Create Earnings Element for India

This example shows how to use the element template and create a regular earnings element for India. Use the Elements task in the Compensation section of My Client Groups to create the element.

Let's look at the tasks required to create an earnings element:

1. Create the earnings element

2. Create the eligibility record for the element.

Note: Set the Product Offering to India before creating the Earnings template.

To create an earnings element:

1. From your Home page, navigate to My Client Groups > Show More.

2. In Payroll tasks, click Elements.

3. On the Elements page, click Create.

4. Complete these fields, as shown in this table:

   Field	Value
   Legislative Data Group	Select an appropriate LDG.
   Primary Classification	Earnings
   Secondary Classification	Standard Taxable Earnings
   Category	Standard Taxable Earnings

5. Click Continue.

6. On the Basic Information page, complete the fields, as shown in this table:

   Field	Value
   Name	Enter a name, example: Standard Earnings1
   Reporting Name	Enter the name that you want to display on reports for this deduction payroll element.
   Effective Date	Enter an early date so that the payroll element is available for use immediately.
   Input Currency	Indian Rupee
   Should every person eligible for the element automatically receive it?	No
   What is the earliest entry date for this element?	First Standard Earning Date
   What is the latest entry date for this element?	Last Standard Earning Date An element's latest entry date decides how element entries process after a person leaves from organization or transfers to another payroll. This is before a pay period end date. If you select this date, then you need to enable proration, so the calculation will be correct if a person leaves.
   At which employment level should this element be attached?	Assignment Note: Assignments are associated with jurisdictions, which determine the required tax calculations.
   Does the element recur each payroll period, or does it require explicit entry?	Recurring
   Process the element only once in each payroll period?	Yes
   Can a person have more than one entry of the element in a payroll period?	No
   Process and pay element separately with other earnings element?

7. Click Next. On the Additional Details page, respond to the questions, as shown in this table:

   Field	Value
   What is the calculation rule?	Flat amount.
   Is this element subject to proration?	Yes
   Proration Group	Select a proration group.
   Proration Rate	Select a proration rate.
   Proration Units	Workday
   Is this element subject to retroactive changes?	No

8. In the Earnings Rules, select the Earnings Type as Basic Salary for creating a standard earnings element.

9. In the Earnings Rules, select the Earnings Type as Others and answer the India specific earnings questions to create the required balance elements.

   Question	Value
   Does this element determine the Employee State Insurance eligibility?	Select Yes or No as required.
   Does this element contribute to Employee State Insurance computation base salary?	Select Yes or No
   Does this element contribute to Provident Fund computation base salary?	Select Yes or No
   Does this element contribute to Company Accommodation valuation salary?	Select Yes or No

10. Click Next twice. Verify that the information shown on the Create Element: Review page is correct.

11. Click Submit.

On the Element Summary page, update the newly created element details.

1. In the Element Overview section, select Element Eligibility.
2. Select Actions and then Create Element Eligibility.
3. In the Element Eligibility Name field, enter a name for the eligibility record.
4. In the Eligibility Criteria section, select any criteria if you want to restrict who can pay this deduction. Or else, select All payrolls eligible.
5. Click Submit. All the associated balances, feeds, input values, formulas, and related elements required for payroll processing gets created automatically.

What to do next

By default, whenever an Earnings element of earnings type: Basic Salary is created, the below balances are automatically fed:

• Termination allowances

  • Gratuity Computation Salary

  • Leave Encashment Computation Salary

The Retrenchment Compensation Computation Salary balance requires as input the Pay value of the Results element of the earnings element.

The PT Computational Salary for <State/Panchayats/Corporation> balance requires as input the Pay value of the Results element of the earnings element.

The PT Computational Standard Salary for <State/Panchayats/Corporation> balance requires as input the ‘Standard Value’ of the Results element of the earnings element. For more information, see Balances in Professional Tax Calculations.