Throughout the end of 2020 and beginning of 2021, Humi is providing tailored Payroll Review Summaries for applicable employers via email. The purpose of the summaries is to help reveal basic errors in implementation or usage of Humi Payroll.
Depending on your payroll needs, the summaries will cover up to four main areas:
- Benefits and Income Types Summary
- 2021 Schedule Summary
- Temporary Wage Subsidy (TWS) Summary
- Pensionable and Insurable Earnings Review (PIER) Summary
This summary provides a breakdown of all benefits and income types that are set up or used within your Humi Payroll account in 2020. It's designed to reveal any incorrect configurations, which are some of the most common causes of benefits-related discrepancies at year-end.
It is important to verify each item in this summary using the benefits reference chart and the special payments reference chart published by the CRA.
If not already, also review your existing benefits and assign applicable box codes to specify which T4 box the benefit will be reported in.
Note that Box 14, 16-18, 22, 24, and 26 are automatically assigned by Humi Payroll based on the benefit's taxable / pensionable / insurable settings. For additional context, learn more about managing benefits and managing income types in Humi Payroll.
During the initial Humi Payroll implementation process, schedule configurations are set up in the payroll settings page. Each pay period contains five key dates: start date, end date, deadline, cheque date and pay date. Learn more about pay period dates here.
Important things to review
Number of pay periods in 2021
Ensure that the number of pay periods in the summary matches the number of periods you expect for 2021 from the schedule's frequency.
Monthly: 12 periods in a year
Semi-monthly: 24 periods in a year
Weekly: 52 periods in a year (or 53 periods once every 7 years)
Bi-weekly: 26 periods in a year (or 27 periods once every 11 years)
All cheque dates fall within the year 2021
If a cheque date falls within the year 2020 or 2022, the pay period will be treated as part of that tax year instead of 2021.
Statutory holidays
If a payment date falls on a statutory holiday, Humi will automatically set the pay period's cheque date to the closest business day before the holiday.
If you discover any inconsistencies with the 2021 pay period dates or would like to customize one or more of the pay period dates, please reach out to support@humi.ca.
This summary is only available to employers who have claimed the TWS through Humi Payroll. If you did not claim it through Humi Payroll, feel free to skip this section.
In March 2020, as part of the nationwide financial aid package, the Canadian Government released the 10% Temporary Wage Subsidy for eligible employers. Generally, the claimable TWS is based on the total eligible remunerations paid between March 18 to June 19, 2020.
Download the existing Covid Wage Subsidy Report
If you have claimed TWS through Humi in 2020, you will be able to locate the Covid Wage Subsidy Report in the Reporting module. It is important to first download the report to get a detailed breakdown of all the subsidy claims that Humi has made on your behalf.
To help our customers maximize claims from this program and to receive their claims as soon as possible, subsidies were generally processed in two ways:
- Conservative – during the policy's effective period based on the gross remunerations paid at the time, and
- Aggressive – retroactively throughout subsequent payrolls to maximize the possible claim amount up to the company-level cap of $25,000, or employee-level cap of $1,375 per eligible employee.
Review the TWS summary
In addition to the in-app report, we're now providing a subsidy claim summary at year-end to help you determine any over- or under-claimed amounts.
This summary provides information about the total number of claims made within the TWS policy's effective period, retroactively after the period, and overall in 2020, as well as maximum claimable amounts versus actual amounts claimed.
Overall claim amount: this is the sum of all subsidy claim amounts you've made in 2020, according to our records.
Finalized cap: this is the maximum amount of TWS claimable by an employer, which is the lesser of:
- Company cap - up to $25,000 per employer or
- Employee cap - up to $1,375 per employee, multiplied by the number of eligible employees or
- Pay cap - up to 10% of gross remunerations paid during the policy's effective period
Over or under-claimed amount (+/-): this is calculated by subtracting the finalized cap from the overall claim amount. A positive amount means you have over-claimed, and a negative amount means you have under-claimed.
Reconcile over or under-claimed amounts
If you have over-claimed TWS in 2020, it's recommended that you make the remittance for the owed amount to the CRA before the final due date, which is based on your remittance schedule for the 2020 tax year. Humi's support team can also facilitate this remittance. Please contact support@humi.ca with your TWS summary attached.
If you have under-claimed TWS in 2020, you may request that the CRA pay the applicable eligible TWS amount to you or transfer the amount to the next year’s account balance. This can be specified in the TWS Self-Identification Form for Employers.
Report eligible TWS through Self-Identification Form for Employers (PD27)
You may report your eligible TWS in one of the two formats:
- Complete and submit the PD27 web form through My Business Account.
- Complete a downloadable copy of Form PD27 then submit online using “Submit documents” in My Business Account, or submit by mail or by fax to the CRA.
If you have made retroactive claims in 2020, it's recommended that you complete the downloadable copy of Form PD27 to take advantage of the additional fields in Section D of the form. You can copy this information directly from Humi's Covid Wage Subsidy report.
If there are any over- or under-claimed amounts, it's recommended that you record the details in the "Additional Comments" section of the form. For example, specify that you have made the additional remittance to the CRA for the over-claimed amounts, or request that the CRA pay you the under-claimed amounts at year-end.
For more information about TWS please refer to the CRA's TWS guideline for employers or reach out to support@humi.ca.
This is a beta feature that's only available to select employers. If you did not receive it, feel free to skip this section.
Each year, the CRA reviews the T4 slips and T4 Summaries filed by employers to make sure the pensionable and insurable earnings reported would correspond to the deductions that are withheld and remitted. If there is a difference between the CPP contributions or EI premiums required and those you reported, the CRA will provide a PIER listing showing the names of the affected employees and any balance due.
For every pay period, Humi Payroll automatically calculates the obligated amounts for statutory deductions based on each employee's pay. However, it's best practice that employers also perform a self-directed review of all payroll records periodically to ensure they pass the PIER or at the very least keep potential discrepancies at the minimum.
The PIER Summary is designed to help you quickly identify any potential discrepancies in Employee EI, Employee CPP, Employer EI, and Employer CPP remitted.
Important things to review:
CPP variance & EI variance: these amounts represent any discrepancies in the employee CPP and employee EI amounts remitted, versus the statutorily required amounts.
ER CPP variance & ER EI variance: these amounts represent any discrepancies in the employer CPP and employer EI amounts remitted, versus the statutorily required amounts. If you notice discrepancies here, it is likely due to incorrect or missing YTD amounts uploaded to Humi Payroll during onboarding.
If that is the case, closer to year-end Humi will be releasing a feature for you to retroactively update the YTD employer CPP and employer EI amounts.
Reconcile discrepancies
Having a non-zero amount in any of the variance values means a discrepancy is present. A positive discrepancy means overage (ie. over-remitted amount), and a negative discrepancy means deficiency (ie. under-remitted amount).
For overages, no additional actions are required. The CRA will return the over-remitted amounts to the employee as tax refunds later on.
For deficiencies, first, note that sometimes it's normal to have minor deficiencies if there are outstanding payrolls for the current tax year. If the last payroll(s) for the year have not been processed, verify whether the discrepancies will be covered by the last payroll(s) when they are processed.
If the final payroll(s) are processed and discrepancies still persist, it's recommended that you review the payroll records as soon as possible, and make a remittance of the owed amount to the CRA. Learn more about reconciling payroll discrepancies.
The purpose of the summaries is to help reveal basic errors in implementation or usage in Humi Payroll. They are not designed to replace the employer's review of payroll records. Humi does not guarantee all discrepancies are captured in the Payroll Review Summaries.