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mck1
September 9, 2022
Question

Pay Types - direct tips and customizing tax settings

  • September 9, 2022
  • 1 reply
  • 0 views

Hey! 

 

I'm trying to add a custom pay type but I seem unable to edit the details for tax settings for pay types. I want to be able to enter direct tips here but they would need to be non-pensionable, non-insurable, but taxable. They are insurable earnings but not insurable hours so  the controlled tips works but then I am paying tax on top of these which shouldn't be applicable, and the employee is paying EI and CPP on them which also shouldn't be applicable I believe on direct tips. How do I edit the tax settings for a pay type? The screen doesn't seem to allow me to edit those things. I'm using QB online payroll, my main account is accountant version if that's relevant.

 

After events I get clients e-mail me tips for a specific staff member so I need a pay type that can properly put those through without making them a cost to me.

 

Example if this helps:

- customer transferred me $50 after an event for a specific employee

- I went to pay that employee that amount, knowing it needs to be taxed, but none of the pay types allow me to pay it without it costing me money aside from reimbursement but then it misses taxing the employee on it so I can't do that option.

 

Help! 

1 reply

R
Rea_M
September 9, 2022

Hello there, @mck1.

 

Let me share some insights about pay types and why you're unable to edit its settings in QuickBooks Online Payroll (QBOP).

 

There are certain pay types that the QBOP system supports. For the time being, the option to edit the tax settings for a custom pay type is unavailable. You can only select common pay types, set up additional items, and enter their rates or amount. 

 

On the other hand, I encourage you to consult a tax professional or your accountant to help you choose the appropriate pay type for direct tips. This way, your taxes will be calculated correctly, and file the exact amount to the agency.

 

Also, you can run payroll reports to view information about your business finances and employees. You may want to check out this article if you need the complete list of payroll reports and a guide on how you can customize, print, and mark them as favorites in QBOP: Run payroll reports in QuickBooks Online Payroll.

 

Keep me posted if you have other payroll concerns or questions about pay types and managing employees in QBOP. I'll gladly help. Take care, and have a great day, @mck1.

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