Setting Up Tax Calculation Rules

Access the Tax Rule Revisions form.

Rule Type

Enter the rule type for this payroll tax rule.

Input Used

Enter the input number that this rule is to use for its calculation. This option is used in rule-based payroll taxes for Australia and New Zealand.

Sign Result

Enter the sign of the result for this rule calculation. This field is used in rule-based payroll taxes for Australia and New Zealand.

Gross Wage Number

Enter the input number for the gross wage figure to be used by this rule. This number is used when a rule specifies that another rule has to be recalculated.

Level Calc (level calculation)

Enter the level of calculation to be used for the current payroll tax rule.

Output No. (output number)

Enter the output number that the calculation result for the current tax rule will be written to. This value is used in the payroll tax rules for Australia and New Zealand.

Work Tax Area

Enter a code that identifies a geographical location and the tax authorities for an employee work site, including employee and employer statutory requirements. In the Vertex payroll tax calculation software, the tax area code is synonymous with GeoCode. To determine the valid codes for the location, refer to the documentation for the tax calculation software that you are using.

T T(tax type)

Enter a code that specifies the type of payroll tax that is being processed. This is a UDC (07/TX). To set up state minimum wage amounts, you must enter MW in this field. To do so, you must first add MW to UDC 07/TX. However, you should not change the codes and definitions that are provided with the software.

Rate Code

Enter the rate code to be used when calculating this rule. This is usually the same as the tax scale code unless a secondary scale or a specific field test is to be applied.

Override Rate

Enter the rate at which the rule is calculated and overrides all other rates for this rule. This field is used in the payroll tax rules for Australia and New Zealand.

If you enter a value in the Override Rate field, all earnings that are associated with this tax rule are taxed at this rate. To use the rates that are associated with a set of tax parameters, you must enter the Tax Parameter Code in the Rate Code field.

Ins\Upd Recs

Select this option if a record is to be written to the Tax Detail File table (F07353) for this rule, instead of being used as a work amount. This option is used in rule-based payroll taxes for Australia and New Zealand.

Threshold Value

Enter a quantity that the system compares against accumulated sales volume to determine whether a rebate should be awarded. You can define thresholds as quantities, weights, or sales amounts. Use the Level Break Type field in the adjustment definition to define the type of threshold.

Threshold Type

Enter a code that indicates that the threshold is in either number of units or amount. Depending on the type that you indicate, the threshold field is titled either Threshold Units or Threshold Amount.

G E(gross pay type)

Enter a code that indicates whether the pay type is added to, subtracted from, or does not affect the employee's gross pay. Values are:

+: Pay type will be added to the employee's gross pay.

−: Pay type will be subtracted from the employee's gross pay.

Blank: Pay type will not affect the employee's gross pay.

A pay type should not have a negative effect on gross pay. If you set up a pay type to have a negative effect on gross or net pay, gross-to-net errors appear on the Payroll Register. We recommend that you set up a deduction instead of a pay type that would have a negative effect on gross pay.

When you set up a pay type with no effect on gross pay and a positive effect on net pay, do not create a separate check. A separate check will cause a gross-to-net error.

Incorp YTD (incorporate year-to-date)

Select this option if the rule should include the year-to-date figure in the threshold calculation. This option is used in rule-based payroll taxes for Australia and New Zealand.

Re-calc Input (recalculate input)

Enter the input number to be recalculated as a result of calculating the current rule. This field is used in the payroll tax rules for Australia and New Zealand.