As we know, the majority of the Governments revenue comes from income tax.

The amount of Income Tax that is deducted is based on the individuals gross pay. The rate is then determined and administered by the Canada Revenue Agency. Employers are responsible for deducting the amount, in addition to this, employers are not responsible to pay or match any deductions. There is no age limit for income tax deductions. So how are the deduction rates determined? Each year the CRA provides employers with deduction tables, from here, based on your gross pay the find your total gross pay in the table, and deduct the amount that corresponds with that gross pay number. For the most part taxes can be raised and lowered depending on what the Government decides to do. It is the Government that sets the rate, not the CRA, they only administer it. To calculate Income Tax Deductions do the following. 1. Identify the number entered on Line 13 of the TD-1 Form. 2. Determine the Claim Code for both Provincial and Federal Income Tax. To determine which Claim Code they use, you look at the total income on box 13 of the TD-1 Form. Then on the claim code chart, find the code that corresponds with that claim amount. 3. Calculate the individuals gross pay. 4. Using the federal deductions chart, find the amount of gross pay in the first column, moving across the page, find the amount that you would deduct in the specific claim code column. 5. Repeat step four but using the Saskatchewan Deduction Tables. 6. Add the two totals together to get the total deduction rate. Example: Jason is an individual who works for 7-Eleven. He has claimed a total amount of 11, 038 on his TD-1 form. He is paid 14.00 an hour and works 40 hours per week. He is paid weekly. Calculate his income tax deduction. 1. Determine the Federal and Provincial Claim Code for Jason. Federal Code 1 Provincial Code 1 2. Calculate his gross pay. 40 x $14.00 -= $560.00 3. Find the federal deduction amount $43.40

4. Find the Provincial Amount $25.30 5. Add the two amounts together. $68.60 The total amount of Income Tax deducted is $68.60

1. Determine the Federal Claim Codes for the amounts below. Put the code in the box beside the number. $ 5000.00 $21581.00 $22692.01 $18235.00 $20000.00 $35500.00 $45251.00 $15241.00 $0.00 $18000.00

2. Determine the Provincial Claim Codes for the amounts below. Put the code in the box beside the number. $15100.00 $26512.00 $32900.00 $13250.00 $14578.65 $28000.00 $30929.99 $21512.00 $24895.63 $19547.25

3. Use the deduction tables provided in class to answer the following questions. a. How much would you deduct if you made $3200.00 monthly and were in claim code 2

b. How much would you deduct if you made$ 1200.00 weekly and were in claim code 3

c. How much would you deduct if you made 2000.00 bi-weekly and were in claim code 4

d. How much would you make if you made $7551.00 bi-monthly and were in claim code 6

4. Compute the total deductions based on the scenarios below. Be sure to use the claim code chart, and deduction tables to complete each.

A. Riley works at Supreme Constructions. He is paid monthly and earns $1500.00 per week. Supreme uses four weeks to compute a monthly earning. On his TD-1 he claimed a total amount of $15256.25. Calculate his total deductions for the month.

B. Keenan works for Rap City Entertainment. He is a roadie and is paid on a weekly basis. He works a five day work week and is paid $325.00/day. His TD-1 declared $21584.25. Calculate his total deductions for the week

C. Mariah is a Welder. She is salaried and makes $70 000.00 annually. She is paid bi-weekly. Her TD-1 declared $11,038.00. Calculate her deductions for the bi-weekly payment.

D. Hannah works as an Admin Assistant. She is paid semi-monthly. Annually she receives a salary of $85 000.00/year. Her TD-1 Declared $23691.00. Calculate her deduction for the semimonthly payment.