2 Replies Latest reply on Apr 14, 2016 1:06 PM by Remi C. Corriveau

    Pre tax deduction not reducing taxes on off cycle correction run

    Ify Mosindi


        I am hoping someone can help with the situation we are facing. (Payroll Canada)

      Issue is that when we pay an ee after payroll has exited, and we process an off cycle correction run, the expected result is for the amount that goes to  pre tax deduction (/106) to reduce ee's taxable income (/102), but it is not, and ee is paying more taxes that he should.


      ee's result before off cycle


      I paid the ee $80 on IT15, so he can have money available for the deduction I created on IT14 $20 union dues, which is pre tax



      off cycle. I will label the two results here RT1 and RT2



      /101, /102 increased by $80 paid

      /301 also increased here, but the pre tax ded wt I entered on IT 14 is not on this result, instead, it went into arrears on function PRDNT




      function KATAX par ICTX for RT1

      You can see that we have the new /102, but /106 did not update with the $20 pre tax ded wt. this means that ee will pay more tax than they should.


      RT2. This is where the deduction takes place, but by this time, the taxes have already calculated on RT1. This defeats the purpose of it being a pre tax deduction because ee's /102 is not reduced by it.