Question
Mitchell works for Contech in Nova Scotia and earns an annual salary of $90,000.00, paid monthly. Mitchells employment will be terminated at the end of
Mitchell works for Contech in Nova Scotia and earns an annual salary of $90,000.00, paid monthly. Mitchells employment will be terminated at the end of this pay period. He is entitled to 6% vacation pay on his vacationable earnings of $92,500.00 and 4 weeks' wages in lieu of notice. His vacation-pay and wages in lieu of notice will be paid together on a separate payment from his regular pay.
Mitchells federal and provincial TD1 claim codes are 2. He will not reach the Canada Pension Plan or Employment Insurance annual maximums this pay period.
Calculate the employees net pay on the separate payment. Use 2020 rates. Use the table titled Nova Scotia - Effective January 1, 2020 New Federal Basic Personal Amount.
Hint: Use the bonus method when calculating income taxes.
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