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National Payroll Institute PF1 Exam Syllabus Topics:
| Section | Objectives |
|---|---|
| Payroll Accounting | - Payroll accounting practices
|
| Workers’ Compensation | - Workers compensation administration
|
| Commission Payments | - Commission payroll processing
|
| Federal Remittances | - Government remittance obligations
|
| Non-Regular Payments | - Special payroll payments
|
| Non-Statutory Deductions | - Voluntary deductions
|
| Year-End Processing | - Federal and provincial year-end reporting
|
| Record of Employment | - ROE processing
|
| Provincial Remittances | - Provincial payroll requirements
|
| New Employee Information | - Employee setup and documentation
|
| Employment Income – Regular Earnings | - Regular payroll calculations
|
| Termination of Employment | - Termination processing
|
| Employment Income – Allowances, Expenses and Benefits | - Taxable and non-taxable benefits
|
Everything Candidates Ask About PF1 at PracticeVCE
- Workers’ Compensation ()
- Commission Payments ()
- Non-Statutory Deductions ()
National Payroll Institute Payroll Fundamentals 1Exam Sample Questions:
Which pension plan requires the services of an actuary to study and forecast future needs of the plan to ensure the plan remains sufficiently funded to provide employees with their retirement benefits?
- A. Defined benefit pension plan
- B. All of the above
- C. Defined contribution pension plan
- D. Registered Retirement Savings Plan
Correct Answer: A 🗳️
The authorization for hiring form should contain a checklist to ensure the organization obtains all required information. What is an example of an item that could be on that checklist?
- A. All of the above
- B. A completed T1213
- C. A benefit enrollment form
- D. A clearance certificate
Correct Answer: C 🗳️
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Alyssa is a member of her employer's Defined Contribution Pension Plan. The plan defines the contribution as 3% of the employee's pensionable earnings, with the employer matching the employee's contribution.
Alyssa's pensionable earnings are $3,400.00 per month. Calculate the total payment to be remitted to Alyssa's Defined Contribution Pension Plan each month.
Correct Answer:
$204.00 per month
Explanation:
In a Defined Contribution (DC) pension plan, contributions are calculated as a set percentage of the employee' s pensionable earnings, and the total remittance is usually the sum of the employee deduction plus the employer's matching contribution, based on the plan text. Here, the plan states the employee contributes 3% of pensionable earnings, and the employer matches the employee contribution.
Step 1: Calculate the employee's pension contribution:
3% × $3,400.00 = 0.03 × 3,400.00 = $102.00.
Step 2: Calculate the employer match:
Because the employer matches the employee contribution, the employer contributes $102.00 as well.
Step 3: Total remittance to the plan:
$102.00 (employee) + $102.00 (employer) = $204.00 each month.
From a payroll processing perspective, the employee amount is withheld from gross pay as a payroll deduction according to plan rules, while the employer match is recorded as an employer expense. Payroll remits both amounts to the plan administrator following the plan's remittance schedule, and should reconcile pensionable earnings and contributions to ensure accuracy and compliance with plan terms.
(PF1 Exam - Net Pay Calculation Template Worksheet: Quebec)
Question ID: pf1-exam-npc-q-f
Mara Poirier works for Affordable Transport in Quebec and earns an annual salary of $54,500.00, paid on a semi-monthly basis.
In addition to her regular salary, Mara's employer provides the following benefits:
Group term life insurance coverage through a third party of two times her annual salary.
Monthly group term life insurance premiums are $0.57 per $1,000.00 of coverage, excluding taxes.
Private health insurance benefits with a monthly premium of $260.00, excluding taxes.
The tax on insurance premiums in Quebec is 9%.
Mara's federal TD1 claim code is 3 and her provincial TP-1015.3-V deduction code is C.
Mara will not reach the annual maximums for QPP, EI, or QPIP in this pay period.
Required: Calculate Mara's net pay, following the order of the steps in the net pay template.
EXHIBIT A - Net Pay Template (Fill in all blanks)
Earnings / Income Bases
Step 1 - Calculate Mara's gross earnings for this pay period (GTE).
[ ____________________________________________ ]
Step 2 - Calculate the pensionable earnings (PE).
[ ____________________________________________ ]
Step 3 - Calculate the insurable earnings (IE).
