Payroll Fundamentals 1 Study guide questions and answers

RQ and CRA define a car allowance as reasonable if: - - The allowance is based solely on business kilometres driven in a calendar year - the amount provided is based on the following government-prescribed reasonable guidelines - $0.58 per km for the first 5,000 business km's in the year ($0,62 in the Yukon, NWT & Nunavut) - $0.51 thereafter ($0.56 for YK, NWT, NT) - the employer does not reimburse the employee for expenses related to the same use of the vehicle Personal Driving includes: - - vacation travel - driving to conduct personal business - travel between home and work, even if the employer insists the employee drive the vehicle home Business driving includes: - - driving to existing and prospective clients, points of call, and other office locations of the employer - when an employee travels directly from home to a point of call, which is not the employer's place of business where the employee regularly reports for work - when the employees travels home directly from a point of call Availability (automobiles) - The number of thirty-day periods that the automobile is available to the employee for the current taxation year. The employee has access to or control over the vehicle. Automobile - A motor vehicle that is designed or adapted to primarily carry individuals on highways and streets, and has seating capacity of not more than the driver and eight passengers If a gift or award is given to an employee in cash - The amount is considered pensionable, insurable and taxable to the employee, subject to all statutory deductions Overtime meal allowance is considered non-taxable if (RQ): - - overtime is done at the employer's request and is expected to last for at least two consecutive hours - overtime is done rarely or on an occasional basis - the meal expenses are reimbursed upon presentation of receipts - the meal expenses reimbursed or the value of the meal provided is reasonable The four categories of employment income - - Earnings - Allowances - Benefits - Taxable expense reimbursement Earnings - Dollar amounts the employer pays an employee for the work they perform Types of earnings - - a salary - a rate for each hour worked - a rate per piece of goods produced or picked - a disability payment for time off work due to illness - a payment for vacation time - a premium payment for overtime hours worked - a premium payment for hours worked on shift Allowances - Additional dollar amounts paid to employees for the use, or anticipated use, of their personal property for business purposes Benefits - Dollar values attributed to something the employer has either provided to an employee or paid for on an employee's behalf Expense Reimbursements - Dollar amounts paid to employees to cover expenses that they incur while performing their job.