Processing Sales Tax

Some specific benefits have sales tax calculations performed on them if you have configured them as such to process sales tax. Sales tax calculations apply to these element classifications:

Taxable benefits
Employer liabilities
Voluntary deductions

These sections describe the factors that influence sales tax calculations.

Sales Tax Calculations

This table shows the calculated sales tax and whether they belong to Federal or Provincial calculations.

Level	Sales Tax
Federal and Provincial	Harmonized Sales Tax (HST) A combination of Goods and Services Tax (GST) and Provincial Sales Tax (PST).
Federal	GST
Provincial	Provincial Premium Tax (PPT) PST and Quebec Sales Tax Retail Sales Tax (RST) on Insurance

Level

Sales Tax

Federal and Provincial

Harmonized Sales Tax (HST)

A combination of Goods and Services Tax (GST) and Provincial Sales Tax (PST).

Federal

GST

Provincial

Provincial Premium Tax (PPT)
PST and Quebec Sales Tax
Retail Sales Tax (RST) on Insurance

Configure Elements for Sales Tax Calculations

The element template contains questions if sales tax applies to the element created. The default answer for each sales tax is No. The sales tax types that apply are:

Your answer to the template question 'Should the tax be reported separately?', determine how the sales tax amounts are displayed on the Statement of Earnings and the employee's payslip, as given below:

If Yes, then the individual sales tax amounts are reported as separate line items on the Statement of Earnings and the employee's payslip.
If No, then the values for each sales tax for that element are combined with the element's base amount, and reported as one line item.

The default for the Report Sales Tax Separately option is Yes.

The following new input values exist on the base element related to sales tax:

GST
HST
PPT
PST
RST
Report Sales Tax Separately

Additionally, the application creates shadow elements for the main elements and the retroactive elements you create, to process sales tax. The shadow elements are:

<Base Element Name> Sales Tax Calculator
<Base Element Name> GST
<Base Element Name> HST
<Base Element Name> PPT
<Base Element Name> PST
<Base Element Name> RST Result

Balances

These are the balance types for the individual tax amounts:

<element name> GST
<element name> HST
<element name> PPT
<element name> PST
<element name> RST

Retail Sales Tax Calculations

The Retail Sales Tax on Insurance tax calculation considers the province of employment on the tax card, as well as the province of residence of the employee. If you configure both PPT and Retail Sales Tax for an element, the Retail Sales Tax calculates on the base amount plus the PPT.

The details of the sales tax calculations for Retail Sales Tax and exceptions if the province of employment is in Ontario, Quebec, or Saskatchewan are given below for the province of Manitoba. Employer-paid premiums relate to taxable benefits and employer liability elements, while employee-paid premiums relate only to voluntary deduction elements.

Province of Residence	Province of Employment	Employer-Paid Premiums	Employee-Paid Premiums
Manitoba	Manitoba	Subject to Manitoba Tax	Subject to Manitoba Tax
Outside Manitoba	Manitoba	Exempt from Manitoba Tax	Exempt from Manitoba Tax
Manitoba	Outside Manitoba	Subject to Manitoba Tax	Subject to Manitoba Tax
Outside Manitoba	Outside Manitoba	Exempt from Manitoba Tax	Exempt from Manitoba Tax
Manitoba	Ontario	Exempt from Manitoba Tax	Subject to Manitoba Tax
Manitoba	Quebec	Exempt from Manitoba Tax Subject to Quebec Tax	Subject to Manitoba Tax
Manitoba	Saskatchewan	Exempt from Manitoba Tax Subject to Saskatchewan Tax	Subject to Manitoba Tax
Ontario	Ontario	Subject to Ontario Tax	Subject to Ontario Tax
Outside Ontario	Ontario	Subject to Ontario Tax	Exempt from Ontario Tax
Ontario	Outside Ontario	Exempt from Ontario Tax	Exempt from Ontario Tax
Outside Ontario	Outside Ontario	Exempt from Ontario Tax	Exempt from Ontario Tax
Quebec	Quebec	Subject to Quebec Tax	Subject to Quebec Tax
Outside Quebec	Quebec	Subject to Quebec Tax	Exempt from Quebec Tax
Quebec	Outside Quebec	Exempt from Quebec Tax	Subject to Quebec Tax
Outside Quebec	Outside Quebec	Exempt from Quebec Tax	Exempt from Quebec Tax

Workers' Compensation and Provincial Medical Liability

For taxable benefits, the workers' compensation and provincial medical calculations are processed on the combination of the taxable benefit and sales tax amounts, if applicable.