FlexiTime generates pay for employees using pre-defined Pay Codes.
Some pay codes are added to an employee’s pay automatically from the employee’s timesheet (if Derive Pay by Timesheet is selected on Employment Details).
Other pay codes are included because they have been added as default pay codes for an employee.
In some cases, such as pay deductions, specifying a deduction amount or selecting different options on the employee settings will automatically add the appropriate pay code to the employee’s default pay codes. For example, specifying an employee as a pre-existing member of KiwiSaver or adding an enrolment date for KiwiSaver will automatically add the KiwiSaver employer contribution pay code KSR and the employee deduction pay code KIWI2, KIWI4 or KIWI8 (depending on the KiwisSaver contribution rate) to the employee’s default pay codes.
FlexiTime groups Pay Codes into different tax types for calculating the employee pay. For each Pay Code a quantity and rate are applied and based on the settings defined for each pay code and the rules of processing applied by FlexiTime an amount is calculated. Pay Codes are grouped into different types as follows:
Additive Pay Code Types (+)
- Gross Earnings, e.g. hourly rates, overtime rates
- Taxable Allowances, e.g. Bonus payments
- Non-Taxable Allowances
Deducting Pay Code Types (–)
- Pre Tax Deductions
- Taxes, i.e. PAYE
- Post Tax Deductions, e.g. KiwiSaver Employee Deductions, Student Loan repayments
- Payroll Donations
- Payments, i.e. the method used to pay the employee e.g. Cash, Direct Credit, Cheque
The total of additive pay code types should balance with the total of deducting pay code types in a pay. As well as these pay code types a pay may include a Superannuation Contribution pay code such as KSR – KiwiSaver Employer Contribution. These are not paid to the employee but are paid by the employer directly to Inland Revenue or to a superannuation scheme.
- Superannuation Contributions, e.g. KiwiSaver Employer Contributions
A standard set of pay codes are automatically created by FlexiTime for each new company. Some of the standard pay codes are used by FlexiTime for pay calculations and are required by the processing rules in FlexiTime; these Pay Codes can only be partially modified and cannot be deleted.
For information on how to modify your Pay Codes to suit your business, please see the Maintain Pay Code support article.