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Setups | Payroll | Allowances | Maintain

Allowances are amounts paid to employees on top of their normal salary or wage, for example uniform allowance. There is no limit to the number of Allowance Codes you can create.

Once an Allowance Code is established it can be accessed on standard pays and in transaction entry.

You can specify how each Allowance Code is to be entered or calculated, as well as whether to print on pay advice or not. The number of fields displayed on the screen will vary depending on the type specified.

Fields can be fixed so no change can be made during transaction entry, or variable to allow changes during transaction entry.

All Allowances, excepting those set up as a Quantity type, will be multiplied by the number of Tax Periods entered on the transaction header. For example, when a weekly employee goes on 3 weeks' annual leave, you will enter 3.0 Tax Periods. Allowances are then multiplied by this number to give 3 periods worth of allowances.

For Australia, Lump Sum E payments (back pay of certain amounts, including a payment of salary or wages that accrued more than 12 months ago) should be processed as an allowance. When setting up the allowance, ensure that you set the Tax Certificate Code to 3=Lump Sum Payment E. For more information see Reporting lump sum E (Label E) payments.

For New Zealand, termination payments should be processed as an allowance using the allowance type of A=Holiday Termination (NZ). For more information see Termination payments (New Zealand).


Setting up allowances for Single Touch Payroll reporting

In Attaché 18 (and later), you can set up allowance types in the Tax Certificate Code field to reflect the classifications required by the Australian Taxation Office (ATO) for Single Touch Payroll reporting.  

See Setting up itemised allowances for Single Touch Payroll

Related resources

(1.56 mins video)

Field descriptions


 Header fields
Field or group nameDescription
Allowance Code

You must allocate a code to each allowance. This is an identification code by which allowances are accessed. It is advisable to devise a logical coding system that is as short as possible, as this makes it easier when entering the allowances during transaction entry. Any combination of letters and numbers can be used. 
e.g.    MV for Motor Vehicle Allowance

Allowances will sort into strict alphabetical order on the Find facility and reports. e.g.    
0 to 9 before A to Z.

If numbers are used, make sure you keep the codes the same length so they sort correctly.
e.g.    0001, 0002, 0005, 0010, 0020

If these numbers were entered as: 1, 2, 5, 10, 20

they would sort as 1, 10, 2, 20, 5.

Description

This Description will display or print each time this allowance is accessed.

Inactive

To flag an item as Inactive, select this check box.

By default, inactive items are not displayed in lookups and drop-down lists, but can be included in reports by selecting the appropriate Include inactive check box when creating the report.

You can still view inactive items in lookups by selecting ShowInactiv (F7) to reveal them, or HideInactiv (F7) to conceal them.

 Allowance Code Details tab
Field or group nameDescription
TypeSee Type field in Allowance Maintenance
Tax Status

Note: It is not possible to change the Tax Status of an allowance after a pay which uses the allowance has been run in the financial year. If you want to change the Tax Status, create a new allowance with the required Tax Status and use it in place of the existing allowance.

B = Before Tax

Select Before Tax if the allowance is to be taxed.
Allowances before tax are included in the employee's taxable pay. These allowances usually represent some form of additional pay as
compensation for working conditions or for special skills.

Taxable allowances are usually included in the Gross Salary Column on the Tax Certificate/PAYE Deduction Certificate.

In New Zealand, these Taxable allowances are usually included in the EMS tax report totals.

Examples
Uniform Allowance
First Aid Allowance
Leading Hand Allowance
Site Allowance

A = After Tax

Select After Tax if the allowance is not to be taxed.

Allowances after tax are included in the employee's gross pay but are not included in their taxable pay. These allowances usually represent
expenses that could be claimed by the employee as tax deductions.

Non-Taxable allowances are usually shown separately in the allowance column on the Tax Certificate/PAYE Deduction Certificate.

In New Zealand these Non-Taxable allowances are not usually included in the EMS tax report totals.

Examples
Car Allowance
Overtime Meal Allowance
Living Away From Home Allowance

Include in OTEIf you wish to include an allowance type as part of the employee's income for the calculation of Super Guarantee, set this checkbox to Yes.

