Create a Legal Entity Calculation Card

This topic demonstrates how you can create a calculation card at the legal entity level. The calculation card captures information like the tax calculation rules and methods for the organization at the legislative level.

Use the Manage Legal Entity Deduction records task to create the card. Define one Calculation Card for each PSU and TRU you have defined.

You can override the information you define on the legal entity card at the TRU-level.

Perform these tasks to create a legal entity calculation card for Canada:

• Create the Calculation Card

• Define the Federal Tax Calculation Components

• Define the Canada Pension Plan Calculation Components

• Define the Employment Insurance Calculation Components

• Define the Provincial Tax Calculation Components

• Define the Quebec Pension Plan Calculation Components

• Define the Quebec Parental Insurance Plan Calculation Components

How to Create the Calculation Card

1. In the Setup and Maintenance work area, do the following:

   • Offering: Workforce Deployment

   • Functional Area: Enterprise Structures

   • Task: Define Legal Entities for Human Capital Management

   Expand the entry to display a list of related tasks.

2. Click the Select Scope link for the Define Legal Entities for Human Capital Management task.

3. On the Select Scope window, select Select and Add.

4. Click Apply and Go to Task.

5. On the Select and Add: Legal Entity page, search for and select the legal entity and click Save and Close.

6. Click Go to Task for the Manage Legal Entity Calculation Cards task.

7. Click Create.

8. Enter the Effective-As-of-date and select Calculation Rules for Tax Reporting and Payroll Statutory Unit as the card name.

9. Click Continue.

How to Define the Federal Tax Calculation Components

The Federal Tax card component is used to capture information that impacts Federal Tax calculations for employees.

1. Select Federal from the Components Groups in the Calculation Card Overview section.

2. Select Federal Tax as the Calculation Component.

3. Select Edit-Correct in the Federal Tax: Details section.

4. In the Calculation Component Details tab:

   • Select Option 1- General Tax Formula in the Federal Regular Tax Method

   • Select one of these options in the Federal Nonperiodic Tax Method to configure the nonperiodic tax method:

     • Regular Bonus Calculation

     • Year-to-Date Bonus Calculation

5. Click Save.

How to Define the Canada Pension Plan Calculation Components

The Canada Pension Plan card component is used to capture information that impacts CPP calculations for employees.

1. Select Canada Pension Plan as the Calculation Component.

2. Select Edit-Correct in the Canada Pension Plan: Details section.

3. In the Calculation Component Details tab, select one of these self-adjust options for the CPP Self Adjust Method:

   • Self Adjust - adjusts the deduction based on the pensionable earnings every payroll

   • Self Adjust at Maximum - adjusts the deduction based on the pensionable earnings when the maximum annual pensionable earnings are reached

4. Click Save.

How to Define the Employment Insurance Calculation Components

The Employment Insurance card component is used to capture information that impacts EI calculations for employees.

1. Select Employment Insurance as the Calculation Component.

2. Select Edit-Correct in the Employment Insurance: Details section.

3. In the Calculation Component Details tab, select one of these self-adjust options for the EI Self-Adjust Method:

   • Self-Adjust - adjusts the deduction based on the insurable earnings every payroll

   • Self-Adjust at Maximum - adjusts the deduction based on the insurable earnings when the maximum annual insurable earnings are reached

4. In the Enterable Calculation Values on Calculation Cards tab:

   • Click Plus.

   • Select Employer EI Rate in the Name field and click OK.

   • Enter the rate value. Enter the rate to three decimals (for example 1.267).

   • Click OK.

5. Click Save and Close.

How to Define the Provincial Tax Calculation Components

The Provincial Tax card component is used to capture information that impacts Provincial Tax calculations for employees. This component is only applicable to Quebec.

1. Select Regional from the Component Groups in the Calculation Card Overview section.

2. Click QC (or Quebec) under Regional.

3. Select Provincial Tax as the Calculation Component.

4. Click Plus in the Provincial Tax: Details section.

5. Select Provincial Tax in the Calculation Component Details field and click OK.

   • Select Regular Payments as the Provincial Regular Tax Method.

   • Select Bonus, Retroactive Pay or Lump Sum Payments - Method 1 as the Provincial Nonperiodic Tax Method.

6. Click Save.

How to Define the Quebec Pension Plan Calculation Components

The Quebec Pension Plan card component is used to capture information that impacts QPP calculations for employees. This component is only applicable to Quebec.

1. Select Quebec Pension Plan as the Calculation Component.

2. Click Plus in the Quebec Pension Plan: Details section.

3. Select Quebec Pension Plan in the Calculation Component Details field and click OK.

4. In the Calculation Component Details tab, select one of these self-adjust options for the QPP Self-Adjust Method:

   • Self-Adjust - adjusts the deduction based on the pensionable earnings every payroll

   • Self-Adjust at Maximum - adjusts the deduction based on the pensionable earnings when the maximum annual pensionable earnings are reached

5. Click Save.

How to Define the Quebec Parental Insurance Plan Calculation Components

The Quebec Parental Insurance Plan card component is used to capture information that impacts QPIP calculations for employees.

1. Select Quebec Parental Insurance Plan as the Calculation Component.

2. Click Plus in the Quebec Parental Insurance Plan: Details section.

3. Select Quebec Parental Insurance Plan in the Calculation Component Details field and click OK.

4. In the Calculation Component Details tab, select one of these self-adjust options for the QPIP Self-Adjust Method:

   • Self-Adjust - adjusts the deduction based on the insurable earnings every payroll

   • Self-Adjust at Maximum - adjusts the deduction based on the insurable earnings when the maximum annual insurable earnings are reached

5. Click Save and Close.