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National Payroll Institute Payroll Fundamentals PF1

PF1

Exam Code: PF1

Exam Name: Payroll Fundamentals 1Exam

Updated: Oct 16, 2026

Q & A: 75 Questions and Answers

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National Payroll Institute PF1 Exam Syllabus Topics:

SectionObjectives
Termination of Employment- Termination processing
  • 1. Severance payments
  • 2. Termination pay calculations
Year-End Processing- Federal and provincial year-end reporting
  • 1. T4 and RL-1 preparation
  • 2. Year-end reconciliations
Non-Regular Payments- Special payroll payments
  • 1. Vacation pay calculations
  • 2. Bonus payments
Provincial Remittances- Provincial payroll requirements
  • 1. Provincial payroll taxes
  • 2. Provincial reporting obligations
Federal Remittances- Government remittance obligations
  • 1. CPP and EI remittances
  • 2. Income tax remittances
Workers’ Compensation- Workers compensation administration
  • 1. Premium calculations
  • 2. Employer reporting
Employment Income – Allowances, Expenses and Benefits- Taxable and non-taxable benefits
  • 1. Allowances and reimbursements
  • 2. Benefit taxation
New Employee Information- Employee setup and documentation
  • 1. Federal and provincial tax forms
  • 2. Payroll records management
Non-Statutory Deductions- Voluntary deductions
  • 1. Union dues
  • 2. Benefit premiums
Commission Payments- Commission payroll processing
  • 1. Commission earnings calculations
  • 2. Tax treatment of commissions
Payroll Accounting- Payroll accounting practices
  • 1. Journal entries
  • 2. Payroll reconciliations
Record of Employment- ROE processing
  • 1. Electronic filing
  • 2. ROE completion requirements
Employment Income – Regular Earnings- Regular payroll calculations
  • 1. Salary and hourly wage calculations
  • 2. Overtime calculations

National Payroll Institute Payroll Fundamentals 1Exam Sample Questions:

Question #1
Anthony earns $750.00 per week. He has a cash taxable benefit of $25.00 per week. Anthony is exempt from CPP contributions. Calculate the net taxable income for the week.


Question #2
Ursula is 17 years old, works in Quebec and earns $750.00 weekly. Ursula pays weekly union dues of $18.00 along with a special weekly union assessment of $10.00 for construction of a new union hall for its members.
Ursula also has registered pension plan (RPP) contributions of $20.00 deducted from each pay. Calculate Ursula's net federal taxable income.


Question #3
The source deductions form completed by all new employees in Quebec is called:

A. T1213
B. T2222
C. TP-1015.3-V
D. TD1-AB


Question #4
Which statutory deductions is salary continuance subject to?

A. All deductions
B. All deductions except Employment Insurance premiums
C. All deductions except Employment Insurance and Quebec Parental Insurance Plan premiums
D. All deductions except Quebec Parental Insurance Plan premiums


Question #5
Michael is an employee in Alberta who is paid bi-weekly and earns $1,600.00 per pay period. He has a taxable meal allowance of $30.00 per pay period. His federal and provincial TD1s on file show a claim code
2. Michael already reached the annual maximum first and second Canada Pension Plan (CPP) contributions before this pay. Calculate his total federal and provincial income taxes.


Solutions:

Question #1
Correct Answer: Only visible for members
Question #2
Correct Answer: Only visible for members
Question #3
Correct Answer: C
Question #4
Correct Answer: A
Question #5
Correct Answer: Only visible for members

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