SAP India Payroll
Objective   To understand the key business processes of the Indian    Payroll component of mySAPHCM.   To gain understan...
IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – Detailed...
Introduction               4
Process Flow INPUT                CALC                  RESULTS          OUTPUT•Master data               Gross           ...
IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – Detailed...
Payroll functional coverage - Legal             Income Tax             Professional Tax             Provident Fund     ...
Payroll functional coverage – Business       Previous Employment Tax          Loans       Income from other sources    ...
Payroll India - Vital statistics                 Modified International info types                 12 India specific inf...
IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – Detailed...
Payroll Structure Payroll Structure consist of the following:  Period Parameters  Payroll Periods  Payroll Area  Contr...
Period Parameters  The period parameter determines whether payroll is run monthly,   bi-monthly, weekly or for several we...
Payroll Periods Payroll periods are generated for each combination of period parameters     and date modifiers assigned to...
Payroll Area                     A payroll area is a unit                      containing all employees for              ...
Control Record                       A control record is created                        for every payroll area. This     ...
Control Record : Periods                    16
Retroactive Accounting                    17
IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – Detailed...
Wage structure - concepts 1§ 2                                                      $                                     ...
Wage structure - concepts 1 § 2$     Wage Elements - salary components          e.g. basic pay / HRA etc        No rest...
Payroll - General Functionality 1 § 2$      Gross payroll accounting with automatic wage calculation      Full gross/ ne...
Pay structure - concepts 1 § 2$            Payscale type - based on industry/ business          e.g.Oil / Power / IT  ...
Allowance Grouping                                             IT 0008  IT 0001                                    Pay Sca...
Indirect Valuation Module                                                            HRA = 40% ofHRA = Rs.6000            ...
Indirect Valuation Module VARIANT A                    25
Indirect Valuation Module VARIANT B & C                                Inval B                                M230 = 50% (...
Indirect Valuation Module VARIANT D             INVAL B & C                   27
Micro Level Indirect Valuation e.g. Children education allowance Rs 250 per child         INVAL A,B,C or D                ...
IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – Detailed...
Infotypes - International IT 0001   Organizational Assignment IT 0002   Personal Data IT 0003   Payroll Status IT 0007   P...
Organisational Assignment – IT 0001 The Organizational    Assignment (0001)    info type deals with    the incorporation ...
Personal Data - IT 0002 The Personal     Data (0002)    info type stores     data for identifying     an employee/    app...
Payroll Status - IT 0003 Here, the system   automatically   updates Payroll   accounted to and   latest Master Data   cha...
Planned Working Time - IT 0007 Here, we  capture the  work schedule  of an employee.                    34
Basic Pay - IT 0008 Used to  store the  employee‟s  current basic  pay and  basic pay  history                           ...
Bank Details - IT 0009 In this, we   capture the   bank details of   an employee.                     36
Recurring Payments/Deductions - IT 0014   Recurring Payments &    Benefits may be in the    form of allowances    made to...
Additional Payments - IT 0015 This Info type is   used to pay a   specified amount   in a single pay   period. Additional...
Contract Elements - IT 0016 In this info type,   we capture the   notice pay   information and   other information   rela...
Monitoring Dates - IT 0019 Here, we  capture the  tasks of an  employee  which needs  to be carried  out during his  empl...
Family/Related Person - IT 0021 Here, we  capture all the  dependant  details of an  employee to  avail tax benefits  as ...
Membership Fees - IT 0057 In this   Infotype, we   capture all   the   membership   details of an   employee.            ...
Personal IDs - IT 0185 Here, we capture  employee details  related to  Superannuation,  Gratuity,  Personnel  account  nu...
Master Data (Indian)  IT 580      Previous Employment Tax Details  IT 581      Housing (HRA/CLA/COA)  IT 582      Exemptio...
Previous Employment Tax Details – IT 0580  PF contributed  Sec 10 exemptions   availed  Medical exemption   claimed  L...
