Additional Social Insurance Implementation for Kuwait

Before you run a country specific payroll process you need to setup the earnings and deductions required for processing the payroll run.

You need the following roles and license to implement the additional social allowances:

• You need a role of a Payroll Manager.
• You need a payroll license for Kuwait.
• You need one legislative data group already existing for Kuwait for which the additional social insurance deductions are being setup.

Overview

Kuwait social insurance authorities can request by a formal letter that additional monthly social insurance deductions be deducted from an employees pay. The employee must already be subject to standard social insurance deductions before any additional social insurance can be levied.

To calculate and deduct additional social insurance from an employee, a set of payroll definitions need to be created, supporting the additional social insurance deductions. The Elements task is used to create the element and the related payroll definitions such as balances, formulas, and the calculation component that's tied to these definitions. The name of the element is used as a prefix for all the related payroll definitions such as balances, formulas, and so on, as well as the name of the calculation component that can be assigned to an employee to trigger the deduction.

Each employee that's subject to additional social insurance needs the appropriate additional social insurance calculation component added as a child component to their employee social insurance details calculation component. The Calculation Cards task is used to associate the calculation components for an employee and also gather the information required to process and report the deductions.

Additional social insurance deductions are made automatically each month during payroll processing and are triggered by the calculation component assigned to the specific employees. The calculation component represents each additional social insurance deduction assigned to the employee. These deductions will continue until the total amount has been recovered. An employee can be subject to more than one additional social insurance deduction at any given time.

Once calculated, the results for the employee can be viewed on the employees Statement of Earnings (SOE), payslip, and the statutory reports such as Report 167, Report 166 and Report 103. The element name associated with the additional social insurance deduction will be used in the SOE and payslip; while the statutory reports use the deduction codes linked to the Insurance type to identify specific amounts for reporting purposes.

Creating Supporting Payroll Definitions

The Elements task uses a questionnaire to gather info which is used to create all the supporting payroll definitions such as elements, balances, formulas, and the calculation component required to process additional social insurance deductions. Follow the steps detailed below:

1. Navigate to the Payroll Calculations work area.
2. Select Elements task from the task list and click Create.
3. Select an existing Kuwait Legislative Data Group for which you want to define the additional social insurance deduction.
4. Select Social Insurance Deductions in the Primary Classification field.
5. Select Additional Social Insurance in the Secondary Classification field.
6. The Category will be defaulted to Social Insurance Deduction.
7. Enter a Name for the element.
   Note: This name is used as the prefix for all the related supporting payroll definitions that are created.
8. Enter a Reporting Name. This name is shown when the element is displayed on reports.
9. Enter a Description for the element.
10. Enter the Effective Date from which the element can be used.
11. The Input Currency is defaulted to Kuwaiti Dinar. All other values are defaulted and should be left unchanged.
12. The review page summarizing the values entered will be shown and if OK click Submit to create the element and its associated payroll definitions. Review and correct the information before submitting.
13. The breakup of what is created is shown on the Element Summary page. Click Done when finished.