Income tax is not being deducted from employees payroll

Hi kandtmason-gmail,

Welcome to Community!  QuickBooks Online Payroll is a great way to pay your staff with confidence.  It's important that the deductions are applied for accurate calculations and keeping in good standing with government guidelines.  I'll be happy to provide more information so you're on the right track with your work!

To ensure the deductions are applied to your employees, I suggest reviewing the initial set up.  Here's how;

1. Open Payroll and then Employees from the left menu

2. Select the Employee and then Edit employee

3. Open the section What are [employee name] tax withholdings? 

4. Click on the Edit ✎ for the TD1 form

5. Scroll to the bottom and open Tax exemptions to see Which taxes does [employee name] NOT pay?

6. Uncheck the appropriate boxes for the Canada Pension Plan (CPP), Employment Insurance (EI) and Federal Income Tax

7. Hit Done to save the changes

Should you require additional assistance, please don't hesitate to contact us.

Feel free to reach back out if you have other questions.  We'd be glad to assist!