There are a number of different reasons for deducting money from an employee's pay. These may include student loan repayments, KiwiSaver or superannuation deductions, child support, deductions for money owed to IRD, Courts or WINZ, charitable donations or the repayment of a debt owed to the employer. A deduction may be a one-off payment in a single pay or a regular payment in every pay.
FlexiTime enables you to easily manage these deductions so that they are correctly calculated and, where necessary, reported to IRD.
The following deductions are managed by using the Pay Deduction tab on the Employee record :
- Inland Revenue Arrears
- Child Support
- Courts payments
- Work and Income Arrears
- Additional Student Loan payments
For information on setting these deductions up, please see this article.
Student Loan deductions are automatically made if the employee's tax code ends with "SL", for example "M SL" or "S SL". If the employee needs to make additional Student Loan payments, please see this article.
It is important to note that these deductions automatically add the relevant pay codes to the employee's Default Pay tab. These pay codes should not be deleted, edited or manually added on the Default Pay tab or the employee's pay. You should always use the Pay Deductions tab to manage these deductions.
The following articles explain how to set up other types of deductions from an employee's pay.
Payroll Giving (charitable donations)
Repayment of debt to the employer, e.g. for the purchase of tools or equipment, a loan or wages advance.
To create a one-off deduction from an employee's pay, first create a Pay Code for the deduction with tax type Post-Tax Deduction and then add it to the employee's pay and edit the rate to match the deduction amount required.