Housing – IT 0581   Eligibility details   House Rent Allowance   Rent details   Co. Leased    Accommodation   Co. Own...
Exemptions (Leave Travel Assistance) – IT 0582   Annual    Reimbursement    based on eligibility   Definition of block  ...
Exemptions (Medical Reimbursement) – IT 0582 Exemption allowed    max upto 15000 per    annum by specifying    an annual ...
Car & Conveyance - IT 0583 Employees who are not    entitled for company car    schemes are eligible to    get conveyance...
Income from other sources – IT 0584   House property details   Business profits   Capital gains   Dividends   Interes...
Section 80 Deductions – IT 0585   Investments made    by employee for    getting tax    exemptions or    rebates   Maint...
Investments details (Section 88) – IT 0586   Investments made by employee    for getting tax exemptions or    rebates   ...
Provident Fund – IT 0587   Multiple trusts   Choice of Basis   Contributions from    Employer   Contributions from    ...
Other Legal Requirements – IT 0588   Employee State    Insurance (ESI)   Professional Tax   Labour Welfare fund        ...
Employee State Insurance (ESI) Employee State Insurance is a benefit provided to any employee earning    wages below a sp...
Professional TaxCoverage of Multiple methods for processing    Frequency - Monthly, Half yearly, Annual    Salary defini...
Labour Welfare Fund (LWF) Labour Welfare Fund (LWF) is a component of compensation provided to    promote the welfare of ...
Long term reimbursements – IT 0590   Perk value of assets can be    maintained   Maintenance of block of years   Amount...
Nominations – IT 0591   ESI benefit   Gratuity benefit   Provident Fund    benefit   Pension benefit                  ...
Income tax   Income tax is deducted from all employees gross salary as per the    Income Tax Act of 1961.   The laws for...
IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – Detailed...
Company Loans – IT 0045    Classify a loan as an Installment or Annuity loan.    Configuration of Interest Calculation m...
Company Loans – IT 0045 cont…Eligibility Checks during Loans Info type Creation:Define Loan Grouping        Define Loan Gr...
Company Loans – IT 0045 cont…   New Options in Loans Info type:   1. Calculate Repayment Installment   2. Display Propo...
Company Loans – IT 0045 cont…Reports for Company Loans:Loan Summary Report :For a given period and loan types,thereport di...
Off Cycle Payments – IT 0267                                Info type 0267 for                                   capturin...
Off Cycle Work Bench                       67
Third Party Deductions  Infotype 0057  Deduction in Payroll  Frequency of the     Payment can be defined    Linkage to...
Third Party Deductions cont…               Deductions                       69
Claims Processing Processing reimbursements to the employee in regular or off cycle payroll run Eligibility Types       ...
Claims Processing – Data entry                                 Data Upload                                 from External  ...
Claims Processing – Results                    72
Claims Processing – Balance Reporting       Claims Processing – Balance Reporting                         73
One Day Salary Deduction                            Configurable at the pay                               scale grouping ...
Salary Packaging Companies switching from traditional pay structure to Flexible pay Total Package offering and Cost to t...
Salary Packaging                    Grouping of                       components at                       organization le...
Salary Packaging cont…  Single Interface for    Infotypes  Eligibility and limits    validity  Payroll simulation for  ...
TDS on BONUS Tax deducted at source during offcycle runs for bonus payments.    Methods of Tax                           ...
Rounding off net pay                             Rounding options                              can be configured         ...
Dearness Allowance    Fixed DA,Variable DA    Configurable Index codes for various Consumer Price Indices.    Methods o...
Dearness Allowance – CalculationCalculation rules definedfor a Allowance Grouping         CPI Value for the DA Index codes...
Basic Increment method based on        •Amount        •Percentage Definable Basic codes for Increment methods. Slabs ca...
Basic Increments   Increment method assigned to a basic   code and Allowance Grouping                                     ...
