The span of time covered by a payroll payment. The period start and end describe when work or salary was earned; the pay date determines the tax package and reporting year.

A group of employee payroll calculations processed for a pay period and pay date. A draft can be edited and recalculated; finalization locks the payroll results used by downstream records.

The employee document showing earnings, deductions, net pay, and year-to-date information for a finalized payment. NuvoWage can publish it securely to an invited employee account.

The CRA program account an employer uses for payroll deductions and reporting. It combines the employer's nine-digit business number, the RP program identifier, and a four-digit reference number.

An amount withheld or calculated through payroll. The term may refer to statutory source deductions or to another employee-authorized deduction, depending on context.

The CRA online calculator used to calculate and verify common payroll deductions. NuvoWage retains selected PDOC comparisons as calculation evidence, but it is independent software and is not endorsed by the CRA.

A configured earning, benefit, or deduction used in NuvoWage. Its settings describe tax treatment, pensionability, insurability, cash treatment, recurrence, and employee or employer portions where applicable.

A CRA review that compares required CPP contributions and EI premiums with the pensionable and insurable earnings and amounts reported on T4 slips. A difference can lead to a PIER report.

Earnings on which CPP or CPP2 contributions may be calculated. Not every payment or benefit is pensionable, and annual limits still apply.

The province or territory used for payroll deduction purposes under CRA place-of-employment rules. It can differ from where the employee lives and determines the provincial or territorial tax calculation outside Quebec.

The provincial or territorial portion of income tax withheld from pay. It is calculated using the employee's province of employment, applicable tax data, credits, reductions, and surtaxes.

A Service Canada record of an employee's work history and insurable earnings, generally issued when an interruption of earnings occurs. It is used to help determine Employment Insurance benefit eligibility. NuvoWage does not currently submit ROEs.

An employee contribution to a registered pension plan deducted through payroll. An allowable RPP deduction can reduce the income used to calculate payroll income tax.

The payment an employer sends to the CRA for source deductions and employer contributions. The amount and due date depend on the employer's payroll activity and CRA-assigned remitter type.

The CRA category that determines how often an employer must remit payroll deductions and employer contributions. Employers should use the remittance frequency assigned or confirmed by the CRA.

A payment caused by a pay-rate increase that applies to one or more earlier pay periods. CRA has a specific income-tax method for qualifying lump-sum retroactive payments; ordinary late wages are not automatically retroactive pay.

A NuvoWage status meaning a result or employee record needs attention before finalization. The app identifies the affected record and explains what the payroll user should verify.

Amounts withheld from employee pay for income tax, CPP or CPP2 contributions, and EI premiums. Employers remit these amounts together with their applicable contributions.

Pay related to a public or statutory holiday under the applicable provincial, territorial, or federal employment standards. Eligibility and calculation rules are separate from CRA payroll deduction formulas.

The employee's employment income before deductions, including applicable salary, wages, bonuses, vacation pay, tips, honorariums, and taxable benefits reported under CRA rules.

The employee CPP contributions withheld on pensionable earnings. Box 16 reports CPP contributions, including the first additional CPP amount, while Box 16A reports CPP2 contributions when applicable.

The employee Employment Insurance premiums withheld during the calendar year and reported on the T4 slip.

The total income tax deducted from the employee during the calendar year, including federal and provincial or territorial income tax withheld through payroll.

The insurable earnings reported for EI purposes on the T4 slip, subject to CRA reporting rules and the annual maximum.

The pensionable earnings reported for CPP or QPP purposes on the T4 slip, subject to CRA reporting rules and the annual maximum. NuvoWage does not calculate Quebec payroll.

The CRA code reporting the employee's access to employer-offered dental insurance or dental coverage on December 31. It reports access to coverage, not the value of a taxable benefit or a payroll deduction.

The employee information slip reporting employment income, deductions, pensionable and insurable earnings, and other required information for a calendar year.

The CRA electronic filing format for a T4 information return. It is submitted to the CRA and is different from the employee-facing T4 PDF copy.

The CRA publication containing payroll deduction formulas for computer programs. NuvoWage applies these formulas with effective-dated tax data selected by pay date.

An amount used to reduce calculated income tax. Payroll tax credits can come from TD1 claims and from amounts built into the applicable CRA formulas.

NuvoWage's versioned set of federal, provincial, and territorial payroll tax data for a defined effective period. The pay date selects the package used by the calculation engine.

A benefit or allowance that must be included in employment income under CRA rules. Its cash, non-cash, pensionable, and insurable treatment determines how it affects payroll.

The amount used in the payroll income-tax calculation after including taxable earnings and benefits and applying permitted payroll deductions. It is not always the same as gross cash pay.

A signed TD1 declaration that the employee's total income from all employers and payers will be less than their total claim amount. When valid, the employer does not deduct the applicable income tax described by that declaration.

The federal and provincial or territorial forms employees complete to tell an employer which personal tax credit amounts and elections to use for payroll deductions.

A CRA form that certain commission employees may use to have approved commission expenses considered when income tax is deducted. NuvoWage currently flags TD1X calculations as unsupported.

A NuvoWage status meaning the current engine does not support the required payroll calculation. The affected employee cannot be finalized until the situation is changed or handled outside NuvoWage.

Pay provided for vacation entitlement under the applicable employment standards and employer policy. It may be accrued and paid when vacation is taken, paid on each paycheque, or reflected through continued salary, as applicable.

A NuvoWage coverage status meaning saved CRA PDOC examples for the listed situation match to the cent. It describes the available calculation evidence and is not CRA certification or approval.

The payroll process of reviewing calendar-year totals, resolving reporting issues, and preparing employee T4 copies and the CRA information return.

Cumulative payroll amounts from January 1 through the current pay date. YTD values support annual contribution limits, payroll reports, and year-end reporting.

The second CPP earnings ceiling. CPP2 can apply to eligible pensionable earnings above the YMPE and up to the YAMPE.

The first CPP earnings ceiling. CPP contributions apply to eligible pensionable earnings up to this ceiling, and CPP2 can apply above it up to the YAMPE.