Math 11 Earning and Spending Money
Book 2: Pay Statements and
Deductions
Name: ______________________________
Start Date: ______________
Completion Date: ________________
Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
Edited April 2015
Year Overview:
Earning and
Spending Money
1. Earning Money
2. Pay Statements
and Deductions
3. Responsible
Spending Habits
Home
4. Data in Your Life
5. Measurement
6. Angles and
Triangles
Travel and
Transportation
7. Let’s Travel
Project
Recreation and
Wellness
8. Personal Health
and Wellness
9. Puzzles and
Games
Topic Overview
You may have already entered the workforce and have some knowledge
about earning and spending money. The intent of this theme is to help you be
aware of financial decision making that you face. In this topic, you will learn
about how to read a pay statement and what deductions come off your pay.
Suggested Timelines: ____ Hours
Outcomes
Overlapping Outcomes in Pay Statements and Deductions
M11.1 Extend understanding of arithmetic operations to rational numbers to
solve problems within the home, money, recreation, and travel themes.
Theme Specific Outcomes
M11.8 Demonstrate understanding of income.
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
Edited April 2015
Contents
Topic Overview.................................................................................................................. 2
Outcomes ....................................................................................................................... 2
Contents ......................................................................................................................... 3
Glossary of Terms ........................................................................................................... 4
Pay Statements and Deductions .................................................................................... 5
Check What You Know ................................................................................................ 5
Pay Statements and Deductions .................................................................................... 7
2.1 Deductions ................................................................................................................... 8
A. Income Tax ................................................................................................................ 8
B. Calculating Taxes .................................................................................................... 10
C. How the Government Calculates Federal and Provincial Income Tax ........ 13
C. How the Government Calculates Federal and Provincial Income Tax ........ 13
D. Online Tax Calculations ......................................................................................... 14
E. Canada Pension Plan (CPP) ................................................................................. 16
F. Employment Insurance (EI) .................................................................................... 17
2.2 Earnings/Pay Statements ......................................................................................... 20
Show What You Know – Review Assignment .............................................................. 23
Student Evaluation .......................................................................................................... 26
Learning Log .................................................................................................................... 27
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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Glossary of Terms
Basic deductions: deductions required by law, including Income Tax, CPP, and
EI
Canada Pension Plan (CPP): contributions which provide you and your
dependents some financial protection throughout your life
Deductions: taken off gross pay
Earnings statements: summary of your pay and deductions
Employment Insurance (EI): benefits that may be paid if you lose your job
Federal Income Tax: paid to the Canadian Government at a rate that increases
as your gross wage increases
Net pay: pay after deductions removed from gross pay
Pay statement: a summary of your earnings and deductions
Provincial Income Tax: deductions paid to the provincial government
Secondary deductions: deductions that vary by employer, including union dues,
health benefits, insurance
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
Edited April 2015
Pay Statements and Deductions
Check What You Know
Vocabulary Check-Up
Do you know the meaning of the following words? Circle all of the words that
you know.
basic deductions
Canada Pension Plan (CPP)
deductions
Earnings statements
Employment Insurance (EI)
Federal Income Tax
net pay
Provincial Income Tax
secondary deductions
Pick any 2 of the words that you know already and write down what they mean,
in your own words.
1.
2.
Write down all of the words that you don’t know already and find out what they
mean. You might ask someone else to tell you, or look them up in the dictionary
or on the internet. After doing so, write down what they mean below, in your
own words.
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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Check Your Skills
Ask Your Teacher how many of the following questions you should complete.
Calculate the following. Round your answers to two decimal places when
necessary.
Math skills are embedded
into real life situations. In this
unit, you will use the
following skills:
1. 4 095 – 3 212
2. 75 095 – 61 025
3. 8 295 + 1 256
•
4. 101 578 + 32 895 + 4 095
5. 45 200 x 3
6. 34 202 x 0.23
7. 6 702 x 0.1
•
8. $24.50 x 1.5
9. $435.90 ÷ 7
Addition, subtraction,
multiplication and
division
o whole number
o decimals
relating decimals,
percents, and
fractions
10. $125.60 ÷ $5 275
11. Convert each decimal number to a percent.
a) 0.25
b) 0.01
c) 0.08
d) 0.8
e) 0.0125
12. Write each percent as a fraction
a) 12% =
b) 24% =
c) 2% =
d) 28% =
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
Edited April 2015
Pay Statements and Deductions
Your pay statement is a record of the money you earned and the deductions
you paid during a specific period. By law, an employer must deduct the
following amounts from your employment earnings:
• Income tax
• Employee contributions to Employment Insurance (EI)
• Employee contributions to the Canada Pension Plan (CPP)
These deductions mean that the amount on your pay cheque will be less than
the total you earned. The amount of money you take home after deductions is
called Net Pay.
