An amount must print on the payslip but not be deducted

"The company pays its own share of the provident fund. The man should see it on his slip, so he knows what the company is putting in, but it must not come off his salary."

What is really being asked

He wants a figure that is visible and inert. Three different things could be meant and only one of them is this:

• An amount added to pay. That is an allowance.
• An amount taken off pay. That is a deduction.
• An amount shown and nothing else. That is an employer cost, and that is what he is asking for.

The whole behaviour sits in one field on Wage Type: Wage Type Direction. Nothing else needs changing, and nothing else will achieve it.

The three directions

There are three, and they ship like this:

Direction	What it does to the payslip	What it does to net pay	What it does to gross
D Debit	Prints as an addition	Increases it	Counts towards gross, if the indicator is Earning
C Credit	Prints as a deduction	Reduces it	Does not count
* (no name)	Prints	Nothing	Does not count

The third one is what you want. Note it honestly: that third entry has no name of its own, so in the Direction list it shows as a blank row below Debit and Credit. It is a maintained list with a Name field on the Wage Type screen, and that name has been left empty. Fill it in with something like Employer Cost before you train anybody, or every HR officer at this client will spend a year picking "the blank one". See value lists.

Only C Credit moves net pay. That is the single sentence to remember on this page.

What you need in place first

• Wage Type Group and Wage Type Category - a group and a category to file the new wage type under.
• A clear answer from the client on whether the amount is taxable in the man's hands. This matters more than it looks. See the warning below.

Do this

1. Open Wage Type and create a new one. Code PF-ER, Name "Provident Fund - Company Share".

2. Set Wage Type indicator to B Benefit. The four values are E Earning, B Benefit, T Tax and O Other. Benefit is right for a company cost: Earning would be wrong, because Earning plus Debit is what makes an amount part of gross pay.

3. Set Wage Type Direction to the third entry, the one with no name. This is the whole point of the exercise.

4. Leave Taxable unticked, unless the client's tax adviser has told you in writing that the company's contribution is taxable income for the employee. Read the warning below before you tick it.

5. Set Wage Type Unit and Pay Channel the same way as the other wage types at this client, and set Sort so the line prints where the client wants it on the slip.

6. Save. Then use the wage type wherever the amount comes from: on the Employer Share Wage Type of a Contribution Scheme, or on a line of Recurring Payments and Deductions if the client just wants a flat figure shown every month.

7. Run Payroll unposted and open a payslip.

The one that catches people: Taxable

Tick Taxable on a wage type with the third direction and the amount is added to the man's taxable income even though he never receives it. He pays tax on money the company kept.

Debit and the third direction both feed the tax base when Taxable is ticked. Credit never does. So:

• Employer cost, not taxable in his hands: third direction, Taxable off. This is the normal case.
• Employer cost that the tax authority treats as his income: third direction, Taxable on. Deliberate, rare, and get it in writing.

Where two clients differ

	Shows the company share	Does not show it
Employer Share Wage Type on the scheme	PF-ER, third direction	Left blank
What appears on the payslip	A "Company Share" line	Nothing
What the man's net pay is	Identical	Identical
Why	The client wants the man to see the total cost of employing him	The client does not want a conversation about it

Leaving the Employer Share Wage Type blank on a Contribution Scheme is a perfectly valid configuration. No line is written and net pay is unchanged, because the employer share never affected net pay in the first place.

How you prove it worked

1. Run Payroll unposted. Open one payslip and note gross, total deduction and net.
2. The new line must be visible. If it is not on the slip at all, the wage type is blocked, or the amount came out as zero, or no document carries it.
3. Note the net. Now compare it against the same man's net in the previous period, with nothing else changed. It must be identical to the rupee. If net moved, the direction is C Credit and you have just taken money off five hundred men.
4. Check gross has not moved either. If gross moved, the indicator is E Earning with direction D Debit, which is an allowance, not a cost.
5. Check the tax line has not moved. If it has, Taxable is ticked.

What will go wrong

• Credit is picked because "it is not an addition". Credit is a deduction. Net pay falls by the employer's own contribution and every man at the client notices in the same hour.
• The blank direction is thought to be a broken row and avoided. It is the one that does the job. Give it a name on the Wage Type screen so nobody has to guess again.
• Taxable is left at whatever the last wage type had. Copying an existing wage type carries the tick across, and the man is taxed on money he never got. Check it explicitly on every new wage type with this direction.
• The wage type is blocked later because somebody is tidying up. The line stops printing and net pay does not change, so nothing looks wrong until the client asks where his company-share line went.