Changes to Canadian Payroll for Dynamics GP

The year end tax update for Dynamics GP hasn’t been released yet, but this article covers what we know at this time. We will continue to update this blog as more information becomes available.

Information from Microsoft about the 2023 Canadian Payroll Year-End Update for Dynamics GP includes the following changes:

  • ROE Serial Numbers Can Now Start with M
  • Additional CPP and QPP Contributions
  • Reporting Benefits on extra boxes of the T4 form
  • Tables changes for the Canadian Year End

The target release for this update is Dec. 22, 2023.

The T4127 was released and you can find it here: T4127 Payroll Deductions Formulas.

Table, Column, and Parameter Changes

In the Dynamics GP October 2023 release there were table, column, and parameter changes that impact Canadian Payroll due to changes in CPP as well as the addition of a new reporting requirement Box 45 – Dental Benefits. More information about the table changes can be found in this article from Microsoft.

Box 45 – Dental Benefit

A Box 45 requirement has been added for the 2023 T4, and T4A. This will also affect the R1 but is not reflected in this article. With the new expansion of the Federal Dental Care Program, your T4 tax forms will identify if you qualify for this benefit.

“The government plans to require all employers to report on whether their staff have benefits as part of their T4 tax forms, to prevent anyone with existing insurance from being able to access the new federal plan.” (Global News, March 28, 2023)

This will be reflected on the actual T4. It will populate the Other information section with Box 45 (or Box 15) and the selection of 1 to 5 that has been made. It will, also, be reflected in your XML file uploaded to the CRA.

  1. No dental insurance or coverage of any kind
  2. Payee
  3. Payee, spouse, and dependent children
  4. Payee and their spouse
  5. Payee and their dependent children

When the tax update is installed, it will default to 1 (No detail insurance or coverage of any kind).

Employer Offered Dental Benefits Field

This field has been added to the following windows:

1. The TD1 Value window, both this year and last year.

Screenshot of the TD1 Value window highlighting the Employer Offered Dental Benfits field.

2. The T4 (and T4A) Edit window.

Screenshot of the T4 (and T4A) Edit window, highlighting row 16A. "CPP Deducted" and row 45. "Employee Offered Dental Benefits"

How To Update This Field

To update this field after the update has been installed:

1. Run a script to change this in the CPY10100 tables.

UPDATE CPY10100 set pempofferdental = ‘#’ WHERE PEmployeeID = ‘XXXX’

  • Where # = your benefit selection and XXXX = the Employee ID.

Note: Must be done before the Year End File Reset

2. Update the Employee Card.

From the Employee Card go to TD1 Values. Note the new field “Employer Offered Dental Benefits”, make your selection.

Note: This must be done before the Year End File Reset.

3. Update Box 45 on the T4 (or Box 15 T4A) Edit window.

Go to Routines > T4 edit (Or T4A Routines > T4A Record Edit)

Note: Must be done after the Year End File Reset.

4. Update the Employee’s Last Year information.

From the TD1 Values, change Box 45 on the T4 (or Box 15 T4A) and change the T4 (or T4A) information.

Note: Must be done after the Year End File Reset.

Remember this is done after the Year End Close procedure and you will need to recreate the T4s.

Box 16A – Additional CPP

Each year there is a YMPE (Yearly Maximum Pensionable Earnings) set. This amount is reduced by a $3,500 annual exemption and then CPP is calculated at the current rate of 5.95%. This amount will continue to be shown in Box 16.

In 2024, there will be a second amount YAMPE (Yearly Additional Maximum Pensionable Earnings). The amount between the ceiling YMPE and the second ceiling YAMPE will be calculated at the new rate. The rate is 4%, and this amount will be recorded in Box 16A.

This will also affect R1s. Quebec residents, please visit Revenue Quebec’s website for more information on the new enhanced QPP and what your obligations are as an employee or employer.

New Field on Employee T4 – Box 16A (CPP2) Deductions

There is no change for CPP (QPP) for the 2023 T4s. However, these new calculations will begin in the first payroll of 2024.

You will see a new field on the Employee T4 window that includes Box 16A (CPP2) deductions.

You will also see this field in Last Year’s T4 Edit windows, but it will be zero and will not be reflected on the T4 or XML this year.

Screenshot of the T4 (and T4A) Edit window, highlighting row 16A. "CPP Deducted" and row 45. "Employee Offered Dental Benefits"

Enhanced CPP/QPP and How This Works

Note: This example does not include rates for Quebec.

2024 expects to see the first ceiling, YMPE, set at $69,000. The second ceiling, YAMPE, is calculated at [YMPE * 7% + YMPE] for 2024, and [14% * YMPE + YMPE] for subsequent years.

Example

  • An employee earns $100,000.
  • If in 2024 the YMPE is set at $69,000 and YAMPE is set at $73,830 (7% * $69,000 + $69,000).

Contribution Calculations

Box 16 – First CPP contribution is calculated as always: ($69,000 – $3,500) * 5.95% = $65,000 * 5.95% = $3,897.25.

Box 16A – The additional CPP amount: ($73,830 – $69,000) * 4% = $4,830 * 4% = $193.20.

Because this employee has earned more than the second ceiling (YAMPE), this employee pays the maximum amount of $4,090.45.

Employer Portion

The employer portion will continue to match the employee contribution. In this example the employer will contribute $4,090.45.

Note: This will also affect R1s and R1As. The calculations will be the same with updated rates from Revenue Quebec. Please visit the Revenue Quebec’s website for more information on the new enhanced QPP rates and what your obligations are as an employee or employer.

How to Fix the Typo in the XML File to Upload to the CRA

When producing your XML file to upload to the CRA, it has a typo in it.

You can install a new patch to fix it or you can do the following:

Open up the XML file in Notepad and choose the Edit option. Find and replace to fix the file, then it will upload fine.

The file is created with this tag below:
<empr_dntl_ben_rep_cd >#</empr_dntl_ben_rep_cd>

and it should be:
<empr_dntl_ben_rpt_cd >#</empr_dntl_ben_rpt_cd>

This has to be done in two steps:

  1. Replace <empr_dntl_ben_rep_cd > with <empr_dntl_ben_rpt_cd >
  2. Replace </empr_dntl_ben_rep_cd> with </empr_dntl_ben_rpt_cd>

There may be a second item flagged as wrong, that the tag was in the wrong spot, but once you replace these, it will upload fine.

Doing Tax Updates

If you are doing your own Tax update, please see our 2023 Year End Payroll Procedures document, for updating tax credit amounts and running T4s.

If you require assistance with your Tax Update, please contact Encore as soon as possible.

If you have any questions about Canadian Payroll in Dynamics GP, feel free to get in touch with us.

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