Creating deduction codes

  1. For payroll administrators, select Payroll Administrator > Setup > Deduction Structure.

    For administrators, see the information about creating deduction codes in Infor HR Talent Setup and Administration Guide.

  2. Click the Deduction Codes tab.
  3. Click Create.
  4. Specify the header of the deduction code to create. Specify this information:
    Deduction Code
    Specify an alphanumeric name of the deduction code. Optionally, specify a description of the deduction code.
    Deduction Type
    Select a deduction type of the deduction code:
    • Benefit: This deduction type is used to track employee and company contributions to benefit plans on a pay period basis.
    • Loan: This deduction type is used to track deductions to employee pay for loanable gratuity pay.
    • Garnishment: This deduction type is used to track garnishment amounts deducted from employee pay.
    • Tax: This deduction type is used to track income tax deductions made to employee pay
    • Other: This deduction type is used for multiple deductions created for the same employee.

      If the original deductions are with open end dates, then you can create a new deduction with a start date later than the original deduction start date. The original deduction is ended automatically.

      The end date for the original deduction is automatically added with the day before the begin date of the new deduction.

      A new deduction cannot have a date range, beginning date, or end date within an existing deduction's date range.

    Begin Date
    Specify a begin date of the deduction code.
    End Date
    Optionally, specify an end date of the deduction code.
    Active
    Select this check box if the begin date and end date of the deduction code is active.
    Country/Jurisdiction
    Specify a country of the deduction code.
  5. Specify this information on the Detail tab:
    Adjust Pay
    Select which party is responsible for the cost of a deduction code that is assigned to an employee:
    • Employee Paid: The deduction is paid by the employee.
    • Employer Paid: The deduction is paid by the company.
    • Add to Net: The amount is added to net pay and is used to reimburse employees for expenses or to apply earned income credits.
    Calculation Type
    Select a calculation type of the deduction code.

    Select Custom Calculation to calculate the deduction code that you link to a custom compute. This option is available if you create a custom compute with an EmployeeDeduction business class and HCMComputeDeductionCode subject.

    See Creating custom computes and Adding a subject to custom computes.

    Currency
    Specify which currency to process the deduction code.
    Amount
    Specify an amount to process the deduction code for a specific amount of the employee's income.
    Percent
    Specify a percentage to process the deduction code for a percent of the employee's income.
    Custom Compute
    Select a custom compute to link with the deduction code.
    Exclude from Garnishment Disposable Income
    Select this check box to exclude the deduction code from the calculation of disposable income in the garnishment rule.
    Print Indicator
    Select this check box to print the payment description and deduction payment group of the deduction code.
    Payment Description
    Specify a payment description of the deduction code.
    Deduction Payment Group
    Specify a deduction payment group of the deduction code.
  6. Specify this information on the Processing Rules tab:
    Process Rule
    Select a process rule of the deduction code.
    Pay Class
    Specify a pay class to associate the deduction code with the process rule.
    Monthly Limit
    Specify a monthly limit to the deduction code.
    Payment Limit
    Specify a payment limit to the deduction code.
    Worker Compensation Rate Table
    Select this check box to set up the workers compensation rate to the deduction code.
    Priority
    Specify a number to indicate the priority for the process rule.
    Cycle 1 to Cycle 9
    Optionally, select whether to Take Deduction or Update Taxable Only to the deduction codes.
    Arrears
    Select the outcome if there is not enough net pay to take the full deduction amount on a payment:
    • If you select a value that includes Net to Zero, then as much of the deduction as possible is taken until the net pay equals zero.
    • If you select a value that includes Create Arrears, then arrears deductions are created to be taken on a future payment.
    • If you select a value that includes No Arrears, then no arrears deductions are created.
    • If you leave this field blank, then the value that is defined on the deduction code is used.
    Process Arrears
    Optionally, select this check box to process arrears of the deduction code.
    Maximum Arrears To Process
    Optionally, specify the maximum number of arrears to process per pay cycle.
  7. If you specified a deduction type of Tax, then specify a value for these fields on the Tax tab:
    • Tax Authority
    • Additional Tax Code
    • Self Adjust Tax
    • Tax Provider Formula Number
    • Reciprocal Formula
    • Wage Indicator
  8. If you specified a deduction type of Garnishment, then specify a value for any relevant fields on the Garnishments tab.
  9. Click Save.
  10. If you specified a tax category of Payroll Expense Tax, then specify a value for these fields on the Estimated Gross Wages tab:
    • Legal Entity
    • Estimated Quarterly Wage (USD)
    • Estimated Annual Wage (USD)
  11. Click Save.