Superannuation  Customer definable    Superannuation trust ID„s    for the various trusts.  Employer„s Contribution    p...
Schema, PCR’s and Payroll DriverThe following Schema and PCR‟s are relevant to process Payroll in India.• Schema     IN00•...
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IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – Detailed...
Displaying Payroll Results               • This report enables you to display the                  contents of cluster RX,...
Remuneration Statement                   89
Sample Payslip                 90
Payroll Standard Reports            Statutory Reports        Non Statutory Reports        •   Form 5 (PF)          •   Wag...
Payroll Standard Reports contd..                    92
Bank Transfers & Cheque Payments    Employees salaries may be paid by bank transfers where     Company transfers money fr...
Any Questions ?                  94
Thank you       Thank you            95
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Hcl indian payroll_3

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Hcl indian payroll_3

  1. 1. SAP India Payroll
  2. 2. Objective  To understand the key business processes of the Indian Payroll component of mySAPHCM.  To gain understanding of the key terms and definitions of the Indian Payroll component of mySAP HCM.  To provide localization of Indian Payroll according to statutory compliance in India.  This component enables the running of the payroll for all employees in line with Indian legal and business requirements. 2
  3. 3. IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – DetailedPayroll Reporting
  4. 4. Introduction 4
  5. 5. Process Flow INPUT CALC RESULTS OUTPUT•Master data Gross Net Cluster•Time Data •Statutory Reporting • Earnings•Past Data •Monthly • Perks •RT•Cumulations •Half yearly • Income Tax •CRT •Annual • Prof Tax • PF •Interfaces • Recoveries •FI/CO posting •Bank transfer •Payment of taxes •Statutory payments •Third party deductions 5
  6. 6. IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – DetailedPayroll Reporting 6
  7. 7. Payroll functional coverage - Legal  Income Tax  Professional Tax  Provident Fund  Payment of Gratuity  Payment of Bonus  ESI  Labour Welfare Fund 7
  8. 8. Payroll functional coverage – Business  Previous Employment Tax  Loans  Income from other sources  Furniture  Basic salary & increments  Other non -annual allowances  Housing  Claims processing  Car & Conveyance  Flexible Packages  Medical & other  Full & Final settlement reimbursements  Reports  Leave Travel Allowance  Dearness Allowance  Other allowances 8
  9. 9. Payroll India - Vital statistics  Modified International info types  12 India specific info types  60 Indian tables  Rules, schemas, Payroll Driver  4 Indian valuation methods 9
  10. 10. IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – DetailedPayroll Reporting 10
  11. 11. Payroll Structure Payroll Structure consist of the following:  Period Parameters  Payroll Periods  Payroll Area  Control Record 11
  12. 12. Period Parameters  The period parameter determines whether payroll is run monthly, bi-monthly, weekly or for several weeks. Each period parameter used is assigned to a time unit. The values for the time units are defined (monthly, semi-monthly, weekly, bi-weekly, every four weeks, and annually.) 12
  13. 13. Payroll Periods Payroll periods are generated for each combination of period parameters and date modifiers assigned to a payroll area. All periods within the specified time interval are defined based on the period parameter. The start date and end date for each period is defined and the payday is calculated using a rule entered as a parameter. The payroll year and period define the exact dates for the payroll period. 13
  14. 14. Payroll Area  A payroll area is a unit containing all employees for whom a payroll runs at the same time, for example, weekly or monthly.  The payroll is run per payroll area. Each payroll area determines: o Specific dates for which payroll runs. o The earliest period for which retroactive accounting is possible. 14
