Modifying Delivered Earnings Elements
Global Payroll for China delivers earnings-related elements based on practices that are common to many businesses in China. Although most of the delivered elements are created according to common industry standards or based on statutory requirements, a company's specific business practices may require modifications to them. This topic provides examples of common modifications to earnings elements.
Currently the system uses base monthly salary as the basis for calculating the 13THMNTH PAY earning. To use net pay as the basis instead of base monthly salary, modify the members of the segment accumulator CN AC 13BASE SEG by removing the rate code CN RC BASE SALARY and replacing it with CHN NET.
13THMNTH PAY is the delivered contributing earning for the TAXABLE SP PAYMENT accumulator. You can replace 13THMNTH PAY with a different contributing earning that you want to be taxed as an annual bonus.
Note: If you use the delivered 13THMNTH PAY earning for 13th month pay, and if you leave this earning in the TAXABLE SP PAYMENT accumulator, then 13th month pay is taxed as an annual bonus.
If 13th month pay is to be taxed as salary rather than as an annual bonus, you must modify the delivered setup so that you have a 13th month pay earning that is part of the TAXABLE NORMAL SAL accumulator and not part of the TAXABLE SP PAYMENT accumulator. Specifically, if you continue to use the delivered 13THMNTH PAY earning for 13th month pay, you must modify the accumulator definitions. Alternatively, you can use a different earning; the delivered VAR BONUS earning is suitable for this purpose, or you can create a new earning.