The Pitfalls of Using an Online Payroll Tax Calculator
If you have a nanny, an elder caregiver, or a housekeeper, you likely feel a bit lost when it comes to the CRA and employer taxes. With good intentions you choose an online calculator or tool, and use it to do the math and come up with the numbers. While you may think using an online calculator to figure payroll tax is a good idea, these tools can end up costing you a lot more in the end.
How Can They Be Wrong?
You may have double checked your numbers with a second or even a third online calculator, and all the numbers matched. How can they be wrong? A calculator cannot take into account additional information that a professional would catch. A professional will ask you the right questions to learn about your situation. This may end up changing the numbers being entered into their calculator. If you are putting the wrong information in, the wrong information will also come out as the answer. If you put that wrong number into three calculators, it makes sense that you would get the same wrong answer back each time.
On top of human input error, there’s also the question of how old the tool is. You may be using a tool you actually paid money to use that hasn’t been updated with the newest formulas and rates. One little error can cost you, and anyone else who uses it, some steep fines.
When the Error is Caught
Many times the error isn’t caught until the end of the year, or even later. You take your information to an accountant to figure your personal end of year taxes and suddenly a bomb is dropped. The numbers don’t add up. But you used an online calculator, it has to be right! Sadly, this very common at tax time. Sometimes, your accountant won’t even catch the error and it is only discovered when the CRA does a random audit.
One little math error, multiple by six, nine, or even twelve months, can cost you hundreds of dollars in fines and penalties, on top of the difference that you originally owed. This means that the DIY online calculator could end up being anything but free.
An Affordable Option with the First Month Free
Many people use online calculators because they either don’t know where to go for household employee payroll tax help or they think they can’t afford the fee. The truth is that letting a professional do the math for you can cost as little as $39 a month, with a free trial and free setup. The professional team at NannyTax.ca are tax experts! We do everything from setting up your CRA and WCB accounts to making sure you are compliant with your provincial Employment Standards.
There are three different packages to choose from, all without commitment, hassles, contracts, or fees. Visit us today to get started or call us at 1-877-626-6982.
