The income tax calculations are very complex and precise. When Sage programs the calculations they become very exact. If you are comparing the results to the tax tables the tables are not as exact as they work in ranges of income. If you compare to the Payroll Deductions Online Calculator the difference is almost negligible. I don't know the source of your model but if the difference is very close I would not be too concerned.

Hi Alwyn

I noticed that calculation of federal taxe is OK  for people over 18 years old, when QPP is also calculated . Calculation of federal tax is not right by few dollars (not cents) when employee is under 18 years old.

Any idea why?

Regards,

Danielle

Hi Danielle: I don't know the full formula for calculating income taxes, however, based on your comment I am wondering if the formula is different if CPP or QPP are not included in payroll. This might be the case for those under 18 or over 70. Many years ago I do remember that when CPP dropped off at age 65 it made a difference in the taxes but since then many changes have been made to the tax formula. There might be someone at Sage who could comment on this (Erzi_I) or it might be a question for CRA or a tax accountant.

Danielle and Alwyn

When you run the PDOC calculations for someone who is not CPP exempt and then go back and only change the CPP to Exempt, the tax amount calculates differently.  It has done it this way for years.

Thanks! I never noticed!