You can set up your own special Deductions to supplement the many standard
deductions that are set and and maintained for you by CloudPayroll®. Your own special
deductions allow you to easily calculate and deduct any unique deductions
that are used within your organisation.
Tip: Before setting up your own deduction, please check that no
standard deductions already do what you need.
Adding a Deduction
To set up a special deduction follow these steps:-
- Go to your Deductions.
- Press the Add Deduction button.
- Enter a Deduction Code and
The Deduction Code appears in the drop-down list when you add transactions to
timesheets. You should use a short, easy to type, code that you can remember
easily. (If you are used to another payroll system that has deduction codes
or numbers, you may like to use those for your deduction code).
- Press the Add Deduction button.
- Complete the information on the Deduction form and press the
Save this Deduction button.
Information on a Deduction
Each Deduction contains a number of pieces of information that control how the deduction
is calculated and paid.
||Enter a description that will clearly describe to a person what
this deduction is for. This is displayed on peoples timesheets and payslips.
Note: If you include %rate% in your description, it will be replaced
by the transaction's rate on the person's payslip.
||Select the appropriate type from the list. This is the main
way to determine how a deduction is calculated.
- For a deduction with a Fixed Rate, select use Rate Amount from Deduction
and then enter the defined Fixed Rate in the Rate Amount box.
- For an ad-hoc deduction that varies each time it is set up against a person
select use Rate Amount from Deduction,
and then enter 0.0 in the Rate Amount box.
(e.g. PBA - Personal BSB / Account).
- For a calculation that depends on a percentage of a persons earnings, select the
appropriate percentage Calculation rule from the list,
and enter the actual percentage in the Rate Amount box.
- The PAYE and other Tax calc's options are reserved for standard deductions
that are set up and maintained for you.
||This entry depends on the Rate Type selected (above).
- For a Fixed Amount, enter the actual rate to make this deduction at -
if it is always for a fixed amount. (e.g. Union Fees often have a fixed amount).
- For an Ad-Hoc Deduction, made at different rates, enter 0.0.
(e.g. PBA - Personal BSB / Account).
- For a Percentage based rate type, enter the percentage to apply,
(e.g. enter 6.5 for 6.5%)
To override the percentage on individual people,
enter the Rate Amount as 1.0 and then enter the actual percentage for each person into the
Quantity on their timesheet transaction.
||Leave this blank, and an appropriate priority will be generated for
you. (You will only rarely have to change the default priority).
The priority determines the order in which deductions are calculated, paid and displayed
on timesheets and payslips. This order is quite important for standard deductions -
for example tax must be deducted at the appropriate point and a remaining pay
deduction must be made right the the end. Fortunately, the order of your special
deductions is not too important and you will often just accept the default
If you are concerned about the order that deductions are made, review the
priority numbers on
your deduction page
and change them as required. Priorities are significant when a person doesn't have
enough pay to make all their deductions, ones with smaller priority numbers will
be made first.
Select an option to determine how the actual money for this deduction is paid.
- Bank - Select this to include the deduction on the
(Suggestion: Use this option whenever possible).
Leave the Consolidate box empty -
it should only be selected when a separate schedule is sent
to the organisation receiving this money.
- Cheque - Select this option if you prepare a cheque (or otherwise
make payment outside of the payroll system) to send to the organisation receiving
this deduction. The deduction will be reported on the
- Cash - This is reserved for the standard
deductions set up and maintained for you. these are reported on the
- Tax - This is reserved for the standard Tax
deductions set up and maintained for you.
(e.g. PAYG - PAYG Withholding).
Enter the BSB / Account and Lodgement Reference
required for this deduction. (Obviously this is only required where the
Payment Method is Bank). This information will be available from the organisation
you are making this deduction for.
Note: This is only displayed if you have the
Select how this deduction is to be costed. You have four options:-
- Schedule - The deduction will be costed to the
Bank, Tax, Cheque or Tax account code
depending on the Schedule Method chosen (above).
- Fixed - Select here the cost centre that will always be used, (unless
you override it when you are setting up a deduction on a timesheet).
- Template - This allows you to set up a rule that will direct the deduction to the
appropriate cost centre, taking part of the code from the person's cost centre and the
remainder from the template. Enter a ? in each position that should come from the
person's home cost centre.
For example, ????XYZ will construct a cost centre from the
first 4 characters of the person's home cost centre, and append XYZ onto the end.
- None - Select this option and you will always be required to enter the cost centre
setting up a deduction on the person's Timesheet Template.
(Note: This option is not usually necessary, the other options can cater for
almost all requirements).
||Select the one that best describes this deduction:-
- Tax - This is reserved for the standard tax deductions that
are set up and maintained for you.
- Super Subsidy - Select the appropriate option if this deduction
is for a subsidised superannuation scheme. (If the scheme is not
subsidised, use the 'Standard Deduction' option instead). For more information
on superannuation schemes, subsidies and employer's superannuation contribution tax (ESCT),
see the Superannuation Help.
- Other - Select the appropriate option.
- Standard Deduction - You will almost always use this for any special deductions that you set up.
- Pre-Tax Deduction - This deduction will be made before tax is deducted (i.e. it will reduce the Taxable Pay).
- Remaining Pay - This is used internally for the final Bank, Cash or Cheque deductions on a person's timesheet.
- Donation (Payroll Giving) - This is a Payroll Giving
deduction that pays an immediate tax credit back to the person
|Allow Partial Deduction
Tick this box if part of the amount should be deducted, even if the person
doesn't have enough remaining pay to make the entire deduction.
(Note: Always tick this for a reducing balance deduction,
otherwise the final deduction made to clear the balance may not be made).
|Reducing Balance Deduction
Tick this box to make this deduction a Reducing Balance deduction.
These deductions require that you enter a Balance when setting up the deduction.
The deduction will be made as usual, and the balance will reduce. When the balance
reaches zero, the deduction will automatically stop. (Read the
Tax Arrears help for an example of
a reducing balance deduction).