QuickBooks HelpQuickBooksHelpIntuit

Vacation pay for bonuses in QuickBooks Online Payroll

SOLVEDby QuickBooks12Updated January 25, 2024

There are two different kinds of employee bonuses in Canada, and each is paid in a different way in QuickBooks Online Payroll.



Work-related (normal pay run)

This type of bonus earns vacation pay.

You can include a work-related bonus when you do a normal payroll run. This is a specific amount your employee has earned. The bonus is included on the regular paycheque. When you use this type of bonus, the employee earns vacation pay on that amount (a percentage). If you give your employee a $1,000 bonus on their paycheque, they will also earn vacation pay on that amount.

In all provinces except for Saskatchewan, an employer is required to pay a minimum of 4% vacation pay. This means if an employee receives a $1000 bonus they also earn $40 in vacation pay, which can either be paid-out (included on the paycheque) or accrued and paid out later.

To add a bonus to a regular paycheque see How to create a bonus paycheque.



Discretionary (bonus-only pay run)

This type of bonus does not earn vacation pay.

You generally give a discretionary bonus to an employee in good gesture for non-work related events. An example of this is when you are rewarding all staff with a Christmas bonus at year-end. As this type of bonus does not earn vacation pay, the employee would receive $0 in vacation pay on a bonus of $1,000.

To give discretionary bonuses create a separate bonus cheque.

Was this helpful?

You must sign in to vote, reply, or post

Sign in for the best experience

Ask questions, get answers, and join our large community of QuickBooks users.

More like this