Disclaimer: The content of this article pertains to the altHR payroll module (not PayrollPanda). As of this date, the altHR payroll module has been discontinued as we form a new partnership with PayrollPanda to bring forth enhanced payroll solutions for our users.
What are Pay Items?
Pay items are the components that make up your employee’s monthly salary.
What is the Pay Item's Category available in altHR?
|Category||Example of Pay Items|
|1||Normal (Remuneration)||Allowances (such as Attendance/Meal/Travelling), Benefits-in-Kind (BIK), VOLA|
|2||Additional (Remuneration)||Ad-hoc and non-regular pay items such as Bonus, Commissions, Directors fees, Incentives|
|3||Overtime (Pay)||Normal overtime, overtime on the rest day, and public holiday|
**Please take note this is still a manual calculation, admin to input Total Overtime Pay in Run Payroll page
|4||Deduction||CP38, Unpaid leave, Zakat|
**Please use system's preset Zakat pay item for zakat as system only recognise system's preset Zakat to rebate directly from employee's PCB
How to Add/Create New Pay Items?
To add new pay items:
1. On the left panel of your admin dashboard, head to Payroll > Settings.
2. Click on the Set Pay Items tab.
3. At here, decide you are creating the pay item under Normal/Additional/Overtime/Deduction > Scroll to the bottom & Click Add Pay Item
4. Enter details of the new pay item such as name, wage type, and EA field > Confirm to save
5. Tick the entitled statutory deductions (EPF/SOCSO/EIS/PCB/HRDF)
How to set Non-taxable & Taxable Pay Items?
Generally, there are 3 conditions on Non-taxable & Taxable pay items:
|No.||Tax conditions of Pay Item||Examples|
* Pay item that the full amount is not eligible for tax
**For claim, it is reimbursement of expenses hence it shall not consider as part of gross remuneration, hence, no need to include it in EA form, only need to include in payslip
|2||Fully Tax Exempted|
*Pay Items that the full amount is fully-exempted from tax
|Benefits/Allowance/Perquisites that are allowed by LHDN to be fully exempted from tax - Such as, Parking allowance, Mobile Allowance, etc|
|3||Taxable with Tax Exemption Limit|
*Pay items that a certain amount is exempted from tax, if exceeded the amount is, the excessed amount will consider gross remuneration and subject to tax
|Travelling Allowance, Childcare Allowance, Leave Passage, etc|
- Do not have to select the EA field
- Turn OFF the "Is this Tax Exempted?"
- No need to tick "PCB"
- Fully-tax exempted
- NOTES: For a fully-tax-exempted pay item, it is mean the pay item is supposed to be taxable but LHDN listed it to be fully exempted, these are such as Mobile Phone Bill, Phone, Internet, Parking allowance & Meal allowance). Refer to LHDN's Nota Penerangan Bahagian F
-If you're not sure about which EA field, please refer to Understanding the EA fields
- Please tick "PCB"
- Taxable with Tax Exemption Limit
- Please select EA field according to its pay nature (This field MUST be F) > Tax exempted is ON > toggle ON the limit > Key in the exempted amount, and the EA field if it is NOT excess of the limit (This field MUST be B)
- Refer to Understanding the EA fields
- Please tick "PCB"
- You are encouraged to set the pay items settings such as EA field or statutory deduction after consulting the payroll expert/tax expert or the authorities (KWSP/PERKSO/LHDN/HRDF).
- Please only use the PRESET pay items by altHR if it fits your needs! As the preset pay items may differ.
- Kindly speak to our Payroll Support at firstname.lastname@example.org to understand if your pay item would fit the PRESET PAY ITEMS.
Read more about:
- Full video on "How to Configure Payroll Settings":