Tax Certificate Code

See Tax Certificate Code field
EMS Tax Report Code

0 = Do not show on the EMS Tax Reports Totals
1 = Include in EMS Tax Reports Totals

The EMS tax report code specifies if an allowance will be included in the monthly EMS figures. It is important to go through each of your allowances to ensure
they are correctly configured to appear in the EMS. The reporting requirements for individual allowances can be obtained from the IRD.

Amount



See Amount, Quality, Percent and Rate fields in Allowance Maintenance

Quantity
Percent
Rate
Per

Enter a description for the rate.
e.g. meal, Km.

This description will display during transaction entry. 

Quantity Minimum

This field works in association with Calculate Hours from/Calculate Quantity from:

If you set Calculate Hours from/Calculate from to Minimum, and total hours/total quantity equals or exceeds this maximum value, the line is calculated by the value
of the allowance/deduction type, minus this maximum value:
Example:

TypeSample calculation
Hours Worked ($)(Hours Maximum — Hours Minimum) x Rate
Hours Worked (%)(Hours Maximum — Hours Minimum) x Normal Pay Rate x Percent.
Quantity(Quantity Minimum — Quantity Minimum) x Rate

If Calculate Hours from/Calculate Quantity from is set to Zero and total hours/total quantity equals or exceeds this maximum value, the line is calculated using
this maximum value:
Example:

TypeSample calculation
Hours Worked ($)Hours Maximum x Rate
Hours worked (%)(Hours Maximum — Hours Minimum) x Normal Pay Rate x Percent.
QuantityQuantity Maximum x Rate


In an Adjustment Pay, the maximum is ignored.

Leave this field at 9999999.99 if you do not wish to specify a particular limit.

Quantity Maximum
Calculate Quantity from
Value Minimum

If a value lower than this minimum is entered for a time sheet pay, the line extension will be calculated on this minimum not the value entered.

Adjustments will always use the value entered, the minimum value will not be activated. If you are using minimum value and you wish to enter a negative value
you must do so via Adjustments.

Leave at zero if you do not wish to check for a minimum.

Value Maximum

If a value higher than this maximum is entered for a time sheet pay, the line extension will be calculated on this maximum not the value entered.

Adjustments will always use the value entered, the maximum value will not be activated. If you are using maximum value and you wish to enter a negative
value you must do so via Adjustments.

Leave this field at 9999999.99 unless you want to specify a particular limit.

Show Rate on Pay Advice

If you wish to show the rate/quantity as well as the line extension on the pay advices, select this check box.

You would probably not select to show the rate for an amount type allowance as a rate does not really exist for this type and 1.0000 will print.

The rate/quantity will always print on the Pay Details report, if print line details is selected on the report.

Show YTD on Pay AdviceTo show year-to-date (YTD) amounts on pay advices, select this check box.

YTD figures are not available for cash-paid employees as the cash breakdown is printed in this space.
Allow Date Entry

Date entry will allow you to indicate the actual day the employee received the allowance.

e.g. 10/09/95 Meal Allowance 6.20.

During transaction entry, an additional date field will display when this allowance is accessed. If no date is entered, the Pay Period Ending date is used.

Note: If date entry is selected, this allowance will take up two lines on pay advices.

This date will always print on the Pay Details report, if print line details is selected on the report. 

Multiple G/L Dissections

You would only select Multiple G/L Dissections if you want your cost centres to update more than one general ledger expense account for this pay element.

Once selected, you must allocate a default general ledger expense account, then for those cost centres that differ, you can allocate individual general ledger
expense account codes.

You would not select Multiple G/L Dissections if all cost centres for this pay element are to update the same general ledger expense account.

Include in SG ThresholdThe Include in SG Threshold checkbox in Income Type Maintenance, Allowance Maintenance and Deduction Maintenance lets you indicate whether a pay
element should be included as part of the employee's income for the purpose of the monthly Super Guarantee threshold.

The minimum threshold for Super Guarantee is set by the Australian Taxation Office. If an employee's monthly income is less than the threshold amount there is no requirement to pay Super Guarantee.