  15. 15. Control Record  A control record is created for every payroll area. This control record controls the individual stages of payroll. 15
  16. 16. Control Record : Periods 16
  17. 17. Retroactive Accounting 17
  18. 18. IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – DetailedPayroll Reporting 18
  19. 19. Wage structure - concepts 1§ 2 $ Earning/Deduction Payable/Non Payable Wage Types 1..n Taxable/Non Taxable Recurring /Non Recurring Attendance Based Calculation / Entry Allowance Grouping % 3 Employee Parameters like Location, Grade etc.. 19
  20. 20. Wage structure - concepts 1 § 2$  Wage Elements - salary components  e.g. basic pay / HRA etc  No restriction to number of wage elements  Manually entered or computed by system  e.g. PF - 12%(Basic + DA)  Payment or deduction  Wage type % 3  Normal payment- Basic  Recurring payment - Overtime  Additional payment -Bonus. 20
  21. 21. Payroll - General Functionality 1 § 2$  Gross payroll accounting with automatic wage calculation  Full gross/ net retroactive accounting  Freely definable pay slip  Data exchange with banks, insurance agencies, etc. % 3  Direct integration to FI and CO  Online or batch processing  Parallel payroll runs (on different Appl. Servers) 21
  22. 22. Pay structure - concepts 1 § 2$    Payscale type - based on industry/ business  e.g.Oil / Power / IT Payscale Area - based on location  e.g. Plant / Head office Payscale group - on salary grade % 3  eg. Grade A etc  Payscale level - further classification  e.g. Sales / Non sales etc. 22
  23. 23. Allowance Grouping IT 0008 IT 0001 Pay Scale Type / Area / Employee Sub Group Group / Level Allowance Grouping + Micro Criteria + Customer Infotypes • Wage types • Processing Rules • Quantum 23
  24. 24. Indirect Valuation Module HRA = 40% ofHRA = Rs.6000 Fixed Value Factor of WTs Basic Salary + Rs. 2000 A B INVAL D C Slabs of % Subject to Basic Salary a limit Medical =Basic HRA 100% of basic< 5000 1500 s.t. Rs.15,0005 -7000 1800>7000 2500 24
  25. 25. Indirect Valuation Module VARIANT A 25
  26. 26. Indirect Valuation Module VARIANT B & C Inval B M230 = 50% (MB10 + MD10) + 500 Inval C M230 = Minimum of { 50% (MB10 + MD10) & 500 } 26
  27. 27. Indirect Valuation Module VARIANT D INVAL B & C 27
  28. 28. Micro Level Indirect Valuation e.g. Children education allowance Rs 250 per child INVAL A,B,C or D Feature 40ECS Returns a Factor 28
  29. 29. IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – DetailedPayroll Reporting 29
  30. 30. Infotypes - International IT 0001 Organizational Assignment IT 0002 Personal Data IT 0003 Payroll Status IT 0007 Planned Working Time IT 0008 Basic Pay IT 0009 Bank Details IT 0014 Recurring Payments / Deductions IT 0015 Additional Payments IT 0016 Contract Elements IT 0019 Monitoring Dates IT 0021 Family Details * IT 0057 Membership Fees IT 0185 Personal IDs * 30
  31. 31. Organisational Assignment – IT 0001 The Organizational Assignment (0001) info type deals with the incorporation of the employee into the organizational structure and the personnel Enterprise Structure structure. This data is very Personnel Structure important for the authorization and Organisation control of Payroll. Structure 31
  32. 32. Personal Data - IT 0002 The Personal Data (0002) info type stores data for identifying an employee/ applicant. Number of children details are captured will be considered for the tax exemption for child education. Suffix is not mandatory to capture in this info type. 32
  33. 33. Payroll Status - IT 0003 Here, the system automatically updates Payroll accounted to and latest Master Data changes etc… An administrator can manually capture the payroll run upto or Lock the personnel number to exclude from the Payroll process during the payroll period. 33
  34. 34. Planned Working Time - IT 0007 Here, we capture the work schedule of an employee. 34
  35. 35. Basic Pay - IT 0008 Used to store the employee‟s current basic pay and basic pay history Pay Parameters Wage Types 35
  36. 36. Bank Details - IT 0009 In this, we capture the bank details of an employee. 36
