Note: While this example includes a US employee, the functionality described is also applicable for Canadian employees.
You create a quick entry on an off-cycle pay run using a custom check template called Secondary Check. Dayforce withholds $193.80 (approximately 13%) in federal taxes for the entry, as shown in the following example:
To configure Dayforce to withhold 25% in federal income tax on these earnings for the employee, you first need to ensure that the check template used for the payroll entry has flat tax enabled. Go to Payroll Setup > Check Templates, select the custom template Secondary Check, and select the Allow Flat Tax checkbox for the country of the employee, in this case the US. The Allow Flat Tax checkbox is shown in the following screenshot:
Next, go to People, open the employee profile, click Payroll > Tax Definitions, and go to the Flat Tax section, where you can create an override using the following settings:
- Check Template: Secondary Check
- Amount Type: Percent
- Effective From: Set the start date to include the date that the user created the off-cycle earning
- Federal Amount: 25
- State Amount: Blank
The following example shows these settings:
When you recalculate payroll, Dayforce withholds 25% in federal income tax and withholds the normal State/Provincial tax, based on compliance rules, as shown in the following example:
If you wanted to apply the override to the employee's regular scheduled pay instead of unscheduled pay, you would select Normal Checks (available only for US employees), which maps to the system Normal check template. The Normal check template allows flat tax for US employees by default, as shown in the following example.
Note: For Canadian employees, the Normal template isn’t an available option and isn’t selected when you select All Configured Checks.