Set Up Negative Earnings: Canada
You can use the PR Earnings Codes form to set up negative earnings. Negative earnings serve as earnings reductions (for example, Registered Retirement Savings Plans).
This topic discusses how to set up negative earnings codes. For more information on setting up true earnings codes, see Setting Up Earnings Codes: Canada.
To determine the taxability of salary reduction plans, consult your plan administrator, appropriate tax laws, or insurance and craft requirements.
- In the PR Earnings Codes form, in the Earnings
Code field, enter a number that uniquely identifies the earnings
code.Note: The numbers you assign to earnings codes determine the sequence in which the system processes earnings. See Determining Earnings Code Sequences for more information.
- In the Description field, enter a description of the earnings code.
- From the Method drop-down, select the method the system users to calculate earnings. See Determining Earnings Code Calculation Methods for more information.
- In the Factor field, enter the number that the system multiplies the
rate by for calculating this earnings code.Typically, you will enter a factor of 1.0.
- Select the Include in
Liability Distributions check box to have the system include the
earnings code in liability distributions to the job.If you do not select this check this box, the system does not distribute the earnings to the job, but the payroll department associated with the employee (PR Employees form) receives the benefit. Do this if you want to reduce the job expenses.
- In the Earnings Type field, enter the earnings type that determines the GL account that the system expenses when updating earnings to GL. Press F4 to select from a list of available earnings types. See About the HQ Earn Types Code Form for more information.
- In the JC Cost Type field, enter the cost type the system uses for interfacing earnings to JC. Press F4 to select from a list of available cost types.
- Use the Limit
Type drop-down to select a limit type for the earnings code.The system enables the Limit for Auto Earnings field.Note: The limit type determines how often the system resets the limit for this earnings code.
- In the Limit for Auto Earnings field, enter the limit amount for automatic earnings. Enter a negative number to calculate the salary reduction appropriately.
- Set up automatic updates to AP, as necessary.
- Determine whether the earnings code needs to be reported on the Record of Employment report. For more information, see Determining ROE Settings for Earnings Codes.
- Associate deductions and liabilities with this earnings code.
- Save the record.
To process negative earnings/salary reductions for a current payroll, run the PR Post Auto Earnings form.