Deductions
Gross Pay
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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2.1 Deductions
Income Tax, Canada Pension Plan, and Employment Insurance premiums are
known as Basic Deductions.
Secondary Deductions are also taken off your gross pay. They vary greatly
depending on your work and your contract with your employer. Deductions
may include group life insurance, union dues, disability insurance, etc.
A. Income Tax
There are two income taxes deducted – Federal and Provincial.
Discuss the Ideas
1. Federal income tax goes to the Canadian Government. What do you think it
pays for?
2. Provincial income tax goes to the province of Saskatchewan. What do you
think it pays for?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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Here is a chart indicating divisions of powers and responsibilities for Federal and
Provincial Governments and where income tax money will go:
Division of Powers and Responsibilities
Federal Government
Provincial Government
• Armed Forces
• Courts and civil laws
• Copyright
• Property laws
• Immigration
• Highways
• National defence and
• Education and schools
security
• Drivers’ licences
• Passports
• Health services and hospitals
• Postal services
• Provincial parks and heritage
• Supreme Court of
sites
Canada
• Management of province’s
• Relations with Aboriginal
natural resources
Peoples
• Labour laws: minimum wages,
• Royal Canadian
work conditions, safety
Mounted Police
• Liquor licenses
(RCMP)
• Marriage licenses and divorce
• War and peace
decrees
• International
• Family courts, child custody
development
• Child protection services
and aid
• Legal names
• Employment Insurance
• Birth certificates
• Foreign policy
• Criminal law
• Treaty negotiations with
First
Nations
• International trade and
commerce
• Money and banking
• Old Age Pensions
• Child tax benefits
• Trans-Canada Highway
• Shipping waterways
• Social Insurance Numbers
• Telecommunications and
Internet
• Federal parks and
heritage
sites
• National health care
funding
Shared Responsibilities
• Transportation
• Communication
• Immigration
• Health
• Environment
• Agriculture
• Social assistance
• Correctional
facilities
• Energy
• Human rights
• Marriage and
divorce laws
• Tourism and travel
• Income taxes
• Sales taxes
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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B. Calculating Taxes
It is beneficial to be able to calculate what amount of your income will go to
taxes and other deductions.
Example 1:
Chang makes $65 891 per year. If he has to pay 18% to Federal
income tax, how much does he have to pay?
To do this, we need to calculate 18% of $65 891
Step 1:
Change 18% to a decimal number
18 ÷ 100 = 0.18
Step 2:
Multiply the amount by the decimal number
$65 891 x 0.15 = $11 876.58
Chang paid $11 876.58 in Federal Income Tax
Example 2:
Kenneth made $2 350 for a two week period. He paid $352.50 in
federal income tax. What percent was taken off in federal tax?
Step1:
Divide the taxes by the amount made
$352.50 ÷ $2 350 = 0.15
(You will always end up with a decimal)
Step 2:
Multiply 0.15 x 100 to find the percent = 15 %
Kenneth paid 15% Federal Income Tax
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
Edited April 2015
2.1B Practice Your Skills Calculating Taxes
1. Mila makes $35 800 per year.
a. If she has to pay 15% to Federal income tax, how much does she have to
pay?
b. If she has to pay 11% to Provincial income tax, how much does she have
to pay?
c. What is the total income tax she will have to pay?
2. Johnathon makes $27 900 per year.
a. If he has to pay 16% to Federal income tax, how much does he have to
pay?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
Edited April 2015
b. If he has to pay 12% to Provincial Income Tax, how much does he have to
pay?
c. What is the total income tax he will have to pay?
3. Daniel makes $4 500 one month and pays $540 in Provincial income tax.
What percentage of his income went to provincial income tax?
4. Hope makes $30 210 a year and pays $2 718.90 in Federal income tax. What
percentage of her income went to Federal income tax?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
Edited April 2015
C. How the Government Calculates Federal and Provincial Income Tax
Federal and Provincial taxes are known as progressive or graduated taxes
because the rate you pay increases as your gross wage increases. Rates are
subject to change each year in accordance with federal and provincial
budgets. The rates below are from 2014 tax year.
Discuss the Ideas
Research current year tax rates for both Federal and Provincial Income Tax:
http://www.cra-arc.gc.ca/tx/ndvdls/fq/txrts-eng.html
Federal Income Tax Rates 20__
Income Level
The rate that applies
Provincial Income Tax Rates 20__
Income Level
The rate that applies
C. How the Government Calculates Federal and Provincial Income Tax
Federal and Provincial taxes are known as progressive or graduated taxes
because the rate you pay increases as your gross wage increases. Rates are
subject to change each year in accordance with federal and provincial
budgets. The rates below are from 2014 tax year.
