Tax Management

This feature allows identifying taxable salary items & configuration of tax

1) Create Taxable Salary Items:
Process:
Settings --> Payroll --> Add Payroll Item
If Payroll Item Already added in the system then go to  Setting --> Payroll--> Payroll Item List
Entry Process:
Here you need to identify this payroll items taxable or not. If this item is taxable then click on taxable. Now you can see a text file name “Tax Information”. Here you will select whether this item is Fully Exempted/Not Exempted /Partially Exempted. If that is partially exempted then you can maximum exempted value.

Example: If Government. set the rate for house rent is 50% of Basic (Yearly) or Tk. 1, 80,000.00 per month which is less exempted from Tax Solution: Now you need to create a Payroll item name House rent, click on taxable & set tax exemption value in partially exempted. Now enter 50% of Basic Amount or maximum amount 180,000 whichever is less is exempted.

2) Tax Rule Setup
Process:
Settings --> Payroll --> Tax Rules --> New Tax Rule
Entry Process:
You need to select Country, male. Now, define age category & mention whether it’s applicable for disable or not.
Set the value for maximum tax rate & minimum tax payment. Now set the value according to tax rules.

Example:
If Govt set the income tax rule is like below. Minimum tax payment amount is 3000.
Total Income
Rate (%)
(Male, below 65 years)
Taka up to 2,20,000.00
0%
Next 3,00,000.00
10%
Next 4,00,000.00
15%
Next 3,00,000.00
20%
Remaining Amount
25%

Then how can I set up tax rule in application?
Solution:
First you need to select country, and then select gender is male. Now set age value 18 to 65. We can easily find the value of maximum tax payment rate is 25% from above table. Set this value in to maximum tax rate & it’s already mention that 3000 is the minimum tax payment.

Now click (+) button and set value 2, 20,000 under income range & set the tax rate 0%. Set the value under income range & tax rate according to above table. Click on save button to complete the tax rule.

3) Tax Calculation
Process:
Settings --> Payroll Schedule --> Active Payroll Schedule
Entry Process:
Tax Calculation automatically done while salary calculation is processed. If you want view detail you can click on tax amount in salary calculation page. Where you can view detail of tax deduction.