How do I set up a holiday credit scheme?

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Summary

This article explains how to setup holiday credit schemes in your Platinum system.

More Information

The Holiday Credit Scheme allows employees to set aside a percentage of their Gross Pay each Payroll Period. This is similar to a savings scheme and is often used in the textile industry. The employee can then draw on this fund when they take a holiday. Alternatively the employer can set an amount aside, which the employee can draw on when they take a holiday instead of receiving holiday pay.

Settings

Go to " Payroll Maintenance Options Payroll Settings Holiday Credit Scheme".

  • You will see a screen that includes the following prompts:
                            Holiday Credit Scheme

             Default Rate : 00.00%

      In Addition To Pay? : N (Y/N)

  Pay Tax When Set Aside? : N (Y/N)

Default Rate

  • Enter the default percentage to be set aside from an employees pay, each time a Payroll Period is run.
The default rate will only be applied to new employee records. If existing employees wish to join the scheme, their records will need to be edited individually to input the percentage to set aside. (See here)

If any employees do not wish to join the Holiday Credit Scheme, you will need to return the default value to zero in their record.

In Addition To Pay?

  • Enter <Y> for Yes if amounts set aside are a percentage of the employee's gross pay, which are set aside by the employer, and are not deducted from the employee's pay.
  • Enter <N> for No if amounts are to be deducted from the employee's gross pay.

Pay Tax When Set Aside?

  • Enter <Y> for Yes if the amount set aside is to be included for tax at the time it is set aside. If employees can withdraw savings at any time, in general, this option should be used.
  • Enter <N> for No if employees are to pay tax on the amount they withdraw. This should be used if the employee can only withdraw from their Holiday Credit savings when they take a holiday.

Making Payments to an Employee

The Holiday Credit Scheme is automatically listed on the Period Adjustments available to your company (see here).

To make a payment to an employee from their Holiday Credit Savings, you will need to enter the amount to pay the employee in the Period Adjustment headed "Hol. Credit" (see here).

See also


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Keywords AND Misspellings
holiday, credit, scheme