Federal Income Tax Rates 2014
Income Level
The rate that applies
$1 - $43 953
15%
$43 954 to $87 907
22%
$87 908 to $136 270
26%
$136 271 and up
29%
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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Provincial Income Tax Rates 2014
Income Level
The rate that applies
$1 - $43 292
11%
$43 293 to $123 692
13%
$123 692 and up
15%
Using the Provincial Income Tax rates, the following example shows how to
calculate the provincial tax on the graduated scale.
Chang makes $65 891 per year. What percent was taken off in
provincial tax?
Step1:
Calculate 11% of $43 292
$43292 x 0.11 = $4 762.12
Step 2:
$65 891 - $43 292 = $22 599
Step 3:
Calculate 13% of $22 599
$22 599 x 0.13 = $2 937.87
Step 4:
Add together: $4 762.12 + $2 937.87 = $7 699.99
Chang paid $7 699.99 in Provincial Income Tax
Typically, this work is done with an online tax calculator.
D. Online Tax Calculations
Because graduated taxes calculations, many people often use an online
calculator to estimate how much they will pay in taxes. Here is a link to an online
tax calculator:
https://simpletax.ca/calculator
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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2.1D Practice Your Skills Online Tax Calculator
Use an online calculator to answer the following questions:
1. Jake makes $87 900 per year.
a. How much does he pay in federal tax?
b. How much does she pay in provincial tax?
c. What is the total income tax paid?
3. Sonya makes $123 790 per year.
a. How much does she pay in federal tax?
b. How much does she pay in provincial tax?
c. What is the total income tax paid?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
Edited April 2015
E. Canada Pension Plan (CPP)
Canada Pension Plan (CPP) contributions provide you and your dependents
with some financial protection throughout your life (retirement pension as early
as age 60, disability benefits, or survivor benefits). Employees, employers and
the self - employed contribute to the CPP.
•
You pay CPP if you are 18 years of age or older and
make more than $______________.
•
CPP pensionable earnings ceiling is $______________.
•
Contributors who earn more than the $______________
ceiling on pensionable earnings in the year 20____ are
not required or allowed to contribute more to the
CPP.
•
Employee and employer contribution rates for the
year 20___ are _________%. The maximum employee
and employer contribution to the plan will be
$______________.
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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F. Employment Insurance (EI)
Employment Insurance (EI) has no age restriction. Every dollar is insurable. You
can receive regular EI benefits if you lose your job through no fault of your own
(for example, due to shortage of work, seasonal or mass lay-offs) and can't find
work, providing you meet these requirements:
• you must apply
• you have paid into the EI account
• you have been without work and without pay for at least seven
consecutive days
• you have worked for the required number of insurable hours based on
where you live and the unemployment rate in your economic region at
the time of filing your claim for benefits
In some instances, you may need more hours of insurable work to qualify.
For example:
• if you are in the work force for the first time you will need a minimum of
910 hours of insurable work in the last 52 weeks to qualify
• if you are re-entering the work force after an absence of two years, you
are a re-entrant and will, in most instances, need a minimum of 910 hours
of insurable work in the last 52 weeks to qualify
Employment Insurance premium rate for the year 20_____ is $______________ or
______%. As provided in legislation, employers will pay 1.4 times the employee
rate, or $___________ per $100 of employee earnings.
Maximum Insurable Earnings will remain at $____________ for 20_____.
($________/year)
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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2.1Practice Your Skills Deductions
IT SAYS
I SAY
AND SO
1. Frank makes $3211.67
one month. He pays
$457.00 in federal
income tax. What
percentage of his
income went to federal
income tax?
2. Carl makes $979.99 on
his paycheque. If he
pays 12% provincial
income tax, how much
of his income goes to
provincial income tax?
3. Paul makes $5 599.50
one month. He pays
$675.43 in provincial
income tax. What
percentage of his
income went to
provincial income tax?
4. Patricia makes
$1087.65 one month. She
pays $87.00 in
Employment Insurance.
What percentage of her
income went to
Employment Insurance?
5. Gillian makes $9809.19
on her paycheque. If she
pays 21% provincial
income tax, how much
of his income goes to
provincial income tax?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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6. Hugo makes $3027.77
on his paycheque. If he
pays 5% to CPP
(Canada Pension Plan),
how much of his income
goes to CPP?
7. Laurent makes
$4000.35 one month. He
pays $447.00 in union
fees. What percentage
of his income goes to
union fees?
8. Jack makes $6 099.00
one month. He pays
$50.00 in union fees.
What percentage of his
income goes to union
fees?
9. Allison makes $1989.99
on his paycheque. If she
pays 13% provincial
income tax, how much
of her income goes to
provincial income tax?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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2.2 Earnings/Pay Statements
Earnings statements summarize your pay and deductions. Here is a sample pay
statement:
Discuss the Ideas
1. What kind of important information can you find on a pay statement?
2. If you have a job, have you ever seen your pay statement? Where and how
do you access it?
