Deductions and Tax Forms

Upon hire, employees must complete a Federal TD1 Personal Tax Credits Return form and the applicable provincial TD1 form corresponding to their province of work so that the employer can determine the amount of tax to deduct from their salary. Eligible employees may request an exemption from income tax if their work location is situated on a reserve.

Federal TD1 forms are also required to request additional tax deducted above the basic personal amount or to modify the existing tax deduction, if required. For example, it could be beneficial for students to request less than the basic personal amount as tuition fees claimed on their annual returns may reduce federal taxes payable.

All employees should submit new tax forms when changes occur to their personal tax credit amount or province of work, province of work or remote working location.

  • How to modify existing income tax deducted from your pay

    1. To modify the amount of federal or provincial tax deducted, employees must complete the required form(s) and submit a Pay Action Request (PAR) form to the Pay Centre for processing.

      • Top Right Corner: enter total number of pages (including PAR) and date of request
      • Section 1: enter Employee Information
      • Section 2: Work Type: select “Deductions”
      • Section 3: Sub Type: select “Voluntary self-service deductions – exception”
      • Effective date: is the date the tax deduction should take effect
      • Section 4 - Requestor: enter your name and email address
      • Comments: Ex. I would like an extra $50 of Quebec income tax deducted from my pay. See completed form attached.
      • Section 5: Leave blank. No trusted source is required for this type of request.

    2. There are three (3) methods to submit the completed PAR form and required documents to the Pay Centre:

    Important: If any mandatory fields are not completed on the PAR or if the appropriate tax form is not included, the request will be rejected causing delays in processing your request.

  • How to request an Income Tax Exemption for employees working on reserve

    The Indian Act Exemption for Employment Income Guidelines will help you determine whether your employment income is considered to be situated on a reserve. The guidelines are an administrative tool and deal with the most common employment situations. After each guideline, there are examples showing how the guideline applies.

    Where it is established that employment income paid is exempt from tax, the employee can ask their employer to waive the tax deductions at source by completing Form TD1-IN - Working on Reserve.

    Note: It is recommended the form be completed by the manager in the presence of the employee.

    • Employee Responsibilities

      Important: You are responsible for completing new forms at the end of the teleworking period or when a change occurs affecting a current income tax exemption.

      If applicable, arrange to meet with your manager to complete Form TD1-IN. Your manager will submit the request on your behalf.

    • Manager Responsibilities

      This type of request requires submission by a Trusted Source. Therefore, you must send the request via the HR Portal on behalf of your employee:

      • I am a Manager
      • Select Pay Related Action
      • Completed Employee information
      • Category: Select Deductions
      • Sub-Category: Select TD1-IN – Working on Reserve
      • Effective Date: the date of the request
      • Attach the completed TD1-IN
      • Submit your request

      Note: There is no need to complete a Pay Action Request (PAR) form; the Compensation Services Directorate will do this when the request is sent to the Pay Centre for processing.

  • How to request a one-time tax exemption for lump sum payments (ex. retroactive revision)

    Employees may request a tax exemption on eligible lump sum payments in order to transfer the full or partial amount directly to a Registered Retirement Savings Plan (RRSP) without income tax withheld at source. This type of request is limited to certain, eligible payments and if you have sufficient RRSP room, as determined by the Canada Revenue Agency (CRA). If you are eligible for such a payment, the Pay Centre will contact you by letter with options for disbursement.

    Income tax is deducted from all other non-eligible lump sum payments, such as retroactive revision. The total amount deducted for federal and provincial income tax will be determined from tax tables established by Canada Revenue Agency (CRA) and Revenu Québec, applicable to the province or territory in which you work.

    Employees who would like a tax waiver on such payments must apply directly to the CRA or to Revenu Québec by submitting the following forms:

    CRA / Revenu Québec will send you a letter indicating whether your request has been granted or denied and, if applicable, the amount of the reduction.

    If you receive a confirmation from CRA / Revenu Québec that your request is allowed, you must submit the approval letter to the Pay Centre before the lump sum is calculated and the payment is produced. Approved tax waivers cannot be applied retroactively.

    1. Complete a Pay Action Request (PAR) form:

      • Top Right Corner: enter total number of pages (including PAR) and date of request
      • Section 1: enter Employee Information
      • Section 2: Work Type: select “Deductions”
      • Section 3: Sub Type: select "One-Time Tax Exemption"
      • Effective date: enter the date of the request
      • Section 4 - Requestor: enter your name and email address
      • Comments: Clearly identify your request, e.g. Tax waiver request for retroactive payment, approval letter attached
      • Section 5: Leave blank. No trusted source is required for this type of request.

