National Payroll Institute PF1 Exam : Payroll Fundamentals 1Exam

  • Exam Code: PF1
  • Exam Name: Payroll Fundamentals 1Exam
  • Updated: Oct 07, 2026
  • Q & A: 75 Questions and Answers

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National Payroll Institute PF1 Exam Syllabus Topics:

SectionWeightObjectives
Individual Pay Calculations40%- Regular earnings
  • 1. Hourly, salary, commission calculations
    • 2. Pay period types and frequency
      - Non-regular earnings
      • 1. Allowances, taxable benefits
        • 2. Overtime, bonuses, retroactive pay
          Termination and Special Payments30%- Termination payments
          • 1. Retiring allowances, death benefits
            • 2. Wages in lieu of notice, severance pay
              - Leaves and absences
              • 1. Vacation pay, statutory holidays
                • 2. Sick leave, maternity/parental leave payments
                  Communication and Compliance10%- Accuracy and documentation
                  • 1. Record keeping and audit trails
                    - Stakeholder communication
                    • 1. Employee, government, third-party requirements
                      Record of Employment (ROE)20%- Submission and deadlines
                      • 1. Electronic vs paper filing
                        - ROE completion requirements
                        • 1. Insurable/pensionable earnings reporting
                          • 2. Block-by-block reporting rules

                            National Payroll Institute Payroll Fundamentals 1Exam Sample Questions:

                            Question #1

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

                            • A. None of the above
                            • B. A taxable allowance
                            • C. A non-cash taxable benefit
                            • D. A cash taxable benefit
                            Reveal Solution  Discussion  0

                            Correct Answer: C  🗳️

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                            Question #2

                            Bonus and incentive pays are subject to which statutory deductions?

                            • A. Canada/Quebec Pension Plan contributions, Employment Insurance and Quebec Parental Insurance Plan premiums, income taxes and Northwest Territories/Nunavut payroll taxes
                            • B. Employment Insurance and Quebec Parental Insurance Plan premiums and Northwest Territories
                              /Nunavut payroll taxes
                            • C. Canada/Quebec Pension Plan contributions, Quebec Parental Insurance Plan premiums, income taxes and Northwest Territories/Nunavut payroll taxes
                            • D. Canada/Quebec Pension Plan contributions, Employment Insurance premiums and income taxes
                            Reveal Solution  Discussion  0

                            Correct Answer: A  🗳️

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                            Question #3

                            When is the government-prescribed rate of interest set?

                            • A. The first of each month
                            • B. Annually
                            • C. Each calendar quarter
                            • D. Semi-annually
                            Reveal Solution  Discussion  0

                            Correct Answer: C  🗳️

                            Explanation: Only visible for VCEEngine members. You can sign-up / login (it's free).

                            Question #4

                            The deduction for living in a prescribed zone can be claimed by residents of which jurisdictions?

                            • A. Northwest Territories, Nunavut and Yukon
                            • B. New Brunswick, Newfoundland and Labrador, Nova Scotia and Prince Edward Island
                            • C. All Canadian provinces and territories
                            • D. Alberta, Saskatchewan and Manitoba
                            Reveal Solution  Discussion  0

                            Correct Answer: C  🗳️

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                            Question #5

                            The formula for calculating net pay is:

                            • A. Gross earnings minus total tax
                            • B. Pensionable earnings minus total deductions
                            • C. Gross earnings minus total deductions
                            • D. Net taxable income minus total deductions
                            Reveal Solution  Discussion  0

                            Correct Answer: C  🗳️

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