Defining EHT deductions

Before you define employer health taxes, define a tax authority for each province. See elsewhere in this user guide for instructions on defining tax authorities. See Defining United States Tax Authorities

  1. Access the Deduction tab of Deduction (PR05.1).
  2. Specify this information:
    Calculation Type

    Select Tax.

    Currency

    Select Canadian Dollars.

    Adjust Pay

    Select Company Paid.

  3. Complete the remainder of the fields following the instructions
  4. In the Taxes tab, specify this information:
    Country Code

    Select Canada.

    Tax Category

    Select Health Tax

    Tax Authority

    Select the authority you defined on Canada Tax Authority (PR08.1).

  5. Access EHT Exemptions (PR05.5) to enter employer health tax exemption amounts. Use these guidelines:
    Note: Exemptions should only be entered for a process level or report entity that has an associated EHT account number. If exemption amounts or percents are not entered, the tax engine uses the default exemption amount for the applicable tax authority.
    Report Entity

    Type the report entity for which the exemption applies. If the exemption applies to the report entity company, leave this field blank. If the exemption applies to a report entity process level, enter the independent process level.

    Process Level

    Type the process level for which the exemption applies. If the exemption applies to all wages earned in the report entity, leave this field blank. If the exemption applies only to wages earned in a particular process level, enter that process level here.

    Year

    Select the year for the exemptions.

    Exemption Ind

    Select whether the employer is eligible for the exemption amount for this health tax.

    If you select Single Employer, Multiple Employer, or Associated Employer, the tax engine uses the exemption amount or the exemption percent times the tax authorities default percent to calculate the exemption amount.

    If the exemption amount does not apply, select Non Eligible.

    If you leave this field blank for a process level, the report entity amount or percent will be used. If the report entity's amount or percent is blank, the tax authority's default exemption amount will be used.

    Exemption Amount or Percent

    Type the exemption amount or percent that applies for the employer health tax. This amount overrides the tax authority's default exemption amount for the tax year.

    If you leave this field blank for a process level, the report entity amount or percent will be used. If the report entity's amount or percent is blank, the tax authority's default exemption amount will be used.

    YTD Wages

    The year-to-date wages updated by Payroll Close (PR197) display. The year-to-date wages less the exemption amount will correspond to the wages that have been taxed for employer health tax (EHT) purposes.

    Although you can update this field, this should do this ONLY at conversion.