    2. There are three (3) methods to submit the completed PAR form and required documents to the Pay Centre:

    Important: If any mandatory fields are not completed or the waiver approval letter(s) not attached, the PAR form will be rejected causing delays in the processing of your request.

  • Voluntary Deductions

    Voluntary deductions are amounts / contributions deducted from each pay and sent directly to a financial institution, e.g. the Fonds de solidarité des travailleurs du Québec (FTQ) of the employee’s choosing.

    Employees can view their voluntary deduction summary through Phoenix Self-service, where they are also able to start a new deduction or amend / stop an existing deduction at any time. Employees can visit the Phoenix User Productivity Kit (UPK) for a tutorial on Employee/Voluntary Deductions.

    • How to add a voluntary deduction

      1. Log into Phoenix Self-service

        Main Menu > Self-Service > Payroll and Compensation > Voluntary Deductions > Add deduction

      2. Select “Add Deduction”;
      3. Type of Deduction: choose your financial institution using the magnifying glass search icon;
      4. Choose “Amount” (this is your only option in Phoenix) and enter the dollar amount to be deducted each pay;
      5. Leave Goal Amount BLANK;

      6. Using the drop-down menus in the calendar icon, select the deduction start date;

        Note: The full deduction amount will begin in the pay period that includes this date.

      7. Using the drop-down menus in the calendar icon, select the deduction start date only if you want your deduction to cease on a certain date;

        Note: Leave BLANK if the deduction is ongoing

      8. Enter the Contract/Reference # field;

        Note: Check your contract for this information; contact the Service Provider if unsure which number to use

      9. Review your entries and Submit your request
    • How to amend / stop a voluntary deduction

      1. Log into Phoenix Self-service to view your existing voluntary deduction summary;

        Main Menu > Self-Service > Payroll and Compensation > Voluntary Deductions

      2. Select the “Edit” button for the deduction you wish to amend or stop;

      3. Amend the deduction amount as needed;

        Note: You need to enter the new amount if the deduction is to continue, enter $ 0.01 if the deduction is to STOP;

      4. Keep all other information intact;

      5. Review your entries and Submit your request

        Note: The deduction will stop or the amendment will take effect in the next applicable pay period.

  • How to request a Workplace Charitable Campaign deduction

    The Government of Canada Workplace Charitable Campaign (GCWCC) is a charitable giving option developed exclusively for federal public servants and federal retirees. Through GCWCC, public servants can support United Way/Centraide, HealthPartners and or any other registered Canadian charity of their choosing. Your donation is truly a gift to your community and your charity of choice. By choosing the payroll deduction option, your contribution will automatically appear on your T4 for tax purposes – no need to keep track of your receipts.

    You can make an initial donation or stop / amend an existing donation to the Employment and Social Development Canada Charitable Campaign (ESDCCC) online through ePledge. If preferred, you may complete a paper-based pledge form available from your department campaign leader and send directly to the Pay Centre.

    1. You need to complete a Pay Action Request (PAR) form:

      • Top Right Corner: enter total number of pages (including PAR) and date of request
      • Section 1: enter Employee Information
      • Section 2: Work Type: select “Deductions”
      • Section 3: Sub Type: select "Charitable donations"
      • Effective date: enter date of the request
      • Section 4 - Requestor: enter your manager's information
      • Comments: Clearly identify the request, e.g. Attached is a pledge form for the 20XX GCWCC
      • Section 5: Leave blank. No trusted source is required for this type of request.

    2. There are three (3) methods to submit the completed PAR form and required documents to the Pay Centre:

    Important: If any mandatory fields on the PAR form are not completed or the appropriate form is not attached, the request will be rejected causing delays in processing your request.

  • Submit a Pay Escalation request
    • Employee responsibility

      If you are experiencing a pay issue related to your deduction, you must refer to the Pay Escalation Process and, if deemed appropriate, submit an escalated pay issue request using the category Escalated deduction issue, applicable sub-category.

    • Manager / Section 34 Manager responsibility

      If an employee is on leave or terminated and is experiencing a pay issue related to their deduction, you must refer to the Pay Escalation Process and, if deemed appropriate, submit an escalated pay issue request on their behalf using the category Escalated deduction issue, applicable sub-category.

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