The Apply Deductions Rule is used to specify which deductions the application calculates and applies. The deductions specified by the rule are calculated by the application and subtracted from employee pay.
For example, an instance of the Apply Deductions Rule can subtract a flat amount of $50 to cover a gym membership and calculate 2% of an employee's regular earnings and subtract it for long term disability insurance payments.
Each deduction's configuration defines how the application calculates the deduction amount, such as a flat amount of $50 or a percentage of an employee's regular earnings. The rule just specifies which deductions are calculated and applied.
Apply Deductions Rule Parameters
Eligible Tax Type (USA)
Select which tax types are applied. The application applies any deduction with the specified type unless it is specifically excluded by the Ineligible deduction parameter.
Leave blank and the rule does not consider tax types when determining which deductions to apply.
Ineligible Tax Type (USA)
Select which deduction tax types are excluded. The application does not apply deductions with the specified type unless specifically included by the Eligible deduction parameter.
Leave blank and the rule does not consider deduction types when excluding deductions.
Eligible Tax Type (Canada)
Select which tax types are applied. The application applies any deduction with the specified type unless it is specifically excluded by the Ineligible deduction parameter.
Leave blank and the rule does not consider tax types when determining which deductions to apply.
Ineligible Tax Type (Canada)
Select which deduction tax types are excluded. The application does not apply deductions with the specified type unless specifically included by the Eligible deduction parameter.
Leave blank and the rule does not consider deduction types when excluding deductions.
Eligible deduction
Select the deductions that the rule applies.
Although a single instance of the Apply Deductions Rule can be configured to apply several deductions, it is common to configure multiple instances of the rule, each applying only a subset of all the deductions the application makes while calculating net income from gross pay, so that deductions are applied in the correct order.
If there are any deductions configured to rely on other deductions in order to be calculated, these need to be applied in separate instances of the Apply Deductions Rule that are then placed in the correct order on the payroll policy. For example, if Deduction A is 50% of Deduction B, then the instance of the rule that calculates and applies Deduction B must be placed higher in the payroll policy's order of rules than the rule that applies Deduction A.
Ineligible deduction
Select the deductions that are excluded and not applied by the rule.
Leave blank and the rule does not explicitly exclude any deductions.
Maximum Arrears
Enter the maximum amount, in dollars, that the rule allows any deduction it applies to go into arrears by. Only relevant for deductions configured with the Allow Arrears checkbox selected during its configuration in Payroll Setup > Earnings and Deductions.