3. Why may you want to regularly look at your pay statement?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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2.2A Practice Your Skills Pay Statement Karla
Below is an earnings statement for Karla.
Earnings Statement
Employee: Karla
Earnings
Description
Regular
Overtime
Total
Hours
80
4
From: 12/1
Rate
$15.00
$22.50
Amount
$1 200.00
$90.00
$1 290.00
Deductions
Description
Federal Tax
Provincial Tax
C.P.P.
E.I.
Total
This Period
To: 12/14
Amount
$180.00
$70.80
$64.39
$47.50
$362.69
YTD
Gross Pay
$1 290.00
$29 670.00
Net Pay
$837.31
$18 505.30
Answer the following questions using Karla’s earnings statement.
Note: A normal day is 8 hours long. YTD refers to Year to Date
1. How much was put into Karla’s Canada Pension Plan this pay period?
2. How much was taken off for E.I. this pay period?
3. How much were Karla’s gross earnings during this pay period?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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4. How much did Karla earn (gross) on an average day, assuming that she
worked a regular work week?
5. How many hours did Karla work during this pay period?
6. How much were her deductions?
7. How much did Karla take home after deductions this pay period?
8. How much was taken for federal tax this pay period?
9. What are Karla’s gross earnings this year so far?
10. What are Karla’s net earnings this year so far?
11. Karla gets time and a half for working overtime. If she works10 hours overtime,
how much gross pay would she receive?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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Show What You Know – Review Assignment
1. Karla gets time and a half for working overtime. If she works10 hours overtime,
how1. Frank makes $3211.67 one month. He pays $457.00 in federal income tax.
What percentage of her income went to federal income tax?
2. Carl makes $979.99 on his paycheque. If he pays 12% provincial income tax,
how much of his income goes to provincial income tax?
3.
Patricia makes $1087.65 one month. She pays $87.00 in Employment Insurance.
What percentage of her income went to Employment Insurance?
4.
Hugo makes $3027.77 on his paycheque. If he pays 5% to CPP (Canada Pension
Plan), how much of his income goes to CPP?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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5.
Complete the earnings statement below and answer the questions on the
next page. Note: A normal day is 8 hours.
Earnings Statement
Employee: Samuel
Earnings
Description
Regular
Overtime
From: 08/1
To: 08/14
Deductions
Description
Federal Tax
Provincial Tax
C.P.P.
E.I.
Total
This Period
Amount
$276.55
$123.78
$80.26
$48.50
__________
YTD
Gross Pay
_____________
$16 589.90
Net Pay
_____________
$12 302.52
Total
Hours
80
6
Rate
$25.00
$37.50
Amount
$2000.00
$225.00
___________
a. What was Samuel’s gross pay for this pay period?
b. What were Samuel’s deductions for this pay period?
c. What was Samuel’s net pay for this pay period?
d. How many hours of overtime did Samuel work during this pay period?
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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e. How much net pay has Samuel made this year?
f. How much more money does Samuel make per hour?
g. How much did Samuel make in overtime during this pay period?
h. What percent was taken off for all deductions? (round to the nearest
percent)
i.
What percent was taken off for federal tax? (round to the nearest percent)
j.
What percent was taken off provincial tax? (round to the nearest percent)
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Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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Student Evaluation
Insufficient
Evidence (IE)
Developing (D)
Growing (G)
Proficient (P)
Exceptional (E)
Student has not
demonstrated the
criteria below.
Student has rarely
demonstrated the
criteria below.
Student has
inconsistently
demonstrated the
criteria below.
Student has
consistently
demonstrated the
criteria below.
Student has consistently
demonstrated the criteria
below. In addition they
have shown their
understanding in novel
situations or at a higher level
of thinking than what is
expected by the criteria.
Proficient Level Criteria
IE
D
G
P
M11.1 Extend understanding of arithmetic operations to rational
numbers to solve problems within the home, money, recreation, and
travel themes.
b. I can use whole numbers, integers, fractions, decimals, and
percents.
c. I can compare and convert among fractions, decimals and
percents.
d. I can round decimals.
e. I understand percents.
f. I can determine if my answer is reasonable.
M11.8 [WA 10.11] Demonstrate understanding of income.
f. I can explain and assess the information provided on pay stubs.
h. I can identify and understand the difference between Provincial,
Federal, and secondary deductions.
i. I can use current data (e.g., federal tax tables) to calculate
deductions.
j. I understand the relationship between gross pay, net pay, and
payroll deductions.
k. I can compare and evaluate different ways of calculating net
pay. (ie. Do I qualify for deductions?)
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E
Book 2: Math 11 Earning and Spending Money - Pay Statements and Deductions
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Learning Log
Date
Starting Point
Ending Point
27