Payroll
Branch regulatory deductions and the deduction preview
Set up levies and fees that a branch must deduct from salaries, such as a union fee, and preview the statutory deductions for one employee before you run payroll.
3 min readLast updated
In this article
A branch regulatory deduction is a levy that the law or an agreement requires a branch to take from salaries: a union fee, a municipality levy, a solidarity contribution. You define it once for the branch, and every payroll run for that branch's employees takes it automatically and shows it as its own line on the payslip.
Create a branch deduction
Open People › Payroll › Global Payroll Localization and select the Branch Deductions tab.
Select New Deduction.
Enter the Name, the Name (Arabic) and a Code. The code must be unique within the branch.
Choose the Branch.
Under Calculation, choose a fixed amount and enter the Amount, or choose a percentage of basic or of gross and enter the Rate as a whole percentage, for example 1 for 1%.
Under Applies To, choose who pays it. For a custom deduction, pick the Employees in the list that appears; at least one is required.
Choose the Frequency, and set Effective from and Effective to if the deduction has a start or an end.
Enter the GL Account ID of the liability account the deduction is credited to, keep Active on, and select Save.
Use View in the row's Actions menu to see the rule, its period, its frequency and the employees it targets. Edit and Delete are in the same menu.
How the payroll run applies it
Who: the employees whose branch is the deduction's branch, filtered by Applies To. A custom deduction applies only to the employees you chose.
When: the deduction must be active and in force at some point of the payroll period, from Effective from to Effective to. A monthly deduction is taken every month. A quarterly, semi-annual or annual one is taken every 3, 6 or 12 months, counted from the month of Effective from.
How much: a fixed amount, or the rate times the basic salary or the gross salary of the period. Gross includes allowances and overtime.
Order: it is taken after social insurance, benefit contributions and absence deductions, and before income tax, loan installments and penalties. It never takes more than the pay that is left.
Tax: it reduces taxable income.
Accounting: when payslips are posted, the amount is credited to the account in GL Account ID. Without an account, the amount joins the journal's loan recovery credit, so always set one. See payroll posting.
Preview the statutory deductions
Select the Deduction Preview tab.
Choose the Employee and the Branch, and enter a Basic Salary and a Gross Salary.
Select Compute.
The Result shows:
Social insurance payroll will apply: the employee and employer contributions the payroll run will actually take, from whichever source HR settings use.
Social insurance and Income tax (monthly) from the branch's country profile. If no profile matches the branch's country, the screen says so.
Regulatory deductions: the branch deductions that apply to this employee today.
The preview changes nothing. Its income tax is estimated on the gross salary you enter, while the payroll run taxes the taxable income after deductions, so the payslip's tax can be lower.
Common questions
A deduction did not appear on a payslip. Check that it is active, that the payroll period falls between its effective dates, that it is due in that month for its frequency, and that the employee belongs to the deduction's branch.