(CAN) Understanding Common Paymaster for Canada
When an employee changes companies that share Business Identification Numbers (BIN), companies can track taxes and accumulations for EI (Employment Insurance), CPP (Canada Pension Plan), and QPP (Québec Pension Plan) tax types so that they pay only appropriate taxes and statutory limits do not start over.
You can set up common paymaster for Canadian companies using either of these approaches:
Companies share the same tax ID for each allowable tax type.
Companies with different tax IDs use a paymaster group code (UDC 06/PM).
To share the same tax ID (BIN Number), you need to:
Enter appropriate settings on the Corporate Tax ID Revisions form.
Enter an EI rate code for each employee on the Canadian Tax Info by EE form that is consistent with the work tax area.
To share the same tax ID (BIN Number), set up only tax type CD for each work tax area. You can share a BIN number for up to 10 work tax areas. The system uses only the first nine digits of the BIN number to establish a match for the company and carry wages forward.
Set up work tax areas, as needed, using work tax area codes CFEDU01 through CFEDU10.
Tax types for CPP limits are:
CB: Canadian pension plan (employee portion).
CE: Canadian pension plan (employer portion).
Required tax types for EI limits are:
CC: Canadian employee insurance (employee portion).
CD: Canadian employee insurance (employer portion).
Required tax types for QPP limits are:
CG: Quebec provincial plan (employee portion).
CH: Quebec provincial plan (employer portion)
To set up common paymaster using the CP (common paymaster) and PM GR (paymaster group) fields, set the CM field to Y and assign the PM GR field to a value that you set up in UDC 06/PM such as 01 for each work tax area and tax type.