Defining company match deduction codes

Company match deduction codes represent a matching contribution to employee-defined contribution plans, such as 401(k) plans in the U.S. This type of deduction is tied to a benefit plan and is considered a Benefit deduction.

  1. Access Deduction (PR05.1).
  2. Define deduction code and description. Use the following guidelines to enter field values:
    Deduction

    The code that represents the deduction.

    (Description)

    The description of the deduction.

    Payment Description

    The description of this deduction that prints on payments.

    Note: If you assign a deduction class to this deduction code, the payment description on the deduction class overrides this payment description.
  3. Select Percent of Employee Deduction in the Calculation Type field.
  4. Define pay information. Use the following guidelines to enter field values:
    Pay Class

    Select a pay class if you want Payroll to calculate the deduction on the pay associated with a specific pay class.

    Note: If you do not select a pay class in this field, the deduction is based on all the employee's wages in a pay period.
    Amount or Percent

    Type an amount or percent. The type you select in the Calculation Type field determines if the system considers the value you type an amount or a percent.

    Currency

    Determine the currency you want Payroll to use to calculate the deduction.

    If the company uses one currency, the company currency defaults to this field.

    If the company uses multiple currencies, the process level currency defaults to this field.

    Note: The employee currency and deduction currency must match for you to be able to assign the deduction to the employee.
  5. Select Company Paid in the Adjust Pay field.
  6. If you want to include this deduction in a deduction class, select the deduction class in the Deduction Class field.
  7. Define deduction processing options. Use the following guidelines to enter field values:
    Priority

    The number that represents the order in which Payroll takes the deduction within the category of Tax Deductions.

    Arrears

    Determines what you want Payroll to do if there is not enough employee pay to cover the deduction.

    Cycles

    Select the deduction cycles in which Payroll takes the deduction.

    You can leave these fields blank for Benefits deductions because the cycles are defined on Frequency Table (BN04.1).

    Note: You can override the value in these Cycles fields for individual employees when you assign the deduction to employees.
  8. Select the deduction you want to base this deduction on in the Matched Deduction field.
    Note: When you calculate earnings and deductions, Payroll verifies the effective date to determine whether or not to take the deduction.
  9. Type the beginning date or the date range that the deduction is in effect in the Effective Date fields. This date or date range can be overridden on the employee deduction.
  10. Type or select the accrual account for the deduction in the Accrual Account field. If you do not select a distribution company, the system uses the deduction accrual distribution company, first from the process level, then from the company, then from the employee record.
  11. If you want to override the accounts defined at the HR Company level, select accounts for the deduction in the Expense Account field. If you do not select an expense account, the system allocates company-paid deduction expenses to the appropriate distribution compaony, accounting unit , account, and sub account number defined on pay codes you type for the employee.
  12. If you use the Project Accounting application, define activity options. Use the following guidelines to enter field values:
    Activity

    The activity to which Payroll associates any deduction expenses.

    Account Category

    The activity category to which Payroll associates any deduction expenses.

  13. Define tax information. Consider the following field.
    Tax Status

    Select Taxable (blank) for pre-tax deductions.

  14. If you use the Accounts Payable application, define AP options. Use the following guidelines to enter field values:
    Update Accounts Payable

    Select whether or not to create invoices for payroll-related payables when you close Payroll.

    Create Invoice by Employee

    Select whether or not to create AP invoices by employee.

    For more information see your Accounts Payable User Guide.

    Vendor

    The vendor you want to use to create Accounts Payable invoices for this deduction.

    Note: Click the Addl Vendors button to define vendors and process level combinations for this deduction.
    Remit To

    Remit To identifies a vendor location where payments are to be remitted. This field populates the Remit-To-Code on AP invoice records Basic Invoice (AP20.1)via the AP interface.

    If you use this field, the payment address comes from Vendor Location (AP10.2). If this field is left blank, the payment address defaults from Vendor (AP10.1).

    Remit To can be defined for:

    • An individual garnishment on US Employee Garnishment (PR26.1)or Canada Employee Garnishment (PR47.1).

    • An individual process level override within deduction on Additional Vendors (PR05.3).

    • An entire deduction on Deduction (PR05.1).

      If you use this field, you must also select a vendor in the Vendor field.

Related reports and inquiries

To Use
List deductions Deduction Listing (PR205)
List frequency tables Frequency Table Listing (BN204)
Related topics