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National Payroll Institute PF1 : Payroll Fundamentals 1Exam

PF1 real exams

Exam Code: PF1

Exam Name: Payroll Fundamentals 1Exam

Updated: Aug 25, 2026

Q & A: 75 Questions and Answers

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National Payroll Institute PF1 Exam Syllabus Topics:

SectionObjectives
Payroll Accounting- Payroll accounting practices
  • 1. Journal entries
  • 2. Payroll reconciliations
Termination of Employment- Termination processing
  • 1. Severance payments
  • 2. Termination pay calculations
Provincial Remittances- Provincial payroll requirements
  • 1. Provincial reporting obligations
  • 2. Provincial payroll taxes
Workers’ Compensation- Workers compensation administration
  • 1. Employer reporting
  • 2. Premium calculations
Non-Regular Payments- Special payroll payments
  • 1. Bonus payments
  • 2. Vacation pay calculations
Employment Income – Allowances, Expenses and Benefits- Taxable and non-taxable benefits
  • 1. Benefit taxation
  • 2. Allowances and reimbursements
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
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
Year-End Processing- Federal and provincial year-end reporting
  • 1. Year-end reconciliations
  • 2. T4 and RL-1 preparation
Federal Remittances- Government remittance obligations
  • 1. CPP and EI remittances
  • 2. Income tax remittances
New Employee Information- Employee setup and documentation
  • 1. Federal and provincial tax forms
  • 2. Payroll records management

National Payroll Institute Payroll Fundamentals 1Exam Sample Questions:

1. Vacation pay on termination would be recorded in which Block(s) on the Record of Employment?

A) Blocks 15B, 15C P.P. 1 and 17A
B) Block 17A only
C) Block 15B only
D) It would not be recorded


2. An employee-employer relationship is deemed to exist when:

A) The employee continues to accrue benefits in the organization's pension plan
B) The employee refuses the right to be recalled to work
C) The employee continues to participate in some of the benefit plans that were available while they were employed
D) There is no expectation of work to be performed by the employee


3. An employee in Ontario was paid a $25,000.00 retiring allowance. The eligible portion was $15,000.00 and was transferred to the employee's Registered Retirement Savings Plan (RRSP) by the employer. Calculate the income tax on the non-eligible portion.

A) $2,000.00
B) $5,000.00
C) $7,250.00
D) $1,000.00


4. An organization pays the premiums for a sickness or accident plan for their president only. This would be considered:

A) A non-cash taxable benefit
B) A taxable allowance
C) None of the above
D) A cash taxable benefit


5. Phillip is being paid a severance payment with his final pay. Which block should this payment be reported on the Record of Employment?

A) Block 15C only
B) Block 17C only
C) Block 15B only
D) Blocks 15B and 17C


Solutions:

Question # 1
Answer: A
Question # 2
Answer: A
Question # 3
Answer: A
Question # 4
Answer: A
Question # 5
Answer: B

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