Adding and Updating Deductions (Gross Pay Country)

A payee may request, or may be obligated, to have deductions taken from their gross or net pay. Where this is the case, the relevant deductions must be added to the Payee record so that the relevant deduction amounts will be automatically deducted from the payee’s earnings at the Gross Deductions and/or Net Deductions stages of a pay batch.

A payee's deductions can be added, viewed and modified via the Portal > Payee > Payee Maintenance > Payee Entry > Deductions section.

The following types of deductions can be applied to a payee:

standard

Deductions cannot be added, edited or deleted while a payee is included in an open pay batch. However, if you need to add a deduction while the payee is included in an open pay batch you can add an ad-hoc deduction to the payee's pay details within the pay batch.

Deductions that have already been used in a pay batch cannot be deleted because the system needs to retain a history of what affected a payee's pay for each pay period. Similarly, a deduction cannot be edited once it has been used in a pay batch except for its validity end date, which can be set or changed to determine when the deduction is to cease.

When adding a payee deduction, you must specify the following:

the deduction header to which the deduction is linked
the validity period of the deduction
an optional end date on which the deduction is to cease being applied
the applicable rate type
the rate value
whether the deduction is taken from gross or net earnings (depending on whether this is permitted against the payee's deduction or controlled at the deduction header)
whether the deduction is a rolling deduction
whether the deduction is net protected
an optional payee account reference.

Deduction Headers

The deduction header to which a deduction is linked determines a number of attributes of the deduction such as the deduction type, whether the deduction can be taken at gross or net earnings at the payee level and the bank account into which the deduction is to be paid.

When you add a deduction to a Payee record you must link the deduction to a deduction header. The deduction header defines certain attributes of the deduction such as the deduction type whether the deduction can be taken at gross or net earnings at the payee level and the bank account into which the deduction is to be paid. Therefore, it is important to ensure that you link a payee deduction to the correct deduction header.

Note:

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The relevant deduction headers must be configured under Portal > Pay > Maintenance > Deduction Header before you can add payee deductions

Deduction Validity Period

A deduction must have a validity period that determines when the deduction is applicable. The validity period is defined by a mandatory start date and an optional end date. If an end date is not defined the deduction will be applied indefinitely from the start date onwards. An end date can be set at any time after the deduction is created except while a payee is included in an open pay batch.

A deduction is automatically applied in a pay batch if it is valid on the end date of the pay period to which the pay batch corresponds. That is, the pay period end date of the pay batch must fall within the validity start and end dates of the deduction.

Rate Type & Rate Value

The rate type determines whether the deduction is to be deducted as a fixed amount (for example: £100.00 per pay period) or a percentage of the payee's earnings (for example: 5% of earnings per pay period). If the rate type is percentage based, you must specify if the deduction is calculated based on a percentage of the payee's gross or net earnings.
The rate value specifies the fixed monetary amount or percentage that is to be deducted from the payee's pay per pay period.

Because a payee can be included in multiple pay batches for the same pay period, the system takes into account any prior deductions made during the same pay period. For example, if a payee requires £100 to be deducted from their pay each pay period and the entire £100 deduction is applied in the first pay batch that is processed for a given pay period, that deduction is not applied again if the payee is included in another pay batch for the same pay period. However, if the deduction was based on 2% of earnings (gross or net) rather than a fixed amount, the deduction will be applied each time the payee has any earnings in a pay batch so that the total amount deducted during a given pay period will equal 2% of the payee’s total earnings for the pay period.

Rolling Deductions

A deduction must be flagged as a rolling deduction if the deduction is to cease once a specified total amount has been deducted from the payee's pay.

Rolling deductions are useful in situations where a payee is required to repay an amount and the repayment is made in a series of instalments. The deduction is applied to automatically to deduct the relevant instalment amount each pay period and once the total amount is reached the rolling deduction ceases automatically.

Payee Account Reference

Bank account details that are specified on the deduction header to which a deduction is linked identify the bank account into which a deduction is paid if payment is facilitated via electronic funds transfer (EFT).

These bank account details can include a generic account reference that identifies the source of the payment. It is also possible to define an account reference on an individual payee deduction if a deduction payment needs to be identifiable down to the individual payee level. For example, if a payee has union fees deducted from their pay it may be necessary to include a unique payee ID in the account reference to identify the individual payee on whose behalf a payment is made when the deducted money is transferred to the union’s bank account.

It is not mandatory to define an account reference on a payee deduction and if not defined, the generic account reference that is defined on the linked deduction header is used to identify the source of deduction payments instead.

How to Add a Deduction

To add a deduction to a payee, follow the procedure below.

