How to set up a Registered Pension Plan so that the Employee and Employer portions are reported in Box 52 on the T4 and Box 20 still only displays the Employee's portion.
The users would like the following displayed on the T4:
- T4 Box 20 = $ 9.90
- T4 Box 52 = $ 21.45 (Both the Employee's and Employer's portion: $9.90 + $11.55)
Set up the following codes:
1. Benefit Code (B1): This Benefit code is used to update the T4 box with the Employer's portion.
- Income Tax applicable = Yes
- Enter the Employer's contribution amount in the amount field ($11.55).
- Further ID = N/A
- Assign this benefit code (B1) to the Employee
2. Deduction Code (D1): This is an Offsetting deduction for the Benefit Code (B1), set up in step 1.
- The Further ID = Pension Adjustment
- Before Taxes Deduction = Yes
- The amountwill be the same as the amount in Benefit 1 ($11.55).
- Enter 52 for the T4 Extra box number.
- Link this Deduction code (D1) to Benefit code (B1).
3. Deduction Code (D3): This Deduction code is for the employee's portion of the pension plan.
- The Further ID = Pension
- T4 Primary box = 20
- Income tax applicable = Yes
- Enter the amount of the employee's deduction amount ($9.90).
- Assign this deduction code (D3) to the employee.
4. Benefit Code (B2): This Benefit code will update box 52 of the T4 for the Employee's portion.
- Income Tax applicable = No
- Further reference = N/A
- Enter the amount of the employee's portion ($9.90).
- Assign this Benefit code (B2) to the employee.
5. Deduction Code (D2): This is an Offsetting deduction for the Benefit Code (B2), set up in step 4.
- Before Tax Deduction = Yes
- Further ID = Pension Adjustment
- T4 Extra box = 52
- The amount will be the same as the amount in Benefit 4 ($9.90).
- Link this Deduction code (D2) to Benefit code (B2) set up in step 4.
This article was TechKnowledge Document ID:29859
The setup above will also update Box 14. If you do not need this box updated, you may need to manually edit this back out of Box 14 at year-end time.