Free Essay

Analysis of Tax Withholding

In: Business and Management

Submitted By goldenpeach
Words 4382
Pages 18
Smith
Consulting

4/16/2010 |

Business 170 – CVS2 - Final Project | Analysis of Current Withholding Tax Policy | Andrea Smith - 7018051 |

Table of Contents

Executive Summary 3
Introduction 4
Analysis and Discussion 5
Recommendation 11
Appendix 1 - Result of Access Query – Annual Management Salaries 12
Appendix 2 - Result of Access Query – Annual Office Wages 13
Appendix 3 - Result of Access Query – Annual Production Wages 14
Appendix 4 - Excel Worksheet – Annual Management Salaries 16
Appendix 5 - Excel Worksheet – Annual Office Wages 17
Appendix 6 - Excel Worksheet – Annual Production Wages 18
Appendix 7 - Excel Worksheet – Employee Tax 20
Appendix 8 – Comparison of Tax Withholding Policy Graphs 24

Executive Summary

This report is a summarization of the results acquired utilizing the current tax withholding policy of Smith Consulting for the 2009 taxation year. It will show the classification of employees into different departments, as well as for the company as a whole, and their annual income as well as the income taxes withheld, and income taxes payable per employee.
This report explains how Excel and Access were utilized to obtain the results as well as including both linked and unlinked copies of the data as appropriate.
The conclusion of the report is a recommendation of how to change the current tax withholding policy to ensure that no employees will have income tax payable, and only management will receive a refund of over $2000.00 in future years.

Introduction
This year Smith Consulting employed 100 people in total. Of the 100 employees, 10 were managers, 20 were in the sales department, 10 were office employees, and 60 were in the production department.
Manager’s salaries ranged from $37,000 to $114,000, office employee’s wage ranged from $9,000 to $10,000, and the production employee’s wages ranged from $9,000 to $13,000. Sales employee’s wages ranged from $800 to $7,000, this is based on commission rate of 40% of sales by employee.
Currently the company’s tax withholding policy allows 30% of Management employees’ annual salary to be withheld while 8% is withheld for all non management employees. At the end of the year, income tax payable by each employee is assessed.
This results in a difference between the tax withheld and the actual income tax payable. While there were no differences between the withheld amount and the actual amount for some employees, a few employees are refunded the difference and a large number of employees, especially in production end up owing tax at the end of the year. Our goal is to change the withholding tax amounts to minimize the differences.

Analysis and Discussion
Tax withholding means that an employer withholds (deducts) amounts from an employee’s gross pay. The amount earned could be for: salary, wages, or commission. These amounts are then paid by the employer to Canada Revenue Agency. The amounts withheld from an employee’s pay by Smith Consulting are called tax withheld. The remaining amount that the employee actually receives is called net pay. Amounts withheld are not a tax on or by the employer; the employer is simply acting as a collection agent and payments are made on behalf of the employee to the Canada Revenue Agency.
The data for each employee is entered into multiple databases in Access. There are a total of 6 original tables containing the information necessary to calculate the annual salary, wage or commission for each employee.
The information is entered into tables as follows: TableName | PrimaryKey | Field Name1 | Field Name 2 | Field Name 3 | Field Name 4 | Employees | Employees | First Name | Last Name | Position ID | | Salaries | Salary ID | Employee ID | Month | Salary | | Sales | Sale ID | Employee ID | Month | Product ID | | Wages | Wage ID | Employee ID | Month | Hours | Rate | Positions | Position ID | Position | | | | Products | Product ID | Item | Price | | |

The “Employees” table contains information on the employee such as name, employee and position identification number. The Employee ID number is used throughout the process to identify employees. The Employee ID is used to link the information in the Employees table to the “Salaries”, “Sales", and “Wages” tables in a one-to-many relationship. The “Positions” table contains the information explaining what position that each position ID number corresponds to.
To the right is a copy of the results of an Access query showing the commission earned by each sales employee for the 2009 sales year. By applying a filter sales employees are separated from other employees based on their position ID. For the year John Great earned $1120.00 in commission while Tina Smallhand earned $9880.00.
To view the results of queries for the annual salaries for management, and the annual wages for office and production employees see Appendices 1-3.
By using Access, payroll was also able to calculate each employee’s gross pay by both individual months and an annual total and place the results in tables according to the positions available at Smith Consulting. This helped to distinguish the hours worked monthly and annually in by the office and production employees as well as the monthly and annual units sold by sales employees.

