To refund a pension that requires withholding tax, follow the steps below.
Set up refund deduction pay code
To set up a refund deduction pay code, follow these steps.
Click CorePay then click Reference.
Click Pay Codes.
🤓Tip: This pay code would not be subject to PAYE, PRSI, USC or PRD.
For the required refund, enter a negative value timesheet.
Under General, fill the following fields:
In the Description field, enter REFUND.
From the Taxable drop-down menu, select Non-Taxable.
From the Hours/Values/Days/Units drop-down menu, select Value.
From the Deduction/Allowance/BIK drop-down menu, select Deduction.
In the Maximum Value field, enter 999999.99.
From the PRSIable drop-down menu, select Non-PRSIable.
In the Multiplier field, enter -1.
In the Minimum Value field, enter -999999.99.
In the Analysis Code field, enter 7000 with a description VOLUNTARY DEDUCTIONS.
In the Payslip Description Override field, enter REFUNDSUPERANN.
In the Expense field, enter 35140.
To save changes, click save
icon.
Set up withholding tax deduction pay code
After you set up the refund deduction pay code, set up the withholding tax deduction pay code. To do this, follow these steps.
Click CorePay then click Reference.
Click Pay Codes.
🤓Tip: This pay code would not be subject to PAYE, PRSI, USC or PRD.
For the required withholding tax, enter a positive value timesheet.
📌Note: The withholding tax value is calculated outside of CorePay.
Under General, fill the following fields:
In the Description field, enter PENSION WITHHOLDING TAX.
From the Taxable drop-down menu, select Non-Taxable.
From the Hours/Values/Days/Units drop-down menu, select Value.
From the Deduction/Allowance/BIK drop-down menu, select Deduction.
In the Maximum Value field, enter 999999.99.
From the PRSIable drop-down menu, select Non-PRSIable.
In the Multiplier field, enter -1.
In the Minimum Value field, enter -999999.99.
In the Analysis Code field, enter 6000 with a description STATUTORY DEDUCTIONS.
In the Payslip Description Override field, enter REFUNDSUPERANN.
In the Expense field, enter 35130.
To save changes, click save
icon.
The CorePay process for refunds is:
Refund 100% of contributions using the refund pay code.
Deduct 20% withholding tax using the withholding tax pay code.