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Can I include a NET bonus with an employees normal pay?

Article ID
11792
Article Name
Can I include a NET bonus with an employees normal pay?
Created Date
21st November 2019
Product
IRIS PAYE-Master
Problem

How can I pay an employee a NET bonus (included with other GROSS pay)

Resolution

Step 1. In ‘Pay Variations’ configure all the GROSS pay elements correctly (Do not enter the bonus amount at this point) and click on the ‘Quick Calculate’ button.

Step 2. Make a note of the ‘Gross Pay’ and ‘Net Pay’ figures.

Eg        Gross Pay         £ 500.00

            Net pay             £373.19

Step 3. Add the net bonus that you wish to pay to the net pay shown in step 2

Eg  £373.19 + 100.00 = £473.19

Step 4. Click on the ‘Net to Gross’ tab and enter the figure in step 3 ie £473.19

IRIS PAYE-Master will calculate the new gross figure, eg £649.19

Step 5. Subtract the original gross pay from the new gross pay eg £649.19 – £500.00 = £149.19. This will be the amount of the gross bonus.

Step 6. Enter the gross bonus figure eg £149.19 in the ‘Pay Variations’ table under a separate Pay code.

Step 7: Delete the figure held in the Basic Pay, temporary amount field on the ‘Pay Table’ tab.

When the payroll is calculated the result will be a net bonus payment of £100.00.

PLEASE NOTE: PAYE-Master is unable to calculate a NET to GROSS payment if:

The employee circumstances would generate a tax refund.

The employee has an attachment of earnings set up.

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