Above is a copy of a report of the top sales employees for 2009 which was created in Access. From this report it is clearly visible which employees have ranked in the top ten for yearly sales.
With this report the management can quickly determine which sales employees have been the top performers for the year and calculate any applicable bonus that may be awarded. This type of report can also be generated to show the top paid employees in any other position at Smith Consulting.
Below is a copy of the excel worksheet showing the annual commission of the sales employees and a total for all commissions earned for 2009.

As you can see, there are many ways to show the sales employees and their commission earned in Access as well as Excel. To see the Excel versions of the Access queries of annual salaries for management, and the annual wages for office and production employees see Appendices 4-6.
To calculate the income tax payable per employee, a look up table is needed.
This table is then used to calculate the tax rating per employee based on the annual income calculated previously by utilizing a VLookup function in Excel. With this rating the proper amount of tax payable per employee can be calculated. With this amount calculated it can then be determined which employees had sufficient, insufficient or excess tax withheld using the company’s current tax withholding policy of withholding 30% of income for management and 8% for all non management employees. Below is an example of the information calculated as explained in this paragraph. Appendix 7 contains the Excel Employee Tax table in full.
The data can then be used to create a pivot table or a pivot chart to summarize and analyze the data. The use of a pivot chart allows for visualization of the data so comparisons, patterns and efficiency of the current employee payroll tax deductions are easily distinguishable.
Below is a copy of the pivot chart and bar graph showing the number of employees in each position who have a tax amount owing, refunded or had the correct amount withheld.

As you can see clearly, there are many employees owing taxes in the production department. This shows the problem with the current tax withholding policy at Smith Consulting.
Recommendation
Due to the current tax withholding policy of Smith Consulting, the differences between tax withheld and the tax payable in some cases is quite significant. With the current tax withholding policy employees have taxes payable from between $209.00 and $13,324.00. This problem needs to be remedied so fewer employees owe tax at the end of the year. The ideal solution would be to have no employees owe taxes payable and refunds for non management employees should be less than $2000.00 in total.
The main reason for the difference between tax withheld and tax payable is because the production employee’s income ranges from $9,500 to over $13,000 and when this range of income is looked up on the tax rate table it falls into two separate tax brackets of *5 and 10%.
The recommendation for addressing the payroll tax deduction problem at Smith Consulting is to change the tax withheld for all non management employees to 10% from 8%, and changing the tax withheld for all management to 40% from 30%. A simple modification to the current payroll software changing the tax withholding amounts from 8% and 30% to 10% and 40% would eliminate the large number employees with taxes payable at year end.
This change would result in no employees having taxes payable at the end of the year. Of the 90 non management employees at Smith Consulting 55 would have the correct amount of tax withheld and 38 would receive a refund of between $56.00 and $204.00 for the 2009 taxation year. Of the 10 management employees 3 would have the correct amount of tax withheld and 7 would receive a refund of between $3064.00 and $7009.00 for the 2009 taxation year.
The above information is shown in Appendix 8 with a comparison of bar charts for the current tax withholding policy and the recommended change in the policy.

