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					Deductions
             Gross Income
• Amount of money you earn before any
  deductions
             Taxable Income
• Taxes are not paid on Union Dues, RRSPs and
  Pension Plans

• Taxable income is Gross Income minus Union
  dues, and RRSP/Pension contributions.

• This is the money you pay taxes on
            EI, CPP and Taxes
• Employment Insurance, Canada Pension Fund,
  and Federal and Provincial Taxes are deducted
  from taxable income

• The amount deducted depends on the
  amount of taxable income
                   EI, CPP
• Employment Insurance and Canada Pension
  Plan, are deducted from taxable income

• The amount deducted depends on the
  amount of taxable income, use tables to
  determine exactly how much
                    Taxes
• Federal and Provincial Taxes are deducted
  from taxable income.
• The amount of Tax you pay depends on your
  taxable income, use tables to determine
  exactly how much
• The claim code affects how much tax you pay.
  This is determined when you fill out your T1
  (first thing you do at any job). Most people
  are category 1.
                        Practice
• Jill grossed $356.54 last week
  – How much did she have to pay in EI, CPP, Federal
    Tax and Provincial Tax (Use claim code 1)?
     •   EI: $6.35
     •   CPP: $14.32
     •   Federal Tax:$17.00
     •   Provincial Tax: $0
                         Practice
• Jody grossed $1223.26 last week
  – How much did she have to pay in EI, CPP, Federal
    Tax and Provincial Tax (Use claim code 1)?
     •   EI: $21.77
     •   CPP:$59.26
     •   Federal Tax:$171.45
     •   Provincial Tax:$62.20
                     Biweekly Pay
• John earned $1024.50 in two weeks.
  – How much did he have to pay in EI, CPP, Federal
    Tax and Provincial Tax (Use claim code 1)?
     • His weekly pay is $512.25
        –   EI: $9.12 weekly so $18.24
        –   CPP: $22.03 weekly so $44.06
        –   Federal Tax:$38.85 weekly so $77.70
        –   Provincial Tax:$11.60 weekly so $23.20
           Semi-Monthly Pay
• Fred gets paid two times a month. If he earns
  $2034.53 in one pay period, what is his weekly
  taxable income?

• Fred is paid twice a month, so 24 times a year
• If he earned the same each pay period he
  would earn $2034.53 x 24 = $48828.72 a year
           Semi-Monthly Pay
• If Fred were paid every week he would be paid
  48828.72 ÷ 52 = $939.01 per week
• We can use this rate to determine how tax to
  take off
• Fred’s weekly CPP contribution is $42.90 to
  determine how much to take off his check
  multiply by 52 to determine how much to take
  off in year, and divide by 24 (because Fred is
  paid Semi-Monthly)
           Semi-Monthly Pay
• 42.90 x 52 = $2230.80 per year
• 2230.80 ÷ 24 = $92.95 semi-monthly
                   Practice
• John is paid semi-monthly. He grosses $893.24 in
  one pay period. What is his EI deduction?

• 893.24 x 24 = 21347.76 (annual pay)
• 21347.76 ÷ 52 = 412.26 (weekly pay)
Weekly EI deduction = $7.34
7.34 x 52 = 381.68 (annual deduction)
381.68 ÷ 24 = $15.90 (semi-monthly deduction)

				
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