  37. 37. Recurring Payments/Deductions - IT 0014 Recurring Payments & Benefits may be in the form of allowances made to an employee in addition to their base pay. Allowances can be recurring (regular payments to an employee) or ad-hoc (once off irregular payments). Deductions are funds that are taken from an employee‟s pay and forwarded to a deduction authority e.g. health fund payments. Depending on the type of allowance or deduction, both can be entered in the Recur. Payments/Deductions. 37
  38. 38. Additional Payments - IT 0015 This Info type is used to pay a specified amount in a single pay period. Additional Payments are classified as allowances that are once-off types of payments e.g. .bonus payments that are made at a particular time of the year. Certain types of deductions can also be set up in Additional Payments, e.g. donation 38
  39. 39. Contract Elements - IT 0016 In this info type, we capture the notice pay information and other information related to employment contract of an employee. 39
  40. 40. Monitoring Dates - IT 0019 Here, we capture the tasks of an employee which needs to be carried out during his employment. 40
  41. 41. Family/Related Person - IT 0021 Here, we capture all the dependant details of an employee to avail tax benefits as per Income Tax law. Children education Children‟s Education allowance/Hostel / Hostel Allowance allowance Exemption captured information will be considered for Children education exemption as per Income tax rules. 41
  42. 42. Membership Fees - IT 0057 In this Infotype, we capture all the membership details of an employee. 42
  43. 43. Personal IDs - IT 0185 Here, we capture employee details related to Superannuation, Gratuity, Personnel account number(PAN). 43
  44. 44. Master Data (Indian) IT 580 Previous Employment Tax Details IT 581 Housing (HRA/CLA/COA) IT 582 Exemptions IT 583 Car & Conveyance IT 584 Income From Other Sources IT 585 Section 80 Deductions IT 586 Investment Details (Section 88) IT 587 Provident Fund Contribution IT 588 Other Statutory Deductions IT 590 Long Term Reimbursements IT 591 Nominations 44
  45. 45. Previous Employment Tax Details – IT 0580  PF contributed  Sec 10 exemptions availed  Medical exemption claimed  LTA availed  Tax deducted so far 45
  46. 46. Housing – IT 0581 Eligibility details House Rent Allowance Rent details Co. Leased Accommodation Co. Owned Accommodation Differential payment HRA exemption amount Calculation of perk value in case of leased accommodation Value of helper Value of furniture 46
  47. 47. Exemptions (Leave Travel Assistance) – IT 0582 Annual Reimbursement based on eligibility Definition of block of 4 years Travel Details Link to Leave Carry forward of LTA 47
  48. 48. Exemptions (Medical Reimbursement) – IT 0582 Exemption allowed max upto 15000 per annum by specifying an annual amount for Medical Reimbursement and making payments against claims submitted by the employee. To avail the exemption ,we need to capture the details of medical bills in MDA subtype for Medical Reimbursements. 48
  49. 49. Car & Conveyance - IT 0583 Employees who are not entitled for company car schemes are eligible to get conveyance exemption max up to Rs.800/ - per month. Company Car Scheme, the system calculates the perquisite value for an employee only if the Calculate Perk indicator is selected in this infotype. If the company is providing the employee with a driver or drivers for a Car Scheme, there is a perquisite value attached to a driver. This perquisite amount for a driver is stored in the table view Payroll Constants (V_T511P) 49
  50. 50. Income from other sources – IT 0584 House property details Business profits Capital gains Dividends Interests 50
  51. 51. Section 80 Deductions – IT 0585 Investments made by employee for getting tax exemptions or rebates Maintain the Section 80/88 limits 51
  52. 52. Investments details (Section 88) – IT 0586 Investments made by employee for getting tax exemptions or rebates maintain the Section 80/88 limits 52
  53. 53. Provident Fund – IT 0587 Multiple trusts Choice of Basis Contributions from Employer Contributions from Employee Payment to pension Voluntary Provident Fund 53