How to Add a Deduction
1.	If you do not have the relevant payee record open in the Payee Entry screen, use the Payroll > Payee screen to search for and open the relevant payee record.
2.	On the Payee Entry screen, scroll down to the Deductions section or click on the Quick Link.
3.	Click Add. The option to add a new deduction is unavailable if the payee is currently included in an open pay batch or has already been paid for the corresponding payee details validity period. The Deduction Details screen opens.
4.	Next to the Validity Start Date field, click the calendar control to select the date or type the date after which the deduction ceases to be effective.
5.	Next to the Validity Start End field, click the calendar control to select the date or type the date after which the deduction ceases to be effective. Skip this step if the deduction is to remain effective indefinitely.
6.	In the Rate Type field, select Percent if the rate of the deduction will be specified as a percentage of the payee's gross or net earnings or select Fixed if the deduction rate will be specified as a fixed monetary value.
7.	In the Rate Value field, key in the percentage of fixed amount that is to be deducted from the payee's earning per pay period depending on whether the applicable rate type is Percent or Fixed respectively.
8.	In the Deduction field, select the name of the deduction that is to be added. This identifies the deduction header to which the payee's deduction will be linked. The Deduction Type* field is automatically displays the deduction type that applies to the selected deduction.*
9.	In the Deduct From field, select Net if the deduction is to be from the payee's net earnings or select Gross if the deduction is to be from the payee's gross earnings. If the Deduction Header setting Allow to override the deduct from on payee is unchecked, this is a display field and will show the Deduct From setting against the deduction header.
10.	If the Rate Type is set to Fixed, skip this step. In the Calculate On field, select Net if the deduction amount is to be calculated based on a percentage of the payee's net earnings per pay period or select Gross if the deduction amount is to be calculated based on a percentage of the payee's gross earnings per pay period.
11.	In the Payee Account Reference field, key in the payee's unique account reference that will be used to identify deduction payments made as a result of this deduction if necessary. Otherwise, leave this field blank if a generic account reference is to be used from the deduction header instead.
12.	If the deduction is to be a rolling deduction, specifying the total amount to be deducted over the course of successive pay periods on the Rolling Deductions tab. For more information, see How to Configure a Rolling Deduction below.
15.	The Net Protected tab is available for version 11.40 and 11.41 but UK specific legislation regarding Child Support and Court Orders is still pending development.
16.	Click Save. The Deduction Details screen closes and a new deduction is created and displayed in the list in the Deduction* section of the Payee Entry screen.*

How to Configure a Rolling Deduction

To configure a rolling deduction, follow the procedure below.

How to Configure a Rolling Deduction
1.	On the Deduction Details screen, click the Rolling Deduction tab if it is not already activated. For more information about how to display the Deduction Details screen, see How to Add a Deduction above.
2.	On the Rolling Deduction tab, click Rolling Deduction. A tick appears in the checkbox and a Total Amount* and Outstanding Amount field is activated*.
3.	In the Total Amount field, key in the total monetary amount that is to be deducted from the payee's earnings over the course of successive pay periods.
4.	Click on the Outstanding Amount field. The Outstanding Amount field automatically displays the amount you keyed into the Total Amount field to indicate that the monetary amount that remains to be deducted by the rolling deduction.
5.	Specify any other deduction details as required and close the Deduction Details screen (for more information, see How to Add a Deduction above.).

How to Configure a Net Protected Deduction

To configure a net protected deduction, follow the procedure below.

A deduction cannot be net protected unless the deduction is configured to deduct money from the payee’s net earnings.

How to Configure a Net Protected Deduction
1.	On the Deduction Details screen, click the Net Protected Deduction tab if it is not already activated. For more information about how to display the Deduction Details screen, see How to Add a Deduction above.
2.	On the Net Protected tab, click Net Protected. A tick appears in the checkbox and a Protected Type* and Protected Rate field is activated*.
3.	In the Protected Type field, select Percent if the net protected amount is to be defined as a percentage of the payee's net pay for a pay period or select Fixed if the net protected amount is to be a fixed monetary amount per pay period.
4.	In the Protected Rate field, key in the net protected percentage or net protected amount that is to apply per pay period, depending on whether the protected type is Percent or Fixed respectively. For example, if the protected type is Percent and the payee is to retain at least 60% of their net pay in each pay period after the deduction is applied, key in 60. If the protected type is Fixed and the payee is to retain at least $1500 net in each pay period after the deduction is applied, key in 1500.
5.	Specify any other deduction details as required and close the Deduction Details screen (for more information, see How to Add a Deduction above).

How to View or Edit an Existing Deduction

To view or Edit a payee's existing deduction, follow the procedure below.

You cannot modify a deduction if the payee is currently included in an open pay batch or has already been paid for the corresponding payee details validity period.

How to View or Edit an Existing Deduction
1.	If you do not have the relevant payee record open on in the Payee Entry screen, use the Payroll> Payee screen to search for and open the relevant payee record.
2.	On the Payee Entry screen, scroll down to the Deductions section or click on the Quick Link.
3.	In the list of deductions, click against the deduction you need to view or modify. The Deduction Details screen opens, showing the details of the deduction you selected.
4.	If you need to modify the deduction, update the relevant fields on the Deduction Details screen as required.
5.	Click Save. The Deduction Details screen closes and any changes you made to the deduction are saved.

How to Delete an Existing Deduction

To delete an existing deduction, follow the procedure below.

How to Delete an Existing Deduction
1.	If you do not have the relevant payee record open on in the Payee Entry screen, use the Payroll > Payee screen to search for and open the relevant payee record.
2.	In the Payee Details section of the Payee Entry screen, scroll down to the Deductions section or click on the Quick Link. The Deductions* tab is activated and lists any of the payee's existing allowances.*
3.	In the list of deductions, click the delete icon against deduction to be deleted. A confirmation message opens, prompting you to confirm the deleting of the selected deduction.
4.	Click Save. The confirmation message closes and the selected deduction is deleted.