Add a loan with conditional repayment

You add a loan that the employee only needs to repay under certain conditions. This could be the case, for example for a study cost arrangement. In this case the employer reimburses the costs of a certain course, but if the employee leaves employment during or shortly after completing the studies, the loan will have to be repaid.

To add a loan with conditional repayment:

1. Go to: HR / Employee / Employee.
2. Open the properties of the employee.
3. Go to the tab: Loan.
4. Click on: New. 
5. Enter the loan amount in Principal sum.
6. Select Loan with provisional repayment for Type loan.
7. Enter the date of payment.
8. Do not select the Pay pricipal sum in wage processing check box.

   If you select the Pay pricipal sum in wage processing check box, Profit will pay out the principal sum in the period in which the date falls. It could be, for example, that you simply pay the invoice of a training institute and that you do not pay out any money to the employee.

9. Select Repayment through deduction for Type of repayment.
10. Deselect the Generate repayment schedule check box.

    You do not add a repayment schedule until the employee needs to pay back the loan, but with a view to the conditional nature of the loan, this is not likely.

11. Click on: Next.
12. Select Apply interest based on market-level interest for Interest.

    If an employer uses the 'werkkostenregeling' ('WKR'), you cannot apply the statutory interest rate to a loan. In that case, use the market-level interest rate.

13. Enter the interest rate percentage.

    This percentage is the annual percentage and Profit converts this to a percentage per period on a pro rata basis.

14. Select the method for determining the outstanding balance in Interest calculation.
    • Periodic based on outstanding balance per start date current period

      Profit calculates the interest on the outstanding balance on the start date of the period, thus excluding the repayment in the current period.

    • Periodic based on outstanding balance per end date current period

      Profit calculates the interest on the outstanding balance on the end date of the period, thus including the repayment in the current period.

15. Select the calculation method for the interest advantage.

    If you apply 'WKR' for this employer, you can include the interest advantage as 'eindheffing' (final levy) in the free room. You can read how to apply this in the 'Handboek Loonheffingen'.

16. Click on: Next.
17. Don't forget to enter the descriptions for the pay slip.

    If you do not enter the descriptions, Profit will use the wage component descriptions.

18. Click on: Finish. 

    If you have specified in the properties of theType loan that you want to add a dossier item, Profit will immediately launch the New dossier item wizard. Now you can generate a loan agreement and save it in the employee's dossier.