  54. 54. Other Legal Requirements – IT 0588 Employee State Insurance (ESI) Professional Tax Labour Welfare fund 54
  55. 55. Employee State Insurance (ESI) Employee State Insurance is a benefit provided to any employee earning wages below a specified limit to provide for: -Hospital facilities and out-patient facilities -Medicines provided by the hospital -Compensation in case of accident or death The ESI fund requires contributions from employees and the employer. The amounts would be deducted as per state ESI act. Employees earning a salary of less than Rs.6500 are eligible for this benefit. Table name : V_T7INE3 55
  56. 56. Professional TaxCoverage of Multiple methods for processing  Frequency - Monthly, Half yearly, Annual  Salary definition - Wage types, Actual  Retroactive processing  Forms for returnsCoverage of states  South -Tamilnadu,karnataka,kerala,Andhra Pradesh  West - Maharashtra ,Goa,Punjab,Gujarat  Central - Madhya Pradesh, Chhattisgarh  East - West Bengal, Sikkim, Tripura, Orissa, Meghalaya, Arunachal Pradesh  North - Jammu & Kashmir, Uttar Pradesh, Haryana 56
  57. 57. Labour Welfare Fund (LWF) Labour Welfare Fund (LWF) is a component of compensation provided to promote the welfare of labour in the state. The eligibility criteria governing the contributions towards Labour Welfare Fund differ from state to state, but typically people employed to do any work under the following categories are eligible: - Skilled / Unskilled - Manual /Clerical - Technical/Non- Technical, and - Must have worked for a period of 30 days during the relevant period The contribution rates for LWF are valid for the time period specified and may vary depending on respective state laws. 57
  58. 58. Long term reimbursements – IT 0590 Perk value of assets can be maintained Maintenance of block of years Amount check against eligibility Perk calculation for the year based on the total value Other non – annual reimbursements Transfer of asset 58
  59. 59. Nominations – IT 0591 ESI benefit Gratuity benefit Provident Fund benefit Pension benefit 59
  60. 60. Income tax Income tax is deducted from all employees gross salary as per the Income Tax Act of 1961. The laws for the calculation of taxes are subject to change with changes in the Income tax act. Calculation of the tax based on the investments made and the standard deduction  User definable tax slabs and percentages  Tax calculation based on “actual investment” or “ Proposed investment” 60
  61. 61. IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – DetailedPayroll Reporting 61
  62. 62. Company Loans – IT 0045  Classify a loan as an Installment or Annuity loan.  Configuration of Interest Calculation method.  Configuration of Interest Calculation days.  Configuration of Interest rates  Configuration of frequencies for repayment and interest  Loan payment / repayment can be via payroll / external means.  Disbursement of the approved loan amount in installments.  Display the Proposed Disbursement Plan for the employee for the loan being created.  Computation of interest rate advantage on interest free or subsidized loans.  Cumulating of Interest rate advantage as above to annual perk amount.  Computation of Penal Interest due to Foreclosure of loans .  Simulation of loan repayment Plan. 62
  63. 63. Company Loans – IT 0045 cont…Eligibility Checks during Loans Info type Creation:Define Loan Grouping Define Loan Grouping for India – Maintain Loan Eligibilityfor India – dependent dependent on loan type and ALGRP Checks and limitson loan type andALGRP Check for the following during a new loan creation  Minimum Experience  Maximum Age  Months allowed between Current and Previous loan  Number of outstanding loans allowed at a time  Maximum number of loans allowed during the entire service  Total Outstanding loan amount allowed  Approved loan amount a minimum of Salary , % asset value and a fixed amount definable by customer. 63
  64. 64. Company Loans – IT 0045 cont… New Options in Loans Info type: 1. Calculate Repayment Installment 2. Display Proposed Disbursement Plan 3. Simulate Penal Interest due to loan foreclosure 64
