Deduction codes

Deduction codes are used for these functions:

• Storing deduction history by employee
• Determining how taxes are calculated based on tax provider code or tax category
• Determining the deduction description that is printed on payment stubs or deposit receipts
• Impacting net pay, depending on the adjust pay value:
  • If the adjust pay value is specified as employee-paid, net pay is reduced.
  • If the adjust pay value is specified as company-paid, there is no effect on net pay.
  • If the adjust pay value is specified as add-to-net, the deduction amount is added to net pay.
• Posting accruals and company-paid expenses to the general ledger
• Posting vendor information to accounts payable
• Applying deferred compensation, maximum compensation, and annual additions limits

Deduction codes can be attached to multiple deduction classes.