[ ____________________________________________ ]
Step 4 - Calculate the net taxable income (CRA) (NTI).
[ ____________________________________________ ]
Step 5 - Calculate the net taxable income (RQ) (NTI).
[ ____________________________________________ ]
Step 6 - Calculate Mara's Quebec Pension Plan (QPP) contribution.
[ ____________________________________________ ]
Step 7 - Calculate Mara's Employment Insurance (EI) premium.
[ ____________________________________________ ]
Step 8 - Calculate Mara's Quebec Parental Insurance Plan (QPIP) premium.
[ ____________________________________________ ]
Step 9 - Determine Mara's federal income tax.
[ ____________________________________________ ]
Step 10 - Determine Mara's Quebec provincial income tax.
[ ____________________________________________ ]
Step 11 - Calculate Mara's total deductions.
[ ____________________________________________ ]
Step 12 - Calculate Mara's net pay.
[ ____________________________________________ ]
Correct Answer:
See the Explanation part for answer for each step.
Explanation:
Step 1 - Mara's gross earnings / taxable earnings components
Semi-monthly salary = $54,500.00 ÷ 24 = $2,270.83
Life insurance coverage = 2 × $54,500 = $109,000
Monthly premium (excl. tax) = 109 × $0.57 = $62.13
9% insurance premium tax = $62.13 × 1.09 = $67.72
Semi-monthly taxable benefit = $67.72 ÷ 2 = $33.86
Health premium (excl. tax) = $260.00
9% insurance premium tax = $260.00 × 1.09 = $283.40
Semi-monthly taxable benefit (Quebec) = $283.40 ÷ 2 = $141.70
GTE (total taxable in Quebec) = 2,270.83 + 33.86 + 141.70 = $2,446.39
Step 2 - Pensionable earnings (PE)
For this calculation, treat salary + taxable group term life as pensionable for QPP withholding, while EI remains non-insurable for non-cash benefits.
PE = 2,270.83 + 33.86 = $2,304.69
Step 3 - Insurable earnings (IE)
IE = salary only = $2,270.83
Step 4 - Net taxable income (CRA) (NTI)
Federal taxable income uses salary plus taxable benefits used for federal withholding tables here.
NTI (CRA) = $2,304.69
Step 5 - Net taxable income (RQ) (NTI)
NTI (RQ) = $2,446.39
Step 6 - QPP contribution
Use the QPP employee rate (basic + additional) and apply the basic exemption prorated per pay period.
Basic exemption per semi-monthly period = $3,500 ÷ 24 = $145.83
Contributory earnings = PE # 145.83 = 2,304.69 # 145.83 = $2,158.86
QPP = 2,158.86 × 6.4% = $138.17
QPP = $138.17
Step 7 - EI premium
Quebec EI employee rate for 2026: 1.30%.
EI = 2,270.83 × 0.0130 = $29.52
Step 8 - QPIP premium
Use the Revenu Quebec employee QPIP rate shown for 2026.
QPIP = 2,270.83 × 0.00430 = $9.76
Step 9 - Federal income tax
From the CRA Quebec federal tax deductions table (24 pay periods), at pay $2,304.69 (range 2288-2306) and claim code 3, the federal tax is:
Federal tax = $139.95
Step 10 - Quebec provincial income tax
From TP-1015.TI.24 (24 pay periods) at remuneration $2,446.39 (range 2445.00-2464.99) and deduction code C, the tax is:
Quebec tax = $214.81
Step 11 - Total deductions
QPP 138.17
EI 29.52
QPIP 9.76
Federal 139.95
Quebec 214.81
= $532.21
Total deductions = $532.21
Step 12 - Net pay
Net pay is based on cash pay (salary) minus deductions (tax still applies even when part of taxable income is a benefit).
Net pay = 2,270.83 # 532.21 = $1,738.62
Raminder was hired in January 1997. He was fully vested in the organization's pension plan at the time he received the retiring allowance. His employment was terminated on May 1, 2006 and he was paid a
$10,000.00 retiring allowance. Calculate the eligible portion of the retiring allowance.
- A. $10,000.00
- B. $2,000.00
- C. None of the retiring allowance is eligible
- D. $7,500.00
Correct Answer: C 🗳️
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