Include in Leave Calculation

New Zealand


To include a pay element in the calculation of leave payments for public holidays, alternative holidays, sick leave, bereavement leave and annual holidays,
select the Include in Leave Calculation check box.

Exclude from Ord. Wkly Pay

New Zealand

This field is available only if you select the Include in Leave Calculation check box.

To exclude an allowance from the ordinary 4-week hourly rate and the normal pay rate select the Exclude from Ord. Wkly Pay check box. This enables you to 
exclude irregular allowances, such as back pay, from the ordinary weekly pay calculation but still include them in the average weekly earnings calculation.

Gross Pay for TermPay

New Zealand


To include a pay element in the calculation of gross earnings for a termination pay, select the Gross Pay for TermPay check box.

Consolidate on Pay AdviceTo consolidate allowance lines on a pay advice, select the Consolidate on Pay Advice check box.
When printing pay advices, if there are multiple lines on the timesheet with the same allowance code, these will print as a consolidated line.
Back Pay, Bonus, Comm.

To calculate tax on the allowance by spreading the payment across the number of pay periods in the current tax year based on the number of pays per year, select the Back Pay, Bonus, Comm check box.

Note: DO NOT tick this check box if this is a regular allowance that the employee receives every pay, if the allowance payment forms part of the employee's normal pay, or if part or all of the payment is to be salary sacrificed.

 Calculation Basis
Field or group nameDescription
% of Calculated based on:
Income

See Income field in Allowance Mainteance and Deduction Maintenance

Allowances

See Allowance field in Allowance Maintenance and Deduction Maintenance

Selection Type

A = All
I   = Include
E = Exclude

Keep in mind that if you don't exclude other % of Calculated allowances from the calculation of this allowance then the result will be cumulative.  In other words, the result of this allowance will be included in and cause a recalculation of the original allowance.

Select All to include ALL other allowances in the calculation of this allowance.
Select Include if the number of other allowances, or groups of allowances, to be used is less than the number not to be used.  This will allow you to list those codes or groups of codes to be included in the calculation of this allowance.
Select Exclude if the number of other allowances or groups of allowances to be used is greater than the number not to be used.  This will allow you to list those codes or groups of codes not to be included in the calculation of this allowance.

 Expense Account tab
Field or group nameDescription
General Ledger Posting Details
Expense Account

If you deselect the check box in the Multiple G/L Dissections field, enter the general ledger Expense Account code to be updated.

If you select the check box in the Multiple G/L Dissections field, enter the general ledger Expense Account code to be used for most cost centres. Additional screens will display and allow you to enter details for any cost centres which update different general ledger codes.

Consolidate

Y - Yes
N - No

Yes adds the amount to one total transaction for this general ledger code.  This transaction will continue to accumulate until the general ledger posting report is printed and cleared, or General Ledger - Other Module Postings has been completed.

No generates a separate transaction for each employee for this code.  These transactions can be reported and/or updated to the general ledger for each pay.

Note: If you are updating the general ledger module it is advisable to consolidate, otherwise a large number of transactions will be posted to your general ledger.  The detailed information you require may be available via the payroll reports provided.

 Multiple GL Dissections tab
Field or group nameDescription
Cost Centre

Enter only those cost centres that are to update a different general ledger expense account from the default general ledger expense account entered on the Expense Account tab.

Expense AccountType or choose the expense account that you want to associate with the above cost centre.
Consolidate

Y = Yes
N = No

Yes adds the amount to one total transaction for this general ledger code. This transaction will continue to accumulate until the general ledger posting report is printed and cleared, or General Ledger - Other Module Postings has been completed.

No generates a separate transaction for each employee for this code. These transactions can be reported and/or updated to the general ledger for each pay.

Note: If you are updating the general ledger module it is advisable to consolidate, otherwise a large number of transactions will be posted to your general ledger. The detailed information you require may be available via the payroll reports provided.







REF: ID 204 | MOD 9 PAYMODS | APR-125, FD-589  300316 3.3, SF 3938, 4479, 4335, 2778 | 080519 | 18.1