Appendix 1 - Result of Access Query – Annual Management Salaries

EmployeeID | FirstName | LastName | Sum Of Salary | 8 | Rob | Lake | 37905 | 46 | Tina | Magenta | 42395 | 47 | Rob | River | 76614 | 49 | Jay | Great | 81825 | 56 | Tina | Sharpeye | 80239 | 69 | Tina | Great | 109303 | 70 | Jason | Dark | 50063 | 82 | Rob | Smallhand | 133232 | 83 | Jason | Small | 78045 | 100 | Elis | Oak | 114693 |

Appendix 2 - Result of Access Query – Annual Office Wages EmployeeID | FirstName | LastName | Sum Of Monthly Wages | SumOfHours | 7 | Joel | Lake | 9222 | 513 | 23 | Rob | Green | 9613 | 506 | 28 | Darcy | Sharpeye | 9074 | 502 | 35 | Jason | Green | 9083 | 499 | 51 | Mike | Smith | 9639 | 522 | 79 | Joel | Magenta | 9508 | 511 | 84 | Charles | Green | 9069 | 502 | 85 | Janet | Green | 9520 | 518 | 93 | Tina | Lake | 9776 | 536 | 97 | Adam | Smallhand | 9320 | 514 |

Appendix 3 - Result of Access Query – Annual Production Wages EmployeeID | FirstName | LastName | Sum Of Monthly Wage | SumOfHours | 2 | Joel | Grey | 11066 | 552 | 3 | Jason | River | 12239 | 595 | 4 | Adam | Magenta | 9691 | 538 | 5 | Elis | River | 11256 | 558 | 9 | Rob | Grey | 10019 | 546 | 10 | Bob | Lake | 11783 | 569 | 11 | Bob | Block | 11058 | 576 | 12 | Bob | Oak | 10993 | 597 | 14 | Rob | River | 11739 | 578 | 15 | Elis | Smallhand | 11034 | 572 | 16 | Joel | River | 12163 | 583 | 18 | Darcy | Smallhand | 9888 | 555 | 19 | Rob | Grey | 11499 | 566 | 21 | Cecile | Sharpeye | 11983 | 595 | 22 | Bob | Finger | 10484 | 551 | 25 | Joel | White | 10722 | 520 | 26 | Janet | Sharpeye | 11524 | 534 | 29 | Bob | Grey | 10477 | 602 | 30 | Janet | White | 11260 | 581 | 31 | Joel | Oak | 10903 | 543 | 32 | Rob | Magenta | 12142 | 573 | 33 | Janice | Pink | 12160 | 576 | 34 | Fred | Dark | 12485 | 620 | 36 | Darcy | River | 10539 | 525 | 37 | Rob | Grey | 13050 | 619 | 39 | John | Smallhand | 10495 | 531 | 41 | Bob | Finger | 11533 | 558 | 42 | Bob | Grey | 10693 | 527 | 43 | Charles | Sharpeye | 11833 | 589 | 45 | Barb | Smith | 9650 | 511 | 48 | Rob | Finger | 11800 | 572 | 52 | Rob | Smith | 12651 | 627 | 53 | Al | Bigleg | 11998 | 572 | 54 | John | Dark | 11541 | 585 | 55 | Al | Finger | 10629 | 551 | 57 | Janice | Smith | 11680 | 614 | 58 | Rob | Bigleg | 12483 | 577 | 60 | Mike | Grey | 11112 | 584 | 61 | Al | Magenta | 12488 | 599 | 63 | Janice | Lake | 12103 | 577 | 64 | Tina | Great | 13092 | 638 | 65 | Charles | Great | 11626 | 579 | 66 | Jason | Grey | 11411 | 586 | 71 | Rob | White | 11149 | 578 | 72 | Elis | Smith | 11661 | 591 | 73 | Tina | Magenta | 10581 | 534 | 74 | Mike | Dark | 11804 | 604 | 75 | Darcy | Dark | 10192 | 526 | 76 | Janet | Small | 11103 | 584 | 77 | Fred | Small | 11264 | 566 | 80 | Adam | Magenta | 10971 | 556 | 81 | Barb | Smith | 10592 | 555 | 86 | John | Lake | 10902 | 576 | 87 | Darcy | River | 11823 | 598 | 90 | Bob | Grey | 10527 | 544 | 91 | Charles | Lake | 12887 | 595 | 92 | Rob | Green | 11328 | 575 | 94 | Mike | Pale | 12248 | 596 | 95 | Joel | Pale | 10627 | 545 | 99 | Darcy | Pale | 11556 | 577 |