  65. 65. Company Loans – IT 0045 cont…Reports for Company Loans:Loan Summary Report :For a given period and loan types,thereport displays various details like interest,principal, interest subsidy etc. employee wise. 2. Batch Program for Penal Interest due to Loan Foreclosure: This report is used to update the Additional Payments Info type (0015) with the Penal Interest Amount in case of loans foreclosure 65
  66. 66. Off Cycle Payments – IT 0267  Info type 0267 for capturing Off cycle payments  Off cycle for Bonus type runs have been enabled  Professional Tax computation for bonus payments in off cycle is considered  Tax on bonus can be computed using different methods  Reimbursements can be paid in off cycle payments using claims module 66
  67. 67. Off Cycle Work Bench 67
  68. 68. Third Party Deductions  Infotype 0057  Deduction in Payroll  Frequency of the Payment can be defined  Linkage to Sec88 Rebate in Payroll  Linkage to Sec80 Exemptions in Payroll  Different Payee options 68
  69. 69. Third Party Deductions cont… Deductions 69
  70. 70. Claims Processing Processing reimbursements to the employee in regular or off cycle payroll run Eligibility Types  Amount e.g. Rs. 24000 for Medical Reimbursement  Numbers e.g. 250 Liters of petrol  Amount subjected to number of times e.g Stitching allowance eligibility upto Rs. 1000 can be claimed in a year and can be claimed twice Validity periods for each reimbursement type can be configured  Monthly, Financial year, Calendar year, customer definable year ..etc Capture company specific additional data for each reimbursement. Upload balances at the beginning of the validity period Check on balance available against component - Carried Forward & Current Year eligibility Validity period (Year) end processing options  Payment of outstanding balance, Taxation of Amount  Carry forward of the balance to the next year  Lapse 70
  71. 71. Claims Processing – Data entry Data Upload from External File 71
  72. 72. Claims Processing – Results 72
  73. 73. Claims Processing – Balance Reporting Claims Processing – Balance Reporting 73
  74. 74. One Day Salary Deduction  Configurable at the pay scale grouping for allowances.  Pay Period and the Year for the deduction can be defined.  Different calculation methods for basis  Factor  Can be configured for Employer‟s equal contribution.  Can be customized for Section 80/88 exemption 74
  75. 75. Salary Packaging Companies switching from traditional pay structure to Flexible pay Total Package offering and Cost to the company Flexible arrangement for employees to choose from a range of benefits together with a cash salary and fixed set of components. Take home pay analysis for employee. Salary packaging combines data from all sources into a manageable central location and then updates data when process of Salary packaging is complete. Employee Self Service 75
  76. 76. Salary Packaging  Grouping of components at organization level  Common Interface for all type of payments and eligibility  e.g. Employee can opt for Leave Travel allowance only if he is eligible  Mandatory components and fixed % of some components  Maximum and Minimum limits  Customer specific checks
  77. 77. Salary Packaging cont…  Single Interface for Infotypes  Eligibility and limits validity  Payroll simulation for take home pay analysis  Individual eligibility definition for claims 77
  78. 78. TDS on BONUS Tax deducted at source during offcycle runs for bonus payments.  Methods of Tax Calculation Maintain Bonus payments in Infotype 0267.  Tax at a standard rate to be used across a Company.  Tax at the individual employees marginal rate of tax (excluding surcharge or including surcharge) before the payment of bonus or after  There are 5 different methods to compute TDS. The choice of the payment of which method bonus  First parameter maintained in the schema against function INBTD.  Multiple bonuses can be paid in the same offcycle run.  Customer Exit provided to override TDS computed by SAP. 78
