Employer Contribution Match Limitations

Thanks for checking in with us, IRAheidi.

The IRS sets a limit on how much you can contribute to a retirement plan in a given year. The amount you and your employee can contribute depends on many factors. Please check with your plan provider for details for more details about this one.

To pay the Simple IRA employer contribution to employees, let's set up a retirement plan deduction or a company-match contribution item in QuickBooks. Let me guide you on how: 

1. Go to Payroll, then Employees, and select your employee.
2. From Deductions & contributions, tap Start or Edit.
3. Choose + Add deduction/contribution.
4. Select Retirement Plans in the Deduction/contribution type dropdown.
5. For Type, select the applicable retirement plan. If you need to track a company-only contribution with no employee match, choose Company-only plan.
6. Enter the name of the provider or plan in the Description (appears on paycheck).
7. Complete the remaining fields.
8. If you have a company match, under Company contribution, select the dropdown menu to choose how you want to calculate the amount. Complete the new fields to enter the amount or percent per paycheck and annual maximum.
9. Press Save then Done.

Perform the same procedure to assign it to your employees. When creating paychecks, the employer contribution will automatically show on the workers’ payroll information.

For additional resources, check out the Retirement plan deductions/contributions article. It provides an overview of how to assign the payroll item to employees and steps to remove the deduction.

Please get back if you have other retirement plan deductions or company contribution concerns. I'm still here to help. Take care always, and more power to your institution!

There does not seem to be a way to limit the employer contribution to less than or equal to the employee contribution.

Hi jgaliley,

You can limit the employer contribution to be less than or equal to the employee contribution in QuickBooks Online Canada.

Here are the steps to set it up:

1. Go to Payroll and select Employees.
2. Select the employee’s name.
3. From Deductions & contributions, select Start or Edit.
4. Select + Add deduction/contribution.
5. Select an existing Deduction/contribution or add a new one.
6. Under the Employee deduction section, select how your deduction is calculated. Then enter the amount or percentage.
7. Under the Company/Employer contribution section, select how your contribution is calculated. Then enter the amount or percentage.
8. Select Save, then select Done.

Please note that the maximum annual contributions for CPP or QPP (if in Quebec) are the same for both employers and employees.

If you have further questions, please let me know. 

We are not in Canada?

I'll guide you on how you can match the contribution of both the employee and employer. jgaliley.

You can set this up in your employee's profile under deduction and contribution. For you to have a visual guide, I've added some of the steps with screenshots.

1. Go to the Payroll menu, and select Employees.
2. Choose the employee.
3. Under the employee's profile, under Deductions & contributions, click Edit.
   
4. Then, click Add deduction/contribution. Enter the contribution.
   
5. Click Save and Done.

You can do this to your other employers who are affected by the setup as well. Furthermore, learn how you can create and send scheduled payroll for your employees. I've added this article for more details: Create And Run Payroll.

Post your comment below if you have any questions when setting up deductions and contributions. The Community is always here to help you 24/7.

We need it to be 3% of gross payroll unless the employee contributed less than the 3%. There is no option in the dropdown for this granularity.