Calculation of 'BT' annual wage

For the wage processing of the new year, you calculate the 'BT' annual wage. If you do not, you cannot process the wages for period 1 of the new wage year.

If you calculate the ‘BT’ annual wages (special rate) in Profit, each employee will automatically be given a new salary line for the next year with the ‘BT’ annual wages. The ‘BT’ annual wages are required to determine the ‘BT’ percentage. If necessary, the employee is also provided with a new tax authority agency line.

Note:

If the employee already has a new salary line in the new wage year, the following applies:

  • If the future salary line (or contract line) falls on the start date of the wage year, Profit updates the ‘BT’ annual wage in the salary line.

    Example: The wage year starts on 1 January and you have added a new salary line for an employee on this date. Profit updates the 'BT' annual wage on the salary line.

  • If the future salary line falls in a future contract (within the same employment relationship), Profit does not update the ‘BT’ annual wage. In this situation, you calculate the 'BT' annual wage for these employees and enter it yourself.

    Example: The wage year starts on 1 January and you have added a new salary line for an employee on 1 May. Profit does not update the 'BT' annual wage.

You can only calculate the ‘BT’ annual wages when the following conditions are met:

  • The old wage year has been fully processed and approved.
  • The periods for the new wage year have been added to the salary processing plan.

Note:

You can only calculate the 'BT' annual wage for the new year once. You cannot restart this action for the same year once it has been executed.

For casual staff, Profit does not calculate the 'BT' annual wage, because Profit cannot estimate how many hours the casual employee will work based on the timetable. In this case, you estimate the 'BT' annual wage yourself. At the year-end transition, Profit copies the value of the previous year to the new year.

Contents

Setup values for ‘BT’ annual wage calculation

For the calculation of the ‘BT’ annual wage, Profit uses a number of default values that you configure per employer.

This way, you can have any extra percentage (for example, related to the year-end bonus) taken into account when calculating the ‘BT’ annual wage.

Setup values for ‘BT’ annual wage calculation:

  1. Go to: HR / Organisation / Employer.
  2. Open the employer’s properties.
  3. Go to the tab: Year-end work.

    You see a detailed description of the calculation.

  4. If applicable, change the percentages. In most cases, this is not necessary.

Calculation of the ‘BT’ annual wages wizard

For the wage processing in the new year you must calculate the ‘BT’ annual wages. If you fail to do this, you cannot pay any wages for period 1 of the new wage year.

Note:

If, as a new customer, you initiate the salary processing in Profit Payroll, then you will not have performed any salary processing in Profit for the previous year. As a result the ‘Loonheffing’ wage for the previous year is not known by Profit. Profit consequently is unable to calculate the ‘BT’ annual wages for the new wage year. In this case you calculate the ‘BT’ annual wages yourself, if necessary using the old salary processing software. Once you have calculated the ‘BT’ annual wages, you can import it by selecting HR / Management / Import employee change / Salary.

Calculating the ‘BT’ annual wages wizard:

  1. Go to:HR / Payroll / Year-end work / Calculation of 'BT' annual wages.
  2. Select the employer.
  3. Click on: Next.
  4. Select the period line.
  5. Click on: Next.
  6. Enter the values for the formulas. These are used in the following cases:

    If the employee was employed for the full year, then Profit copies the taxable wages of the previous year as the ‘BT’ annual wages. After running the wizard, Profit adds a new salary line for each employee. You can adjust the ‘BT’ annual wages in this new salary line, if necessary.

  7. Click on: Next.

    Profit starts up the calculation of the ‘BT’ annual wages. Once complete, Profit displays the results of the calculation. You can compare the calculated ‘BT’ annual wages with the Salary, the ‘Loonheffing’ wage and the old ‘BT’ annual wages. This way you can determine whether the formula is properly calculated. If necessary, you can also adjust a percentage or an amount.

  8. Click on: Finish.

The employee was employed for a part of the year

The employee received wages over a part of the previous year from the same employer. The ‘Loonheffing’ wage is first converted to an annual amount. The converted annual amount is used to retrieve the Special Rate percentage applicable to the new year from the Special Rate table.

Profit uses a formula to calculate the ‘BT’ annual wages for employees that only worked part of the previous year for the same employer and for employees that did not receive any wages throughout the previous year from the employer. The formula can be found by selecting HR / Organisation / Employer and then going to the Year-end work tab.

It is not possible to produce a good estimate for hourly paid employees without a timetable. This is why Profit copies the value from the salary line for the previous year.

Employee with multiple contracts

If an employee had multiple contracts in a year and was only employed for a part of that year, then Profit calculates the ‘BT’ annual wages on the basis of the last contract.

‘BT’ Annual Wages = ('Loon LH' in last contract / Calendar days in last contract) *365

Example:

Employee is employed:

  • from 8 June to 17 July inclusive.
  • from 7 September to 29 January in the new year. (116 calendar days, 'Loon LH' = 20,000.00)

    ‘BT’ Annual Wages = 20,000 / 116 * 365 = 62,931.03

The employee did not receive any wages

The employee’s period wage is first converted to an annual wage. The converted annual wage is used to retrieve the Special Rate percentage applicable to the new year from the Special Rate table.  The formula can be found in HR / Organisation / Employer under the Year-end work tab.

Comments on the formulas

  • Number of periods

    The number of periods is the number of periods for the period type of the employee: for period type Quarter it is 4; for period type Month it is 12; for Four Weeks it is 13 and for period type Week it is 52.

  • Number of hours

    The number of hours from the timetable is converted to a number of hours per year.

  • A% and D%

    These percentages are used for the holiday allowance. The default value is 8%, but you can deviate from this. This percentage is only used in the formula if for the tax authority agency, the Type of table field contains the value No 'vakantiebonnen' at the employee level.

  • B% and E%

    These percentages are set to 0% (zero) by default. If necessary, you can enter a percentage here if you want a certain percentage to be taken into account in the calculation of the ‘BT’ annual wages.

  • Amount C and Amount F

    These amounts are set to 0 (zero) by default. If necessary, you can enter an amount here if you want a certain amount to be taken into account in the calculation of the ‘BT’ annual wages.

Directly to

  1. Payroll year-end transition