  79. 79. Rounding off net pay  Rounding options can be configured at the Pay Scale for allowances Grouping level.  Configurable rounding Options  Configurable recovery of rounded off options 79
  80. 80. Dearness Allowance  Fixed DA,Variable DA  Configurable Index codes for various Consumer Price Indices.  Methods of calculating DA - Non-Slab based calculation. - Basic slab based calculation. - Incremental basic slab based calculation. - CPI slab based calculation. - Incremental CPI slab based calculation. - Basic slab based calculation, subject to minimum value  A report program generates a batch session, which will populate the Basic Pay Infotype (IT0008) with relevant wage type and amount for DA (both fixed and variable) by reading the configuration tables. 80
  81. 81. Dearness Allowance – CalculationCalculation rules definedfor a Allowance Grouping CPI Value for the DA Index codes Fixed DA Variable DA 81
  82. 82. Basic Increment method based on •Amount •Percentage Definable Basic codes for Increment methods. Slabs can be defined for basic codes For Percentage based increment, the increment can be calculated as a Percentage of •Average of Minimum Basic and Maximum Basic of slab, •Minimum Basic of slab, •Current Basic Customer Configurable Increment Criteria Promotion criteria is based on •Minimum age for promotion •Minimum experience in the current Pay scale Group and Pay scale Level •Minimum appraisal points •Confirmation Status •Report program will create a Batch session to update the basic wage type and delimit Basic Pay Infotype (IT0008) with the reference date. 82
  83. 83. Basic Increments Increment method assigned to a basic code and Allowance Grouping Amount based increment given for a set of employeesBasic pay and personal pay Wage typeassigned to an allowance groupingBasic slabs with the increment range and amount 83
  84. 84. Superannuation  Customer definable Superannuation trust ID„s for the various trusts.  Employer„s Contribution percentage  Frequency of contribution (Monthly/Annual)  Contributions can be for calendar year or financial  Option for making provisions for monthly contributions 84
  85. 85. Schema, PCR’s and Payroll DriverThe following Schema and PCR‟s are relevant to process Payroll in India.• Schema IN00• Payroll Drivers HINCALC0• Personal calculation Rules (PCR‟s) IEDL - HR-IN: Employer EDLI contrib. as 0.005% (0.01) and multiply by 1lakh IERC - HR-IN: Employer PF/Pen contributions 1lakh division INRT - HR-IN: Cumulate Payments for TDS in Regular Run INVT - HR-IN: Voluntary tax deduction IPER - HR-IN: Adding the Monthly Perk to Annual Perk IRET - HR-IN: PF and PT Retro Carry forward in case of ArrearsI 85
  86. 86. 86
  87. 87. IntroductionPayroll Coverage - OverviewPayroll StructureWage StructurePayroll Related InfotypesPayroll Coverage – DetailedPayroll Reporting 87
  88. 88. Displaying Payroll Results • This report enables you to display the contents of cluster RX, which contains the detailed payroll results. You can select the data records using the following criteria: • Personnel number • Start date and end date of the for-period selection period • Status indicator of results record 88
  89. 89. Remuneration Statement 89
  90. 90. Sample Payslip 90
  91. 91. Payroll Standard Reports Statutory Reports Non Statutory Reports • Form 5 (PF) • Wage Type Statement • Form 10 (PF) • Wage Type Distribution • Form 16 (Income tax) • Payroll Journal • Form 24 (Income tax • Payroll Annual Display • Form 7 (ESI) • Post Payroll Check Printing • Form 6 (ESI) • Post Payroll • Form 3A (PF) • Data Medium Exchange • Form 6A (PF) • Cash Breakdown List • P.Tax returns (P.Tax) • Form 217 2(A) 91
  92. 92. Payroll Standard Reports contd.. 92
  93. 93. Bank Transfers & Cheque Payments  Employees salaries may be paid by bank transfers where Company transfers money from its own bank to that of the employee; or  Employees may be paid directly by cheque. This practice should generally be discouraged. 93
  94. 94. Any Questions ? 94
  95. 95. Thank you Thank you 95

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