How do I stop the system from deducting income tax based on the information completed on an employee's TD1?

Hello, 

Income tax is collected based on your income. Most of the money you earn is subject to income tax, which is why there's no direct feature in QuickBooks Online allowing you to remove it entirely from the system.  

If you're trying to stop the system from deducting income tax on an employees pay cheque, this will have to be something you manually edit during each pay run. To do this, click the Run Payroll option, and select Preview Payroll. Click the small Pencil icon next to the employee you're removing income tax for. Expand the drop-down next to Employee Taxes, and change the Income Tax amount to $0.00. Click OK, then Submit Payroll. 

Let me know if you have any other questions for me. I've got your back! 

Have a great day.