Grossing-Up Employees' Salaries
We're excited to announce that we have added a new option to Egypt’s Payroll Setup that allows you to “Gross-up employees’ salaries”. You can now calculate employees' Gross Salary based on the Net Salary in their salary package and also add the Net amount of bonuses or any other one-time financial transactions to an employee’s salary.
The gross-up amount will cover any tax and insurance deductions and will be shown on the employee salary slip.
TABLE OF CONTENTS
- Grossing-Up Employees' Salaries.
How to Activate Salaries Gross-Up
Payroll Setup
User Menu → System Preferences → Financial Setup → Payroll Setup
To activate this feature, on the Payroll Setup page, under the Grossing-Up Salary section, activate the toggle “Grossing-up employees' salaries.”
Once the option is activated, select a Gross-up financial transaction type from the drop-down list. The financial transaction type you choose will be used as a Gross-Up transaction for the calculated salary slips.
*Please note that the Gross-up financial transaction type drop-down list will only show taxable income one-time financial transaction types.
Methods of Calculating Daily Rates When Grossing Up Salaries
Within the Grossing-Up Salary section, there’s an additional option that provides you with the flexibility to choose how you’d like to calculate your employees' daily rates while grossing up their salaries.
There are 2 options: the first option involves basing your daily rate calculations on the employees' Gross salary, while the second option uses the Net salary to calculate the daily rate.
The selected method of calculation will be used to determine the daily rate for all employees with a "Net Salary" package type within the branch. This method will be used in the following calculations:
1. Hiring and termination differences
2. Unpaid vacation differences
3. Overtime
4. Vacation compensation
Notes: Employees with a salary package type of "Gross Salary" will not be impacted by this option.
Add Overtime Batch as Income & Import Overtime Batches in the Manage Overtimes page will always be based on the Net salary.
Employees’ Salary Package
Main Menu → Employees → Employee Affairs → Employee Management
On the Employee Management page, click the employee name, then in the Salary Package section, click “Create”. You will then be able to create one of the two salary package types: Gross salary or Net salary.
If you select “Gross salary,” you need to insert the Basic salary, and the system will calculate the Net salary accordingly. However, if you choose Net salary, you will need to insert the Net salary for the employee, and the system will then automatically calculate the employee’s gross salary and add a gross-up to account for any deductions.
How to create a “Net salary” package type for an employee:
Go to the employee’s profile and click “Create” to create a new package for an employee.
Select “Net salary” as the salary package type.
Enter the employee’s Net salary in the Basic salary field.
Add any recurring transactions the employee has and add their net amount in the Amount field.
Fill in any additional financial information for the salary package, then click “Create”.
*Please note that you can only change the salary package type for an employee if the effective date of the package is on the first day of the month.
How to View Employees’ Salary Package Type
Salary Packages Screening Page
Main Menu → Employees→ Employee Affairs→ Employee Management → Salary Packages Screening
On the Employee Management page, click the more button “...”, and select Salary Packages Screening. You can then view the Salary Package Type column that has been added to the Salary Packages Screening page.
Transaction Details of Salary Packages Screening
Main Menu → Employees→ Employee Affairs → Employee Management → Salary Packages Screening → Transaction Details
A new row has been added to the transaction details of salary packages to allow users to view the salary package type for employees.
Salary Packages Report
Main Menu → Reports → Financial Reports → Salary Packages Report
A new column has been added to the Salary Packages Report to show the salary package type of employees’ salary packages.
Adding One-Time Financial Transactions to Employees with Salary Package Type “Net Salary”
Adding One-Time Financial Transactions
Main Menu → Payroll → Manage Financials → Manage Financial Transactions →Add New Financial Transaction
When adding new financial transactions to employees with salary package type “Net Salary”, a new option called “Transaction amount type” will appear after selecting the employee’s name and the Effective date. This option will enable the user to choose to add the financial transaction to the employee as a Net amount or as a Total amount.
Adding a Financial Transaction as a “Total amount”
If you choose to add the financial transaction to the employee as a Total amount, the system will automatically calculate the Gross salary for the employee based on the Net salary specified in their salary package and add the transaction’s amount to it.
Adding a Financial Transaction as a “Net amount”
If you choose to add the financial transaction to the employee as a Net amount, the financial transaction’s amount will be added to the employee’s Net salary during the salary calculation, and the Gross salary will be calculated accordingly.
*Please note that financial transactions requested by employees will be “Total amount” by default regardless of employees’ Salary Package Type.
Importing One-Time Financial Transactions
Main Menu → Payroll → Manage Financials → Manage Financial Transactions
On the Manage Financial Transactions page, click the “+” button then click “Import Financial Transactions”. A popup will apear, allowing users to choose the Financial Transaction Types and Transaction Amount Type of the imported financial transactions. This option will enable the user to add the financial transactions to the employees in the sheet as a Net amount or a Total amount.
Using the Importer to Add Financial Transactions as Total Amount
If you choose to import the financial transactions in the sheet as a Total amount, the system will automatically add the number of financial transactions to the employees’ Gross salary during the salary calculation.
Using the Importer to Add Financial Transactions as Net Amount
If you choose to import the financial transactions in the sheet as a Net amount, the system will automatically add the number of financial transactions to the employees' Net salary during the salary calculation, and the Gross salary will be calculated accordingly.
If there are any records in the imported sheets for employees with the salary package type “Gross salary”, these records will be dropped, and the financial transactions will only be added for employees with salary package type“Net salary”.
*Please note that you cannot activate the “Deduct tax from transaction amount” option while adding or importing financial transactions to employees with the salary package type “Net salary”.
How to View Financial Transactions Amount Types
Manage Financial Transactions
Main Menu → Payroll → Manage Financials → Manage Financial Transactions
A new column called “Transaction Amount Type” has been added to the Manage Financial Transactions page. It will show whether the financial transaction’s amount type is the Total amount or Net amount.
Financial Transactions Report
Main Menu → Reports → Financial Reports → Financial Transactions Report
A new checkbox called Transaction amount type has been added to the Financial Transactions Report. Once this box is checked, a Transaction amount type column will then be added to the report.
*Please note that any financial transactions added due to Gross-Up will have the Transaction amount type “Total amount” by default.
How to View the Calculated Gross-Up
Salary Slips
Main Menu → Payroll → Manage Financials → Manage Salaries
Once the feature is activated and the user calculates the salary slips, the gross salary will be calculated for all employees with Net Salary Package Type, and the Gross-Up will be automatically calculated and added as a financial transaction type to account for deductions due to taxes and insurance.
Manage Financial Transactions
Main Menu → Payroll → Manage Financials → Manage Financial Transactions
Each time Gross-Up is calculated in salary slips, a Financial Transaction record will be automatically created in the Manage Financial Transactions page on the In-Payroll Financial Transactions tab. These records will have the status “Gross-Up” in the data table and cannot be edited or deleted by users. They will, however, be automatically deleted if the related salary slip was rejected or deleted.
*Please note that the effective date for financial transactions calculated due to Gross-Up will always be the first day of the calculated salary month.
Financial Transactions Report
Main Menu → Reports → Financial Reports → Financial Transactions Report
You can view the calculated Gross-Up in the Financial Transactions Report by selecting “Gross-Up” in the Approval status filter.
