A Primer on Payroll in Canada Manual tax calculation Payroll Deductions Formula (T4127) Payroll Deductions Online Calculator (PDOC) PDOC performs all of the calculations for commissioned employees behind the scenes. When using PDOC employers are asked to input the total annual remuneration, total annual expenses, and federal and provincial TD1 form amounts, along with the current amount being paid. Once the data is entered, the federal and provincial tax percentages appear on the screen, along with the federal and provincial tax deductions to withhold. Alternatively, you can perform the manual calculation of income taxes for commission remunerated employees following the step-by-step example provided in the guide Payroll Deduction Tables for the individual province/territory. TP-1015.R.13.1-V-STATEMENT OF COMMISSIONS AND EXPENSES FOR SOURCE DEDUCTIONS PURPOSES Quebec employees who incur expenses while earning a commission may elect to complete form TP-1015.R.13.1-V. This form establishes the percentage of commissions that must be included in income when calculating the employee's Quebec tax liability. Once the percentage of commissions to be included in income is determined the percentage figure is used on all commission payments which are added to total salary and regular tax tables are used (provincially). The form asks the employee to report the actual commissions for the previous year or an estimate of the current year along with the net eligible expenses. A formula, outlined on the form, is then used to determine the percentage of commissions to be included when determining Quebec tax liability. NOTE: Quebec employees must complete a TD1X for federal tax and a TP-1015.R.13.1-V for Quebec provincial tax. © The Canadian Payroll Association/L'Association canadienne de la paie 2020 11-73