Annual or Hourly salaries can be saved in NET as opposed to Gross, by toggling the below button in the employee position history. We recommend that you save your salaries in gross, but in the scenario where you need to use this feature, get in touch with us by sending an email to firstname.lastname@example.org and we will be able to enable this function for you.
You need to ensure that you have the Manage payroll and Manage Employment Position History permissions.
How to set it up
To switch this on, go to People, select the desired employee and click on his/her position. From there, click on the edit button of the most recent position and go to Remuneration package:
The salary shown here will be the average gross salary:
Within payroll you will then notice a Net to Gross correction. This is there to average out the salary up till the end of the year. The Net to Gross correction is taxable.
Net to Gross Correction
The net to gross correction amount is taxable. The workings on Net field on the payslip dialog show more detail to explain how the Net is being calculated.
How it works: After net is calculated, we check what the desired net is and we calculate the difference known as net-to-gross correction.
Then the correction is applied to the payslip as a 100% taxable adjustment and the payslip is then recalculated bearing the correction in mind.
Therefore, the resulting net is equivalent to the desired net + tax portion of the correction (keep in mind that the correction can be negative).