Complete a mid-year payroll review

Complete a mid-year payroll review

Info
Note: On Rise standard plans, the checks below are the employer's responsibility to keep year-end accurate. Want to hand them off? See Upgrade to Fully Managed Payroll near the end of this guide.

Think of a mid-year payroll review as a check-up for your business. Canadian payroll runs on complex taxable benefits and layered deductions like CPP2, so an error you don't catch until December can turn into penalties and a last-minute scramble.

Reviewing now, in the summer (end of June) or early fall (end of October), leaves you time to fix mistakes while you can still adjust the remaining pay runs this year.

Work through the four checklists below in order. Each point is one action you can complete in your Rise account or against your own records. The Strategic insights and Reports to pull in Rise sections at the end explain the reasoning and point you to the exact Rise reports.

1. Financial balancing and reconciliation

  • Bank vs. payroll audit. Compare your actual bank withdrawals to your internal payroll reports so every dollar leaving your account is accounted for.
  • CRA and Revenu Québec (RQ) balancing. Match your Rise Federal and Quebec remittance reports against your government account balances to confirm payments were received and applied to the correct period.
  • Post manual payments. Enter every manual cheque you issued to an employee. If any are missing, your T4 and RL-1 totals will be under-reported.
  • Review the general ledger (GL). Scan the payroll expense GL for unusual amounts, especially cases where the company is paying both benefit portions for employees on leave, which may need specific tax coding.

2. Tax and government compliance

  • Get ahead of the PIER review. The CRA's Pensionable and Insurable Earnings Review (PIER) happens at year-end. Catching lagging deductions now lets you catch up gradually over several months instead of hitting an employee with one large deduction in December.
  • Record taxable benefits. Enter non-cash benefits such as gift cards, auto allowances, or life insurance now, so an employee's final paycheque of the year doesn't drop to $0 to cover a sudden tax hit. Keep a gift card registry that records who received each card and its dollar amount (up to $500 a year is allowed without tax).
  • Validate CPP2. As of 2024/2025, high earners move to a second tier of CPP once they cross the first earnings ceiling. Confirm your high earners have correctly transitioned to the CPP2 rate.
  • Align WorkSafe / WCB. Check that your year-to-date assessable earnings match the annual estimate you provided, so you avoid a large true-up bill or penalty next spring.

3. Benefits and rate accuracy

  • Confirm benefit provider rates. Many providers update rates in March. Recalculate your benefits and deductions so they match current invoices and your Pensionable Income (PI) settings are accurate.
  • Audit vacation pay. Verify that vacation banks are accurate, accruing at the correct percentage, and that all time taken has been recorded.
  • Reconcile RRSP or registered pension plans. Get statements from your RRSP or RP providers and reconcile them to the GL and sub-ledgers for each employee. If any remittance was missed, remit it as soon as possible.
  • Check maternity or paternity top-up programs. Reconcile all recorded payments against the payroll register. If employees signed a SEB-plan agreement to return for six months after leave, keep a clear record of what you paid them in case any amount is owed back.

4. Data integrity and employee files

  • Verify core identity data. Check every date of birth and SIN. Never pay an employee without a verified SIN on file.
  • Confirm region of work. Confirm the province of employment for each person. This is critical for remote workers, since the province sets their tax bracket and total tax withheld.
  • Check terminations and ROEs. Review your list of past employees and confirm a Record of Employment (ROE) was issued for everyone who left.
  • Check new hires. Some benefit plans have a three-month waiting period, so onboard new employees promptly.
  • Apply mid-year salary changes. After performance reviews, update all rates in payroll and tell your benefit providers about the changes.
  • Protect confidential information. As an employer, you're responsible for safeguarding employee information. Keep only what you need to process payroll and benefits, and shred anything confidential you no longer need.
  • Prep your communications. Update home email addresses now so T4s and RL-1s reach employees in February.

Strategic insights for your review

The cash-flow advantage

Reconciling taxable benefits and PIER shortfalls now protects your employees' take-home pay. Adding a $2,000 car allowance benefit in December, for example, could wipe out a staff member's holiday paycheque to cover the tax. Spreading that tax across the remaining six months is far more manageable.

The CPP2 watch

By April 2026, many mid-to-high earners will be approaching the Year's Maximum Pensionable Earnings (YMPE). Mid-year is the time to confirm your system has automatically triggered CPP2 (the 4% employee and employer contribution) for earnings between the first and second ceilings.

Remote work and provincial taxes

If an employee moved from BC to Ontario in March but their province of employment wasn't updated in payroll, they'll be taxed incorrectly all year. Correcting this mid-year prevents a large "tax due" surprise when they file their return.

Reports to pull in Rise

Open the Reports section of your Rise dashboard and pull the reports below to work through your review.

  • Payroll Register report. Use this for your bank reconciliation. It shows total net pay and total cost for each pay period.
  • Federal / Quebec remittance reports. Balance these against your CRA My Business Account or Revenu Québec portal. They show exactly what was remitted for CPP, EI, and income tax.
  • Employee Information reports. Export these to audit SINs, dates of birth, home emails, and provinces of employment, along with tax-form delivery and accrual balances.
  • Organization Payroll Instructions report. Use this to check how your current payroll instructions are set up.
Notes
Note: When you're ready to preview your tax forms, follow Preview T4s before closing the year to run a Mid-Year Review in Rise.

Upgrade to Fully Managed Payroll

If this list feels like a lot, you don't have to handle it alone. Upgrade to Fully Managed Payroll and our team takes over:

  • End-to-end processing. We handle the day-to-day payroll execution.
  • Account maintenance. We keep your rates, deductions, and PI settings up to date.
  • Proactive mid-year reviews. We run the health checks in this guide for you.
  • Year-end filing. We manage the full T4 and RL-1 process from start to finish.

Interested? Email our sales team at sales@risepeople.com for a plan comparison and quote.

Get help from Rise

Have a question while you work through your review, or need help updating something in your account? Reach us any of these ways:

  • Knowledge Base. Search our Knowledge Base for step-by-step guides.
  • Submit a ticket. Click the ? icon in the top right of your Rise account, scroll to the bottom, and choose Submit a Ticket.
  • By phone. Call 1-888-393-3483 and press 1 to reach a support agent, available 5:00 AM – 5:00 PM PST (8:00 AM – 8:00 PM EST).
  • Live chat. Use the chat box in the bottom-right corner of your Rise account.

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