Getting started with deductions
The first thing you need to do to start using deductions is to set up your deduction categories.
To setup a deduction category:
- Select Payroll Settings, then Deduction Categories.
- To add a new deduction category, select Add. There will already be two deduction categories for you (Pre-Tax Deduction and Post-Tax Deduction). You can edit any of these by selecting the name of the deduction category.
- Enter a name for the deduction category.
- Select whether it will be a pre tax or post tax deduction.
- Add an external ID and select the NMW/NLW Calculation Impact as required.
- Select Save.
Once you have setup your deduction categories, they will now be available to be assigned to employees.
To set up a deduction that recurs indefinitely:
- Go to the employee record for the employee that you want to create the recurring deduction for, and select Pay Run Inclusions.
- Select Add for the deductions you need for the employee, and complete the following details:
- Select the appropriate deduction category from the drop down list.
- Enter the deduction amount to be applied per pay run. It can be a Fixed amount or a Percentage of Gross earnings.
- Select whether the deduction should be paid manually, HMRC or a bank account.
- Select if the preserved earnings should be used from the drop down menu.
- Apply a note if you would like this deduction to have a note attached on the employee's payslip.
- Please state when you want this inclusion to start and when it should expire.
- Select Save.
The next time you process pay run that includes this employee, the deduction will automatically appear.
You can quickly see the status of expiring deductions by going to the employee Pay Run Inclusions screen.
Once you’ve setup your deductions, a summary of the deductions will be displayed which will include:
- The amount or date at which the deduction will expire
- The start date of the deductions
- Whether or not the deduction has actually expired
- For amount based expiries, the current amount that has been paid
- The payment type setup for this deduction