Taxable, Payable Benefits

Question

I am trying to create a taxable mileage benefit for our employees, however, when I use the income type "Benefit" and enter mileage for payment on an employee's payment, it behaves as a non-receivable benefit. How do I change the set up so that Sage will physically pay the benefit out to the employee with their earnings?

Erzsi_I · Answer

Hi Gillybean , 
 Thanks for reaching out. It looks like you&rsquo;re trying to set up a taxable mileage benefit that should be paid out with employee earnings. For this, you'll want to ensure the income type is set up correctly in Sage to be both taxable and payable. 
 Here are some steps to review: 
 
 Set up a new income under Setup, Settings, Payroll, Incomes . 
 Ensure the income type is set to Income and not Reimbursement as reimbursements are non-taxable and non-payable benefits. 
 Under Linked Accounts, Incomes , select the appropriate expense account. 
 Check the tax deduction settings for this income to make sure it&rsquo;s set up as a taxable benefit. You can refer to the benefits and allowances chart provided by the CRA to see how different benefits are taxed. 
 If necessary, set the &lsquo;Calculate Vacation&rsquo; based on whether the allowance should be vacationable. 
 Enable the income on the employee's record. 
 
 When you create the paycheque, the allowance should show up on the earnings side of the paycheque module. 
 If you've already set this up but are encountering issues when recalling the paycheque for adjustments, you may need to use the workaround steps provided to view and adjust the customised income types. This involves looking up the paycheque, voiding it, and recreating it with the correct amounts. 
 For detailed guidance, you might want to check out the full articles on the Sage Knowledgebase: 
 
 How to create an employee allowance or different kind of reimbursement 
 When I consult or adjust a paycheque, the customized Benefits, Benefits Qc or Reimbursement do not appear on the screen 
 
 If this helps, please mark it as verified :) 
 Warm Regards, Erzsi

Sage 50 Canada

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