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Extra Emoluments

Extra Emoluments are lump sum payments made to an employee and include bonuses, commissions, backpay, retiring or redundancy payments.

The IRD specifies a very complicated formula for the taxing of these lump sum payments. The purpose of the extra emolument procedure in Ace Payroll is to automate the tax calculation according to this formula.



Access extra emoluments from the Options button of the Pay Calculation screen - either from within a regular pay, or a one off payment.



Select the nature of the extra emolument then click Next



Enter the amount of the extra emolument then click Next



A report shows the tax calculation and whether to tax at the higher or lower rate, with the correct rate automatically ticked.

Change if you wish, then click Next



If paying a bonus you can easily gross up from a nett amount.



Click Confirm and you are done.

Why can't I change the tax deduction when I pay an extra emolument?
If you pay an employee using an Ace Payroll extra emolument, you cannot overwrite the tax deduction with your own value.

The whole point of the extra emolument routine is to allow you to make a non standard payment, but have the program calculate the tax using the very complicated formula specified by the IRD.

If you want to be able to change the tax, do not use the extra emolument routine.

Enter the gross amount some other way, for example by using an allowance or entering the amount as a salary. Either of these methods will acheive the same result, but you will be able to change the tax deduction.

More on Pay Calculation

  Pay Rate Structure   Cash rounding activation
  Regular payroll procedures   Must pay cash if employee insists
  Child support variation codes   Extra emoluments
  Overwriting PAYE deductions   Recording daily hours worked
  Allowing alternative holidays   Pay rate change mid period
  Checking previous period is filed   Minimum wage
  One off payments  
  Alphabetical Index FAQ Questions FAQ Contents Back to top
More on Pay Frequencies

  Bi monthly date calculation   Changing all employee pay frequencies
  Period end or actual payment dates   Pay dates and multiple pay frequencies
  Alphabetical Index FAQ Questions FAQ Contents Back to top
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Updated: 28th February 2010
Published: 4th December 2008
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