Is QB going to fix the way it post payroll to reflect how Revenue Canada relates to payroll. RC go's by Pay Period NOT pay date. The subsidy is calculating by pay day.

Hello @leanne7 ,

I understand your frustration.  However, CRA does not recognize income by pay period, but rather by pay date.  That is why every pay date that occurs in a year is what ends up on the T4.  For example, I am on a bi-weekly payroll.  My first pay date of the year was dated Jan. 3/20, which covered the pay period, Dec 15 - 28/19.  Those wages, although they were technically earned in 2019, are not counted as T4 income for 2019; they are counted as T4 income for 2020.

Payroll remittances are not covering pay periods.  They are covering pay dates.  So any wages you pay between this date and that date, remittances are due on XXX date.  For example, I am a Threshold 1 remitter.  For any paydays that occured between Mar 1 - 15/20, my PR remittance was due Mar 25/20.  For any paydays that occurred between Mar 16 - 31/20, my PR remittance is due Apr 10/20.

From CRA:

Remittance thresholds for employer source deductionsRemitter types AMWA Footnote 1 Due dates

It can create some difficulties as what we generally require for accounting purposes, is at odds with what CRA requires for their purposes, when it comes to payroll.  This is why most of us have to do wage accrual entries for accounting purposes.  This requires an accrual to payroll expenses and wages payable, and a reversal on the first of the following month.

So just to recap and be clear, what you require for accounting purposes is not the same as what CRA requires for reporting payroll and T4 information.  CRA always bases their reporting requirements on date paid, not on end of payroll period.  The only exceptions to this is when you create an ROE; there are some types of income that must be reported on the ROE for earnings in which is paid and for which is paid (speaking about the time period - this is handled within QB so you shouldn't have to worry about it.), but this does not change anything for earnings reporting in general.  

I said all that to establish how CRA views pay periods vs. pay dates.

Similarly, the calculation of the COVID-19 10% Wage Subsidy is "equal to 10% of the remuneration you pay from March 18, 2020 to June 19, 2020, up to $1,375 for each eligible employee to a maximum of $25,000 total per employer."  They don't want to know the exact wages that were earned on and between those dates; they want to know what wages were paid on or between those dates.

Using your example, your pay period is 1st to 15th, paid on the 20th.  This means that the earnings you paid on the 20th qualify for the subsidy, even though the pay period was 1st to 15th.  CRA recognizes that this may be the case, but they will make it up on the other end as you will not be able to claim your June 20th payroll because the end date of this program is Jun 19/20.   They intend that all businesses, no matter whether they are on a weekly, bi-weekly, semi-monthly or monthly payroll or when their wages are paid will be on an even playing ground; all pay dates between Mar 18 and Jun 19 qualify.

From CRA:

When can I start reducing payroll remittances?

You can start reducing payroll remittances of federal, provincial, or territorial income tax in the first remittance period that includes remuneration paid from March 18, 2020 to June 19, 2020.

I hope this makes sense and helps you somewhat.