Understanding Retroactive Tax Processing

Global Payroll for Australia provides payroll rules and elements to calculate taxes on additional payments that are granted retroactively. An additional payment can include a:

• back payment (including lump sum payments in arrears)

• commission

• bonus or similar payment.

In this section we discuss the retroactive tax calculation methods, the key PeopleSoft delivered elements used to calculate retroactive taxes, and the inputs that users must make to ensure correct retroactive tax processing.