Additional Salary

Other compensation is any payment or deduction that an Employee gets from the Company that isn't their regular compensation. It is changes or variable amounts that can be made from time to time or on a random basis, depending on corporate guidelines or how well the worker does.

Frappe HR offers a function called "Additional Salary" that lets HR and Payroll users add or take away extra amounts for a specific employee while they are performing Payroll. After the Payroll Entry is made, these adjustments are automatically reflected in the right Salary Slips.

Here are some examples of Extra Salary

Bonus for good work
Late payments from previous months
Payment of incentives or commissions
Bonus for finishing the project
Allowances for Deputation or Outstation
Bonus for Keeping
Recovery of salary adjustment or reimbursement
Deductions from your pay cheque in advance or loan recovery

To make More Salary, go to:Home > Human Resources > Payroll > Extra Pay

1. Requirements

Before you construct an Additional Salary record, ensure sure the following records are previously made and set up correctly:

Worker

Make that the Employee record is in the system and is active. During the time when the Additional Salary will be executed, the employee must have a valid Salary Structure Assignment in place.

Part of the salary

There should already be a Salary Component that is similar to the type of Additional Salary you want to add. "Performance Bonus" or "Arrears Pay," for example, would need to be set up as an Earning Component. "Loan Recovery" or "Salary Advance Adjustment," on the other hand, would need to be set up as a Deduction Component.
You can also choose these parts based on what your organisation wants, such as "Is Tax Applicable" or "Round to Nearest Integer."

2. Making an Extra Salary

Go to the Additional Salary list and click on New.
Pick Employee.After you choose, basic information like Company, Department, and Branch will be automatically gathered.
Pick a Salary Component.Choose the earning or deduction part that applies to the purpose of this change.
Type in the amount.Type in the total amount of the extra income or deduction. You can enter a negative number or specify a Deduction Component for deductions.
Type in the date of the payroll. This date tells you when to use the extra pay.If the Payroll Date falls inside the current Payroll period, ERPNext will automatically use it in the next salary Slip that is processed.
Fill in the other information as shown above, then click Save and then Submit the record.
You can choose the following checkboxes to have even more control over how the money is handled:

Overwrite Salary Structure Amount Turn this on if you want this extra part to replace (not add to) the number of parts currently listed in the Salary Structure. This option will only apply the new value if the employee has a normal "Travel Allowance" but you want to change it for a specific month.

Deduct Full Tax on Selected Payroll Date: Turn this on if you want to take the complete tax out of this extra amount in the same month that it is being applied. This is helpful for things like bonuses or special incentives if the company wants to deal with tax deductions earlier rather than spreading them out over the balance of the months of the fiscal quarter.

Once you save and submit this Additional Salary item, ERPNext will automatically connect it to the right Salary Slip when it processes payroll.

3. Characteristics

3.1 Extra Salary That Happens Again and Again

With ERPNext, you can set up Recurring Additional Salary entries for payments or deductions that happen every month or on a regular basis.
You need to fill out the following fields when the "Is Recurring" option is checked:

From Date: The date when the extra amount starts to apply.

To Date: The date by which the extra amount is no longer valid.

When you make Payroll, the Additional Salary that you set up will be added to all Payroll Slips that fall within the date range you set. This is helpful for things like:
Temporary Deputation Allowance
Bonus for a Long-Term Project
Plan for Monthly Rewards
Car allowance or reimbursement for a mobile phone
The system will stop adding the Additional Salary to subsequent payrolls automatically after the recurrence period ends (i.e., after the To Date). There is no need for anybody to do anything.
If an employee's qualification status changes, they can update or cancel a recurring Additional Salary record at any time. Audit logs also keep track of these kinds of changes to make sure they are in line with the rules.

3.2 Integration of Payroll and Salary Slip

When you submit a Payroll Entry, ERPNext immediately takes up all the Additional Salary entries that fall within the Payroll Date range and the Employee.
The sums for Additional Salary management are added (for Earnings) or taken from (for Deductions) from the Salary Slip of the employee in question.
It also takes care of processing several currencies for employees who work in subsidiaries or branches in other countries. It does this by automatically picking up exchange rates based on the Payroll Date.
If "Deduct Full Tax" is turned on, the tax effect of the extra amount will be computed directly in that month's Payroll. This will make sure that the tax requirements are met.

3.3 Auditing, following up, and reporting

All Additional Salary records have a full audit trail that shows who created, approved, and changed the record.
HR and Finance can see all current and past Additional Salary entries in list view, with the option to filter by date, employee, or component.
Payroll Reports and Tax Projections also show these transactions so that they can be checked against each other.
ERPNext's built-in Additional Salary Report lets you look at all of your ad hoc payments or deductions over a certain time period.

Additional Salary