Appendix 4 - Excel Worksheet – Annual Management Salaries

Appendix 5 - Excel Worksheet – Annual Office Wages

Appendix 6 - Excel Worksheet – Annual Production Wages Annual Wages of Production Employees | | | | | | EmployeeID | FirstName | LastName | Sum Of Monthly Wage | SumOfHours | 2 | Joel | Grey | $11,066.00 | 552 | 3 | Jason | River | $12,239.00 | 595 | 4 | Adam | Magenta | $9,691.00 | 538 | 5 | Elis | River | $11,256.00 | 558 | 9 | Rob | Grey | $10,019.00 | 546 | 10 | Bob | Lake | $11,783.00 | 569 | 11 | Bob | Block | $11,058.00 | 576 | 12 | Bob | Oak | $10,993.00 | 597 | 14 | Rob | River | $11,739.00 | 578 | 15 | Elis | Smallhand | $11,034.00 | 572 | 16 | Joel | River | $12,163.00 | 583 | 18 | Darcy | Smallhand | $9,888.00 | 555 | 19 | Rob | Grey | $11,499.00 | 566 | 21 | Cecile | Sharpeye | $11,983.00 | 595 | 22 | Bob | Finger | $10,484.00 | 551 | 25 | Joel | White | $10,722.00 | 520 | 26 | Janet | Sharpeye | $11,524.00 | 534 | 29 | Bob | Grey | $10,477.00 | 602 | 30 | Janet | White | $11,260.00 | 581 | 31 | Joel | Oak | $10,903.00 | 543 | 32 | Rob | Magenta | $12,142.00 | 573 | 33 | Janice | Pink | $12,160.00 | 576 | 34 | Fred | Dark | $12,485.00 | 620 | 36 | Darcy | River | $10,539.00 | 525 | 37 | Rob | Grey | $13,050.00 | 619 | 39 | John | Smallhand | $10,495.00 | 531 | 41 | Bob | Finger | $11,533.00 | 558 | 42 | Bob | Grey | $10,693.00 | 527 | 43 | Charles | Sharpeye | $11,833.00 | 589 | 45 | Barb | Smith | $9,650.00 | 511 | 48 | Rob | Finger | $11,800.00 | 572 | 52 | Rob | Smith | $12,651.00 | 627 | 53 | Al | Bigleg | $11,998.00 | 572 | 54 | John | Dark | $11,541.00 | 585 | 55 | Al | Finger | $10,629.00 | 551 | 57 | Janice | Smith | $11,680.00 | 614 | 58 | Rob | Bigleg | $12,483.00 | 577 | 60 | Mike | Grey | $11,112.00 | 584 | 61 | Al | Magenta | $12,488.00 | 599 | 63 | Janice | Lake | $12,103.00 | 577 | 64 | Tina | Great | $13,092.00 | 638 | 65 | Charles | Great | $11,626.00 | 579 | 66 | Jason | Grey | $11,411.00 | 586 | 71 | Rob | White | $11,149.00 | 578 | 72 | Elis | Smith | $11,661.00 | 591 | 73 | Tina | Magenta | $10,581.00 | 534 | 74 | Mike | Dark | $11,804.00 | 604 | 75 | Darcy | Dark | $10,192.00 | 526 | 76 | Janet | Small | $11,103.00 | 584 | 77 | Fred | Small | $11,264.00 | 566 | 80 | Adam | Magenta | $10,971.00 | 556 | 81 | Barb | Smith | $10,592.00 | 555 | 86 | John | Lake | $10,902.00 | 576 | 87 | Darcy | River | $11,823.00 | 598 | 90 | Bob | Grey | $10,527.00 | 544 | 91 | Charles | Lake | $12,887.00 | 595 | 92 | Rob | Green | $11,328.00 | 575 | 94 | Mike | Pale | $12,248.00 | 596 | 95 | Joel | Pale | $10,627.00 | 545 | 99 | Darcy | Pale | $11,556.00 | 577 | Total | 60 | | $682,190.00 | |

