Chapter11 - C H A P T E R 11 Payroll Liabilities Guilty...

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11 Guilty Tracadie–Sheila, March 18, 2003—A Tracadie–Sheila man was fned $4,000 in provincial court regarding Four charges oF Failing to remit tax deducted From employees’ paycheques. Edmundston, January 14, 2003—CCRA announced that a dentist was fned $3,000 in Edmundston provincial court aFter pleading guilty to three charges oF Failing to remit over $8,000 in monies deducted and withheld From wages and salaries paid to employees. Montreal, May 26, 2003—A director on the board oF two companies was Fined $541,870 and sentenced to a 12- month prison term Following a CCRA investigation that showed payroll deductions From the salaries oF employees were not remitted to the Receiver General For Canada. Quebec, January 16, 2003—The manager oF a company pleaded guilty to charges oF Failing to remit payroll deductions. The company was fned $3,000 and its manager was also fned the same amount. In addition, the company is still required to remit payroll deductions. In all oF the above cases, unpaid deductions must be paid in addition to the fnes. ±ailure to do so will result in imprisonment. CCRA takes nonpayment oF source deductions very seriously, as the amounts deducted From employees are deemed to be held in trust until remitted to CCRA on their behalF. People who deliberately evade taxes Force honest Canadians to pay more than their Fair share. Canadians have to be confdent that the tax system is Fair, and know that CCRA will prosecute those individuals who cheat. Payroll Liabilities CHAPTER
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Learning Objectives LO 1 List the taxes and other items frequently withheld from employees’ wages. LO 2 Make the calculations necessary to prepare a Payroll Register and prepare the entries to record and pay payroll liabilities. LO 3 Calculate the payroll costs levied on employers and prepare the entries to record the accrual and payment of these amounts. LO 4 Calculate and record employee fringe beneFt costs and show the effect of these items on the total cost of employing labour.
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Chapter Preview Wages or salaries generally amount to one of the largest expenses incurred by a business. Accounting for employees’ wages and salaries is one task that is shared by almost all business entities. Payroll accounting: Records cash payments to employees. Provides valuable information regarding labour costs. Accounts for amounts withheld from employees’ pay. Accounts for employee (fringe) beneFts and payroll costs paid by the employer. Provides the means to comply with governmental regulations on employee compensation. As you study this chapter, you will learn the general processes that all businesses follow to account for these items. Items Withheld from Employees’ Wages An understanding of payroll accounting and the design and use of payroll records requires some knowledge of the laws and programs that affect payrolls. Many of these require payroll deductions, amounts withheld from the wages of employ- ees, and are discussed in the Frst portion of this chapter.
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Chapter11 - C H A P T E R 11 Payroll Liabilities Guilty...

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