Payroll year-end checklist for Canada

Take the steps provided in this guide as early as possible to ensure your 2024 filings are accurate.

At a glance

Bring everything together with reconciliation

If you pay your employees by cheque, perform a payroll reconciliation through December 31, 2024. Look for outstanding cheques and make sure you've accounted for employee expense reimbursements. Compare payroll tax withdrawals from your bank account to the amounts on your tax liability records. To review payroll taxes in Wave, go to Payroll > Taxes. For more steps and insight into year-end accounting, check out: Accounting year-end checklist.

Verify your employees' wages, benefits and personal information

Audit employee wages for EI and CPP discrepancies

Unless your employee was exempt for the whole year, or part of the year, you should deduct EI premiums and CPP contributions from each pay.

The 2024 EI rate is 1.66%. To help verify, take the amount reported in Box 24 on the T4 and multiply it by 1.66%. The amount should match what is reported in Box 18. Due to rounding it is normal for the amount to vary by a few cents. Employer portions of EI are 1.4 times the employee premiums. 

The 2024 CPP rate is 5.95%, with an annual exemption amount of $3,500. From tax year 2024, CPP2 contributions that have been deducted from an employee must be reported on the T4. These CPP2 contributions are reported in box 16A. If no CPP2 contributions were deducted, then no amount is reported in box 16A. The total amount of pensionable earnings is reported in box 26. This is the amount used to calculate your employee's CPP contributions reported using box 16 and box 16A.

The CRA provides a step-by-step guide to check CPP contributions. Employer portions of CPP should match employee contributions. 

If you find your CPP and EI amounts do not match, follow the CRA guidance here.

Make sure benefits enjoyed this year are included on 2024 payroll

If you are missing a benefit and have yet to run your final 2024 payroll, you can add it to payroll before the end of the year. To do this, go to the employee profile > click Benefits & Deductions. Find more information about adding deductions, bonuses and benefits here. 

If you're missing a benefit and cannot add it to a future payroll in Wave, open Mave, Wave’s automated chatbot, and type missing benefits. Mave will help collect any relevant details and direct you to the appropriate support. Learn how to open Mave in Get support with Wave.

Reflect on business structure changes this year

If you made changes to your business structure in 2024 that resulted in a new Canada Revenue Agency (CRA) Payroll Account Number (e.g. incorporating from a sole-proprietorship), you would have already submitted T4 slips with your old CRA Payroll Account number when the change occurred. Ensure wages reflected on year-end forms only include wages paid towards your new CRA Payroll Account Number. You’ll need to create a second business in Wave for your restructured business

• What to do when your business structure changes.

Preview your T4 slips

Take advantage of previewing your T4 slips now to make sure you’ve entered correct wages, benefits and employee information for 2024. To preview your T4 slips, go to Payroll > Tax Forms.

• How and Why to Preview T4 Slips

Important direct deposit dates

As 2024 comes to a close, it's important to keep direct deposit timelines in mind. Payrolls and direct deposits do not process on Federal bank holidays. This means if a bank holiday falls on the day you normally approve payroll, pay employees, or anytime in between, you must approve payroll at least one business day earlier. The following dates are bank holidays to keep in mind:

December 23, 2024: The last day to approve a direct deposit payroll with a 2024 pay day. Make sure that your payroll is approved no later than 3:00 PM Eastern on December 23, 2024 for the payroll to be reported in the 2024 tax year.

Audit your T4A contractor information

In order for contractor payments to show up on the T4A slip at year-end, the contractor must have been listed as a T4A contractor in your Vendors list. If you need to update this, here's how:

1. Under Purchases > Click Vendors
2. Select the Vendor Name
3. Click the arrow under Actions > Click Edit
4. Under the vendor name > Locate Type
5. Update the vendor type to T4A contractor Click Save

Make sure to review and confirm all contractor information is accurate. If your contractor is an Individual, ensure that their Social Insurance Number (SIN) is correct. If your contractor is a Business, ensure their CRA Account Number and Business Legal Name are correct.

Review contractor bills and bill payments

In order for contractor payments to appear on 2024 T4A slips, ensure the related bill payments in Wave are recorded as paid in 2024. Payments made to a T4A contractor totalling more than $500 in the year require a T4A slip.

If you are a construction company paying subcontractors for construction services, you will file Form T5018 Statement of Contract Payments instead of the T4A slip. Wave does not generate slip T5018. For more information on this type of return, see T5018 slip – Statement of contract payments. If you have additional questions about T5018 or your business's specific tax needs, contact the CRA or your tax professional.

Update employee tax profiles for 2025

January 1, 2025 If employee federal or provincial claim amounts have changed, they must submit new forms to their employer to ensure accurate payroll calculations. Otherwise, make sure tax details are up to date with the 2025 basic exemption amounts. Here's how:

Use the federal and provincial/territorial TD1 forms your employee completes to enter their tax details into their employee profile.

1. On the left-side menu, click Payroll > Employees.
2. Click on the name of the employee.
3. Once the employee page loads, click on Tax Details.
4. If the total claim amount is the same as the Basic Personal Amount listed on the TD1 form, you can leave the Use Federal/Provincial basic amount box checked.
5. If the total claim amount is different from the Basic Personal Amount listed on the TD1 form, you can uncheck the Use Federal/Provincial basic amount box and then enter in the total claim amount.
6. When you are finished editing the employee’s tax profile, make sure you click Save.

Confirm your deposit frequency for 2025

December 2024: Review notices received before the end of 2024 from the Canada Revenue Agency (CRA) with updates to your business' remittance deposit frequency. To update your remittance frequency, see Update your business tax profile. Please update this as soon as possible - you can make the effective date January 1, 2025.

Key dates: get your forms to the CRA and to your workers

February 4, 2025: T4 Slip generation is available in Wave.

February 28, 2025: This is the last day to get your T4 and T4A slips to employees and contractors. 

February 28, 2025: This is the last day to submit T4/T4A summaries and T4/T4A slips to the CRA.