Appendix 7 - Excel Worksheet – Employee Tax EmployeeID | FirstName | LastName | Position | Hours Worked | Salary/Wage/Commission | Tax | Salary Withheld | Tax Withheld | Tax State | Tax Owing/Refund Amount | 1 | Cecile | Grey | Sales | | $6,280.00 | $502.40 | 8% | $502.40 | Even | $0.00 | 2 | Joel | Grey | Production | 552 | $11,066.00 | $1,106.60 | 8% | $885.28 | Owing | $221.32 | 3 | Jason | River | Production | 595 | $12,239.00 | $1,223.90 | 8% | $979.12 | Owing | $244.78 | 4 | Adam | Magenta | Production | 538 | $9,691.00 | $775.28 | 8% | $775.28 | Even | $0.00 | 5 | Elis | River | Production | 558 | $11,256.00 | $1,125.60 | 8% | $900.48 | Owing | $225.12 | 6 | Tina | Smallhand | Sales | | $9,880.00 | $790.40 | 8% | $790.40 | Even | $0.00 | 7 | Joel | Lake | Office | 513 | $9,222.00 | $737.76 | 8% | $737.76 | Even | $0.00 | 8 | Rob | Lake | Manager | | $37,905.00 | $9,855.30 | 30% | $11,371.50 | Refund | $1,516.20 | 9 | Rob | Grey | Production | 569 | $10,019.00 | $801.52 | 8% | $801.52 | Even | $0.00 | 10 | Bob | Lake | Production | 573 | $11,783.00 | $1,178.30 | 8% | $942.64 | Owing | $235.66 | 11 | Bob | Block | Production | 576 | $11,058.00 | $1,105.80 | 8% | $884.64 | Owing | $221.16 | 12 | Bob | Oak | Production | 597 | $10,993.00 | $1,099.30 | 8% | $879.44 | Owing | $219.86 | 13 | Janice | Dark | Sales | | $7,004.00 | $560.32 | 8% | $560.32 | Even | $0.00 | 14 | Rob | River | Production | 578 | $11,739.00 | $1,173.90 | 8% | $939.12 | Owing | $234.78 | 15 | Elis | Smallhand | Production | 572 | $11,034.00 | $1,103.40 | 8% | $882.72 | Owing | $220.68 | 16 | Joel | River | Production | 583 | $12,163.00 | $1,216.30 | 8% | $973.04 | Owing | $243.26 | 17 | Darcy | Finger | Sales | | $6,508.00 | $520.64 | 8% | $520.64 | Even | $0.00 | 18 | Darcy | Smallhand | Production | 555 | $9,888.00 | $791.04 | 8% | $791.04 | Even | $0.00 | 19 | Rob | Grey | Production | 566 | $11,499.00 | $1,149.90 | 8% | $919.92 | Owing | $229.98 | 20 | Cecile | Great | Sales | | $6,268.00 | $501.44 | 8% | $501.44 | Even | $0.00 | 21 | Cecile | Sharpeye | Production | 595 | $11,983.00 | $1,198.30 | 8% | $958.64 | Owing | $239.66 | 22 | Bob | Finger | Production | 551 | $10,484.00 | $1,048.40 | 8% | $838.72 | Owing | $209.68 | 23 | Rob | Green | Office | 506 | $9,613.00 | $769.04 | 8% | $769.04 | Even | $0.00 | 24 | Janice | Smallhand | Sales | | $7,120.00 | $569.60 | 8% | $569.60 | Even | $0.00 | 25 | Joel | White | Production | 520 | $10,722.00 | $1,072.20 | 8% | $857.76 | Owing | $214.44 | 26 | Janet | Sharpeye | Production | 534 | $11,524.00 | $1,152.40 | 8% | $921.92 | Owing | $230.48 | 27 | Jay | Small | Sales | | $8,108.00 | $648.64 | 8% | $648.64 | Even | $0.00 | 28 | Darcy | Sharpeye | Office | 502 | $9,074.00 | $725.92 | 8% | $725.92 | Even | $0.00 | 29 | Bob | Grey | Production | 602 | $10,477.00 | $1,047.70 | 8% | $838.16 | Owing | $209.54 | 30 | Janet | White | Production | 581 | $11,260.00 | $1,126.00 | 8% | $900.80 | Owing | $225.20 | 31 | Joel | Oak | Production | 543 | $10,903.00 | $1,090.30 | 8% | $872.24 | Owing | $218.06 | 32 | Rob | Magenta | Production | 573 | $12,142.00 | $1,214.20 | 8% | $971.36 | Owing | $242.84 | 33 | Janice | Pink | Production | 576 | $12,160.00 | $1,216.00 | 8% | $972.80 | Owing | $243.20 | 34 | Fred | Dark | Production | 620 | $12,485.00 | $1,248.50 | 8% | $998.80 | Owing | $249.70 | 35 | Jason | Green | Office | 499 | $9,083.00 | $726.64 | 8% | $726.64 | Even | $0.00 | 36 | Darcy | River | Production | 525 | $10,539.00 | $1,053.90 | 8% | $843.12 | Owing | $210.78 | 37 | Rob | Grey | Production | 619 | $13,050.00 | $1,305.00 | 8% | $1,044.00 | Owing | $261.00 | 38 | John | Great | Sales | | $1,120.00 | $56.00 | 8% | $89.60 | Refund | $33.60 | 39 | John | Smallhand | Production | 531 | $10,495.00 | $1,049.50 | 8% | $839.60 | Owing | $209.90 | 40 | Tina | Dark | Sales | | $8,548.00 | $683.84 | 8% | $683.84 | Even | $0.00 | 41 | Bob | Finger | Production | 558 | $11,533.00 | $1,153.30 | 8% | $922.64 | Owing | $230.66 | 42 | Bob | Grey | Production | 527 | $10,693.00 | $1,069.30 | 8% | $855.44 | Owing | $213.86 | 43 | Charles | Sharpeye | Production | 589 | $11,833.00 | $1,183.30 | 8% | $946.64 | Owing | $236.66 | 44 | Charles | Dark | Sales | | $3,780.00 | $189.00 | 8% | $302.40 | Refund | $113.40 | 45 | Barb | Smith | Production | 511 | $9,650.00 | $772.00 | 8% | $772.00 | Even | $0.00 | 46 | Tina | Magenta | Manager | | $42,395.00 | $11,022.70 | 30% | $12,718.50 | Refund | $1,695.80 | 47 | Rob | River | Manager | | $76,614.00 | $27,581.04 | 30% | $22,984.20 | Owing | $4,596.84 | 48 | Rob | Finger | Production | 572 | $11,800.00 | $1,180.00 | 8% | $944.00 | Owing | $236.00 | 49 | Jay | Great | Manager | | $81,825.00 | $29,457.00 | 30% | $24,547.50 | Owing | $4,909.50 | 50 | Al | Dark | Sales | | $9,136.00 | $730.88 | 8% | $730.88 | Even | $0.00 | 51 | Mike | Smith | Office | 522 | $9,639.00 | $771.12 | 8% | $771.12 | Even | $0.00 | 52 | Rob | Smith | Production | 627 | $12,651.00 | $1,265.10 | 8% | $1,012.08 | Owing | $253.02 | 53 | Al | Bigleg | Production | 572 | $11,998.00 | $1,199.80 | 8% | $959.84 | Owing | $239.96 | 54 | John | Dark | Production | 585 | $11,541.00 | $1,154.10 | 8% | $923.28 | Owing | $230.82 | 55 | Al | Finger | Production | 551 | $10,629.00 | $1,062.90 | 8% | $850.32 | Owing | $212.58 | 56 | Tina | Sharpeye | Manager | | $80,239.00 | $28,886.04 | 30% | $24,071.70 | Owing | $4,814.34 | 57 | Janice | Smith | Production | 614 | $11,680.00 | $1,168.00 | 8% | $934.40 | Owing | $233.60 | 58 | Rob | Bigleg | Production | 577 | $12,483.00 | $1,248.30 | 8% | $998.64 | Owing | $249.66 | 59 | Albert | River | Sales | | $9,360.00 | $748.80 | 8% | $748.80 | Even | $0.00 | 60 | Mike | Grey | Production | 584 | $11,112.00 | $1,111.20 | 8% | $888.96 | Owing | $222.24 | 61 | Al | Magenta | Production | 599 | $12,488.00 | $1,248.80 | 8% | $999.04 | Owing | $249.76 | 62 | Mike | Block | Sales | | $7,228.00 | $578.24 | 8% | $578.24 | Even | $0.00 | 63 | Janice | Lake | Production | 577 | $12,103.00 | $1,210.30 | 8% | $968.24 | Owing | $242.06 | 64 | Tina | Great | Production | 638 | $13,092.00 | $1,309.20 | 8% | $1,047.36 | Owing | $261.84 | 65 | Charles | Great | Production | 579 | $11,626.00 | $1,162.60 | 8% | $930.08 | Owing | $232.52 | 66 | Jason | Grey | Production | 586 | $11,411.00 | $1,141.10 | 8% | $912.88 | Owing | $228.22 | 67 | Jay | Pink | Sales | | $6,444.00 | $515.52 | 8% | $515.52 | Even | $0.00 | 68 | Fred | Block | Sales | | $7,876.00 | $630.08 | 8% | $630.08 | Even | $0.00 | 69 | Tina | Great | Manager | | $109,303.00 | $43,721.20 | 30% | $32,790.90 | Owing | $10,930.30 | 70 | Jason | Dark | Manager | | $50,063.00 | $13,016.38 | 30% | $15,018.90 | Refund | $2,002.52 | 71 | Rob | White | Production | 578 | $11,149.00 | $1,114.90 | 8% | $891.92 | Owing | $222.98 | 72 | Elis | Smith | Production | 591 | $11,661.00 | $1,166.10 | 8% | $932.88 | Owing | $233.22 | 73 | Tina | Magenta | Production | 534 | $10,581.00 | $1,058.10 | 8% | $846.48 | Owing | $211.62 | 74 | Mike | Dark | Production | 604 | $11,804.00 | $1,180.40 | 8% | $944.32 | Owing | $236.08 | 75 | Darcy | Dark | Production | 526 | $10,192.00 | $815.36 | 8% | $815.36 | Even | $0.00 | 76 | Janet | Small | Production | 584 | $11,103.00 | $1,110.30 | 8% | $888.24 | Owing | $222.06 | 77 | Fred | Small | Production | 566 | $11,264.00 | $1,126.40 | 8% | $901.12 | Owing | $225.28 | 78 | Janice | Small | Sales | | $9,080.00 | $726.40 | 8% | $726.40 | Even | $0.00 | 79 | Joel | Magenta | Office | 511 | $9,508.00 | $760.64 | 8% | $760.64 | Even | $0.00 | 80 | Adam | Magenta | Production | 556 | $10,971.00 | $1,097.10 | 8% | $877.68 | Owing | $219.42 | 81 | Barb | Smith | Production | 555 | $10,592.00 | $1,059.20 | 8% | $847.36 | Owing | $211.84 | 82 | Rob | Smallhand | Manager | | $133,232.00 | $53,292.80 | 30% | $39,969.60 | Owing | $13,323.20 | 83 | Jason | Small | Manager | | $78,045.00 | $28,096.20 | 30% | $23,413.50 | Owing | $4,682.70 | 84 | Charles | Green | Office | 502 | $9,069.00 | $725.52 | 8% | $725.52 | Even | $0.00 | 85 | Janet | Green | Office | 518 | $9,520.00 | $761.60 | 8% | $761.60 | Even | $0.00 | 86 | John | Lake | Production | 576 | $10,902.00 | $1,090.20 | 8% | $872.16 | Owing | $218.04 | 87 | Darcy | River | Production | 598 | $11,823.00 | $1,182.30 | 8% | $945.84 | Owing | $236.46 | 88 | Bob | Pale | Sales | | $7,724.00 | $617.92 | 8% | $617.92 | Even | $0.00 | 89 | Cecile | Pink | Sales | | $8,064.00 | $645.12 | 8% | $645.12 | Even | $0.00 | 90 | Bob | Grey | Production | 544 | $10,527.00 | $1,052.70 | 8% | $842.16 | Owing | $210.54 | 91 | Charles | Lake | Production | 595 | $12,887.00 | $1,288.70 | 8% | $1,030.96 | Owing | $257.74 | 92 | Rob | Green | Production | 575 | $11,328.00 | $1,132.80 | 8% | $906.24 | Owing | $226.56 | 93 | Tina | Lake | Office | 536 | $9,776.00 | $782.08 | 8% | $782.08 | Even | $0.00 | 94 | Mike | Pale | Production | 596 | $12,248.00 | $1,224.80 | 8% | $979.84 | Owing | $244.96 | 95 | Joel | Pale | Production | 545 | $10,627.00 | $1,062.70 | 8% | $850.16 | Owing | $212.54 | 96 | Joel | Magenta | Sales | | $8,560.00 | $684.80 | 8% | $684.80 | Even | $0.00 | 97 | Adam | Smallhand | Office | 514 | $9,320.00 | $745.60 | 8% | $745.60 | Even | $0.00 | 98 | Adam | Green | Sales | | $6,692.00 | $535.36 | 8% | $535.36 | Even | $0.00 | 99 | Darcy | Pale | Production | 577 | $11,556.00 | $1,155.60 | 8% | $924.48 | Owing | $231.12 | 100 | Elis | Oak | Manager | | $114,693.00 | $45,877.20 | 30% | $34,407.90 | Owing | $11,469.30 |

