Tax is worked out for the whole year from the slabs you enter for the fiscal year, less the reliefs and discounts that apply, and the tax still to pay is spread over the months left. Enter the slabs for a new fiscal year before its first pay run.
Penahak does not carry a tax table of its own. The slabs (the bands and their percentages) are entered by your company for each fiscal year, so they follow the law that applies to you. The pay run then works out the year's tax for each employee and charges a share each month.
How a month's tax is found
1
Project the year
Who
Penahak, in the pay run
What changes
The employee's taxable pay for the whole year is estimated: the months already paid, this month, and this month's amount for each month still to come.
2
Take off reliefs
What changes
Retirement savings (PF, SSF and CIT) up to a limit, insurance premiums up to a limit, the remote-area rebate, and discounts for impairment or for women where your company's rules give them.
3
Apply the slabs
What changes
The first slab is the social security tax (SST) slab; the others are income tax slabs. The tax of the year is found from the slab the taxable amount falls in.
4
Spread what is left
What changes
The tax of the year, less what was already charged this fiscal year, is divided by the months left. So a raise, a bonus or a new allowance changes the monthly tax from that month on.
An employee on SSF pays no SST in this calculation.
Enter the slabs
Open Payroll setup and the Tax rule tab. There is one block for Single and one for Married, for each fiscal year.
1
Add the rule
Who
Payroll officer or accountant
Where
Payroll setup › Tax rule › Add
What changes
Choose the Fiscal year and Tax rule for (Single or Married).
2
Add the rows
Where
Add row
What changes
For each slab enter Over amount, But not over amount and Tax percentage. The first row starts at 0 and is the SST row; there can be only one ("Only one SST is allowed"). Each next row starts where the last one ended; leave But not over amount empty on the last row.
3
Save
What changes
Penahak works out the tax of the lower slabs for you. The screen checks the rows and says which row is wrong ("Please check tax slab value of row").
An employee is put in the Married block when their marital status is married, or when their Tax rule for on Payroll details says so; otherwise they use Single. A rule that tax has already been charged against cannot be deleted.
The other tax tabs
Tab
What it holds
Tax discount rule
A discount for a Tax discount type (for example for women or for persons with impairment): a Factor (a fixed amount, or a percentage), the Value, and where it applies: In slab amount (lowers taxable income) or In tax amount (lowers the tax)
Remote tax rebate
A Rebate category with an Amount per month. A category is given to an employee by Penahak support: the employee's screen has no box for it
Per employee, under Other income and deduction:
Tab
What it holds
Medical tax discount
A medical bill and the Tax relief amount the employee may claim. It is given as a discount against the tax up to the yearly limit in Payroll configuration, and never more than the month's tax
