I believe that the correct way to do this with a pure wax ring is to set the ring on the horn of the toilet. The horn is the conical part that is the back end of the "S" trap moled inside the toilet and that goes on top of the floor flange.
With the plactic lined wax rings, installation is the reverse. You might want to check the box that the flange came in or the packaging that the ring itself came in to be sure whichj is correct for your wax ring. In either case, you do want to remove the big majority of the old wax from whereever it was with a putty knife before you put the toilet into position.