Appendix 8 – Comparison of Tax Withholding Policy Graphs
Withholding Tax:
Management - 30% and Non Management – 8%

Withholding Tax:
Management - 40% and Non Management – 10%

--------------------------------------------
[ 1 ]. Income taxes payable is assessed based on annual salary at a rate of between from 5% to 40%.
[ 2 ]. The total amount earned by an employee.
[ 3 ]. A fixed amount of pay per period that is not determined by hours worked. At Smith Consulting salaries are earned by managers.
[ 4 ]. An amount that is determined by hours of work multiplied by an hourly rate. At Smith Consulting office and production employees are paid in this manner
[ 5 ]. Refers to amount of commission paid per sale by an employee. Smith Consulting pays a 40% commission.
[ 6 ]. In this relationship, a row in the “Employees” table has many matching row is the “Salaries”, “Sales”, and “Wages” tables but a row in each of the “Salaries”, “Sales”, and “Wages” tables can only have one matching row in the “Employees” table.
[ 7 ]. Each position in the company is assigned a Position ID, the position ID from sales is the number 2
[ 8 ]. Management, Office, Production and Sales
[ 9 ]. VLookup stands for vertical look up. This searches Salary/Wage/Commission column in the Employee Tax table and applies the correct tax rate (between 5% and 40%) which is stated in the second column of the Tax Rating table based on the income range stated in the first column of the Tax Rating table.

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