This is an article in Getting Started with Payroll by Wave in Canada.
Direct deposit allows your employees to get paid automatically out of your bank account without you having to write a cheque. Also, if you want Wave to do your remittances to the CRA for you, direct deposit allows us to pay your remittances for you. This doesn't cost anything extra! It is part of the base fee.
There are two things you need to do:
- Set up the bank account that will be used to pay your employees.
- Enter your employee's bank account to receive their paycheque.
Since this is your first time, you want to set this up more than 7 days before your employees need to be paid. Why so early? It can take up to 3 days to make sure the bank account you enter is actually yours. Plus, the transfer of money from your bank account to your employee's bank account will take 4 days.
A lot of Wave customers cut cheques for their first payroll (since you're often on a tight schedule!) and use direct deposit moving forward.
Let's get started!
Set up the bank account that will be used to pay your employees
- In the Payroll section of the left Navigation bar, choose Direct Deposit. If you've never started the Direct Deposit application before, you'll be taken to an Enable Direct Deposit page. Gather a piece of Government Issued ID and have al of your Owner Information available, then click Get Started.
- The Direct Deposit setup process takes 5 steps: Business Information, Owner Information, Identity Verification, Banking Information and Bank Connection.
There are 2 important things to remember when completing this application:
- This is all of the Direct Deposit information related to your Business. We'll ask for your employee's Direct Deposit details later (in the employee's profile) but for now, do NOT enter any employee related information
- This is a different connection than the bank connection to import your transactions in Accounting
- After you enter Business Information (1), you'll enter your Owner Information (2). This will need to be someone with Ownership stake in the business and signing authority on the business bank account.
A soft credit check is also a part of our application. This will not impact your credit score this is something that is done by Wave after this application is completed.
- You will complete a quick ID Verification (3). We'll ask you to upload a piece of Government Issued ID. You MAY see a few ID verifying questions here. Simply answer these to the best of your ability, as quickly as you are able. Since these are timed, don't use google (some wrong answers are fine).
- Add the Banking Information (4) for the Payroll funding account. This is the bank account where money will come out of to pay employees and your CRA remittances. This must be a Canadian bank account.
- You'll then need to create a Bank Connection with our partner VersaPay.
VersaPay is a service Wave uses to ensure your bank transactions and information are secure and process the transactions. Learn more about Wave's relationship with VersaPay.
- On the VersaPay page, enter all of your bank information correctly and set up security questions.
Make sure the email address you enter is one you use often. VersaPay will be in touch!
- On the confirmation page, review all of the information very carefully. If any of it is incorrect, click Edit payment details. If it is all correct, click Approve this Debit Agreement.
- After you confirm the agreement, VersaPay will send you an email to validate your account. The email will have a subject line 'This debit agreement is awaiting bank account verifications."
- The Tricky Part Once you receive the email from VersaPay, within 2-3 days, VersaPay will make a small deposit in your bank account. Once you see this deposit, you need to log in to VersaPay and enter the amount in order to finish your direct deposit set up. The login link will be in the email they send you to validate your account.
The VersaPay transaction should have the description VersaPay BUS. If you don't see the transaction after a few days, or do not have access to online banking, you can call your bank and ask them for the deposit amount.
While you are waiting for the deposit from VersaPay, you can move on to setting up your employees for direct deposit.
- After your bank account is verified in VersaPay it's a good idea to head back to the Direct Deposit section of your payroll account in Wave to check out the status of your Direct Deposit application.
Once your VersaPay agreement is successful and you have verified your account in VersaPay, you are NOT instantly enabled for Direct Deposit in Wave. You'll go through a quick review process on Wave's end, then we'll manually update your account, enabling you to approve payrolls with Direct Deposit. We'll send you an email from Wave when this has happened
Set up where your employee's want their paycheques deposited
- Click on the Employees section and choose the employee you want to set up by clicking on the employee's name.
- Click Direct Deposit from the left menu.
'Confirm account' just means re-enter the account number.
Ensure that the Branch number, Institution number, and Account number are correct! If you aren't sure about any of the numbers, we recommend getting a void cheque from your employee.
- Click Update to save the information entered.
You can come back and edit this information anytime.
You've done all you can do for now! In a few days, you will validate your account with VersaPay then you will be ready to pay your employees with direct deposit.