Pre Tax Deductions

PurePro system allows users to create and process “Pre-Tax Deduction” rates. As the name suggests, these deductions are deducted from the worker’s gross pay prior to PAYE deductions and as such are excluded from the taxable income.
To setup a “Pre-Tax Deduction” rate, following conditions must be satisfied: -
    The rate should be of category “Deduction”
    The “Payroll Rule” for the deduction must be “Taxable”
The existing rates for “SIPS” (created before October 2024) would be automatically updated to use the new “Pre-Tax Deduction” flag, where the above mentioned conditions apply.

Setting Pre-Tax Deduction rate 

Users can update existing rates or create new rate. To create a new rate, please follow these steps: -
    Navigate to Admin -> Rates
    Create new Rate
    Add the required information
    Select the Rate Category = Deduction and the required Sub-Category
    Select a payroll rule which is “Taxable”
    Enable “Pre-Tax Deduction” from the options available
    Provide the required Information
    Save the rate
This rate can now be used to create “Pre-tax” deductions for workers
Users can also update existing rates [1].
To update an existing rate, please follow these steps: -
    Navigate to Admin -> Rates
    Search and edit the required rate
    Update the rate category to be “deduction” if required
    Update the payroll rule to be “taxable” if required
    Enable “Pre-tax Deduction” from the options available
    Click update
Users can edit existing deduction rates, but only will be able to view the pre-tax option if the payroll rule set in the rate has the taxable option enabled.

Adding Pre-Tax Deduction

To create a Pre-Tax deduction for a worker, follow these steps:
    Navigate to Payroll → Deduction
    Select a worker
    Select the "Pre Tax Deduction Rate" under "Rate"
    Click on "Add Row" under "Transaction"
    Add relevant details, as required
    Click "Save"
Users can process backdated deduction by selecting a previous period under "Transactions".

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