Setting up deductions with KeyPay
KeyPay allows you to simplify clients’ payroll by setting up deductions which can be automatically paid to a bank account or super fund as well as set to automatically expire after a certain date or time.
*Note: This article has been written in relation to deductions on behalf of Australian clients. For other regions, take a look at the support articles linked at the end of this article.
Getting started with deductions
The first thing you and your clients need to do to start using deductions is to set up your deduction categories. This allows you to set up specific deduction categories which can be tailored to the needs of clients and their businesses.
To setup a deduction category:
1. From the “Payroll Settings” menu, go to the "Pay Run Settings" area and select “Deduction Categories”.
2. KeyPay will already set up 3 basic deduction categories (FBT, Pre-Tax Deduction and Post-Tax Deduction); these can be edited by clicking on the name of the deduction category. To add a new deduction category, click the green “Add” button in the top right corner.
3. Enter a name for the deduction category and select whether it will be a pre or post tax deduction and click save.
Once deduction categories have been set up, they will now be available to be assigned to employees.
Setting up an indefinitely recurring deduction
Follow these steps setup a deduction that recurs indefinitely:
1. Find the employee that you want to create the recurring deduction for and under the “Pay Run Settings” section click “Pay Run Inclusions”.
2. You'll then be taken to the following screen:
3. Click 'Add' on the right side of 'Deductions' and complete the following details:
- Select the appropriate deduction category from the drop down list.
- Enter the deduction amount to be applied per pay run. It can be a Fixed amount, a Percentage of Gross earnings or Percentage of OTE.
- Select whether the deduction should be paid manually, to a super fund, a bank account or via a BPAY account. If you are setting up salary sacrifice super or member voluntary, select the super fund option, then select the fund. To pay this deduction directly into another bank account, via the ABA file from the pay run, you'll need to have first set up the bank account on the employee's record / bank accounts page (set the amount to pay as Fixed and $0) so you can choose this bank account from the drop down list and you can add a 'reference' in the Payment Reference field. Additionally, to pay the deduction via a BPAY account, you'll need to have first set up the BPAY account on the employee's bank accounts page (set the amount to pay as Fixed and $0) so you can choose this BPAY account from the drop down list.
- Please note - Child Support Agency (CSA) deductions require the employee's reference number to be entered in the Payment Reference field (when you set up the deduction on the employee's pay run inclusions page).
- Enter any notes that you want the employee to see on their pay slip.
- Enter the date this inclusion is to commence.
- Choose when this inclusion should cease (a specific end date, never or once a particular dollar amount has been reached).
- Click Save
Now, the next time a pay run is processed that includes this employee, the deduction will automatically appear:
Checking the status of a deduction
You can quickly see the status of expiring deductions by coming back to the employee Pay Run Inclusions screen.
Once you’ve setup your deductions, a summary of the deductions will be displayed which will include:
- The amount or date at which the deduction will expire
- The start date of the deductions
- Whether or not the deduction has actually expired
- For amount based deductions, the current amount that has been paid
- The payment type setup for this deduction
N.B. A deduction expiry date means "will not be included in pay runs where the pay period starts after this date" and NOT the date paid.
To find out how to set up deductions for clients in different regions, take a look at our support articles here: AU | NZ | UK | SG | MY