Understanding Deductions

This chapter provides an overview of deduction types and discusses how to:

• Use batch positive input.

• Create deduction elements.

• View delivered deduction elements.

Understanding Deduction Types

In Brazil, two types of deductions are available:

• Before taxes reduces the net salary and the taxable gross for federal retention, or other taxes based on the accumulators used. Examples are FALTA INJUSTIFICADA and DESC DSR.

• After taxes reduces the net salary. Examples are CLUBE, EMPRESTIMO, and FARMACIA.

Note. You define all deductions for Brazil in the Deductions (GP_DEDUCTION) component in the core application.

See Also

Withholding Income Tax (IRRF)

Defining Earning and Deduction Elements

Using Batch Positive Input

You can use batch positive input to reduce time-consuming data entry in Global Payroll for Brazil. For example, you could trigger mass deductions. Assume that an employer has an agreement with a cell phone company to provide half the employee population with a 50 percent discount rate on calls. Instead of entering each of the monthly cell phone invoices (deductions) for each employee, the cell phone company could generate a flat file with a layout that loads this invoice information using a batch process.

Setting up the flat file for batch positive input is discussed in "Defining Earnings."

See Also

Defining Earnings

Creating Deduction Elements

To ensure that new deduction elements you create are used correctly in other calculations, you need to know which accumulators they should contribute to, since the value of the accumulated deductions is critical to these other processes. The accumulator elements to which you will be adding your elements are the same ones that Global Payroll for Brazil has created for the delivered deduction elements. These are listed and described below:

• Any deduction that you want to contribute to the Net Pay should be included in the TOTAL DESCONTOS N accumulator.

  Note. Many deductions are only for demonstration purposes. These dummy deductions should not be included in TOTAL DESCONTOS N.

• Any deduction that you want to subtract from the taxable base for federal tax purposes should be included in the IR REN BRUTA accumulator, if it should reduce the calculation base, or in the IR DEDUÇÕES accumulator, if it is a legal income tax deduction.

Adding your new deductions to the proper accumulators ensures that the new element fits into the existing logic and organization of Global Payroll for Brazil and that it is included in the correct calculations for taxes, social security, and so forth.

See Also

Overrides Available for Supporting Elements

Viewing Delivered Deduction Elements

This section discusses:

• General deductions.

• Process lists with deductions.

The PeopleSoft system delivers a query that you can run to view the names of all delivered elements that are designed for Brazil. Instructions for running the query are provided in the PeopleSoft Global Payroll PeopleBook.

Note. The majority of the deduction elements for Brazil are defined as PeopleSoft Delivered/Not Maintained. This means that you can modify these elements to fit your needs and, when necessary, create your own earnings using the delivered elements as your guide. You should not modify deduction elements that are defined as PeopleSoft Delivered/Maintained.

See Also

Viewing Delivered Elements

General Deductions

The following table lists the general deductions for Brazil:

Process Lists with Deductions

A specific process list for deduction calculations does not exist. All defined process lists contain both deductions and earnings.

The following are the main sections used to calculate deduction elements for Brazil:

• KR ENCARGOS LEGAIS

• KR DESC ADIA QUINZ

• KR IMPOSTO RENDA

• KR AUSENCIAS FOL

• KR PENS ALIMENTIC

• KR OUTROS DESCTOS

Note. A list of delivered process lists used to calculate deductions and other elements can be found in "Defining Country Data."

See Also

Defining Country Data

Defining Processing Elements