Determining Retro Pay Over 12 Months

To meet this requirement, the PeopleSoft system provides the formula RTO FM SET OVRDSET, which uses the duration RTO DR MTH ARREARS to determine if a period of more than 12 months has elapsed between any of the periods being retroactively paid and the payment date of the retro. If any elapsed period is greater than 12 months, the system selects a new override set—also provided by the PeopleSoft system—to forward all the processed earnings to the single new earning, RETRO12MTH, that the system taxes at the lower rate.

These are lump sum E payments, so the RETRO12MTH earning contributes to accumulator PD LUMP E as well as AUS GROSS, PAYROLL TAX PROV (Provision for Payroll Tax) and its own automatically assigned calendar and fiscal period, month, quarterly, and yearly accumulators.

The system provides one retro processing definition, AU RETRO (which is set to forwarding) and two override sets.

Note:

If you add any earnings that can be retroactively paid, you need to add them to both override sets and to the appropriate accumulators.