/3C4 wage type

[Former Member]

Dear All,f

I have two reimbursements for Car:

1. Conveyance allowance as per standard laws, monthly exempted Rs. 1600

2. Car Hiring reimbursement on which driver and car perk is calculated, monthly exempted fully

Now I have maintained WTs for both, Conveyance- 1008 & Car hiring reimbursement- 1016. When I run PY:

The amount in WT /3C4 comes as 10000.

The eligibility of employee for Car hiring reimbursement is 1000/month.

Same amount is reflecting in /3C3

Total gross has increased by Rs. 10000- this is an error

[Former Member]

Closed. thanks

[Former Member]

guys please help..let me know if my scenario is not clear

waiting for help

Thanks,

Megha

[Former Member]

Hi Megha,

1. For conveyance wt no need of CC - 30, off that check mark and run the payroll.

2. If go with CLA/COA you wont get both conveyance & car perk, exemptions.

3. create a custom tax code and maintain with FUNCTION INCTX in the schema INN1.

Best Regards

[Former Member]

Hi Praneeth

1. For my Conveyance Wt 1008, I have to mark CC30 in order to show it in Form 16, how else system will give me this Wt as in standard form 16.

2. I quoted example of CLA/COA to give an idea of car hiring perk, though both are little different in a way that on Car Hiring the amount is paid(on exemption basis) to the employee and later in FI module it is debited from employees account. Whereas In CLA there is no amount which we need to pay to employee....its paid to third party always and hence no exemption on any payment for CLA. But in Car hiring I have to pay also that too exempted and over that car and driver perk should be created.

3. I have created custom tax code and assigned in INCTX.

Please help me in understanding CC 30, 32, 34, whats the difference and which is used when..would be helpful if you can give examples.

Secondly, If I go for Car hiring perk same as CLA/COA, wont system make perk value as negative....since when I am maintaining 581 and choosing CLA, putting Rent amount as "20000" and on defaulting WT in 0008 I am putting CLA wage type amount as "0" which in turn giving perk values as "-20000"....Can I do same in Car hiring also?

please suggest and help

Thanks,

Megha

[Former Member]

IT 0581 for HRA how come it came into Conveyance ? for car & conveyance use IT 0583.

if you are facing problem with car & driver salary exemption and perk, then use standard tax code to these and created custom tax code use to conveyance allow wage type with function INCTX.

[Former Member]

Hi Praneeth,

It was just an example since in every post I am trying to make clear my issue...I know It583 for car hiring. My issue is:

I have two reimbursements for Car:

1. Conveyance allowance as per standard laws, monthly exempted Rs. 1600

2. Car Hiring reimbursement on which driver and car perk is calculated, monthly exempted fully

Now I have maintained WTs for both, Conveyance- 1008 & Car hiring reimbursement- 1016. When I run PY:

The amount in WT /3C4 comes as 10000.

The eligibility of employee for Car hiring reimbursement is 1000/month.

Same amount is reflecting in /3C3

Total gross has increased by Rs. 10000- this is an error

I have already maintained Custom tax codes.

Please help me in understanding CC 30, 32, 34, whats the difference and which is used when..would be helpful if you can give examples.

Thanks,

Megha

[Former Member]

The same employee cannot be entitled to both. Either conveyance exemption will be applicable or Perquisite can be calculated. Could you explain the rationale behind maintaining both wage types?

[Former Member]

Hi Tania,

Thanks for responding..let me give you clear scenario:

1. I have two WTs 1008(conveyance allowance) & 1016(Car hiring reimbursement)

2. car perk is calculated on 1016 not on 1008.

3. Exemption on 1008 is Rs.1600(as per compliances) & exemption on 1016 is as per his eligibility which is Rs. 10000(so 10000 will be exempted every month)

4. I have maintained tax code for 1008 as SCNV and for 1016 as SCNE.

5. Cumulation class for 1008 is 1,12,28,30, 32 & for 1016 are 1,12,28, 32&34.

My issue are:

1. The value of Wt /3C4 is coming as 10000 in Py run...is it correct?

2. Please confirm the CC ..are they fine?

3. The total gross is increasing by 10000 which is error.

Please guide me with steps to correct this.

Thanks

Megha

[Former Member]

If 1016 is linked to tax code SCNE, then perquisite should be calculated and not exemption. I think you should go through the SAP help documentation so that your concepts about exemption & perquisites are clear.

[Former Member]

Hi Tania,

I have gone through every SAP doc...concept also I understood. But pls understand my client's reqt here. They provide both components....and if 1016 has car a ddriver perk value then it is also exempted at the same time...I dnt think it is not possible or a weird reqt which can not be mapped in SAP. It's just that I have facing issue with regard to /3C4 and total gross.

Anyone else pls any suggestion guys..

Waiting for help.

Thanks,

Megha

[Former Member]

Legally, as far as my knowledge goes,  if somebody is entitled to a car perk, he cannot get an exemption as well. Exemption is for those employees who do not have a car. I'd suggest you clarify this with your client as this requirement (perk +exemption to the same employee) seems to be inconsistent with IT laws.

[Former Member]

Hi Tania, you are absolutely right .

Can you help me out here with some solution. I confirmed it with client they want perk value and exemption both at same Wt 1016. Even, they agree that this is out of IT laws but then, in order to increase salary of employee they are giving this reimbursement fully exempted. I really have no idea now how to map this with standard settings.

Please help guys.

Thanks,

Megha

[Former Member]

Although technically this may be feasible, I'd definitely not recommend meeting this requirement. Am still unclear about the motive "to increase salary" - If they want it to be fully exempt, then why do they want to create a perquisite? Perk adds to taxable income so their very purpose would be defeated,

[Former Member]

Can you suggest how to do this, actually this case is similar of CLA/COA, in CLA/COA we maintain the rent amount and also the eligibility, but company pays to third party not to emloyee. But here, the company is paying to employee which is later getting debited from employee's salary from FI team.

But in PY I have to make sure that this payment is monthly exempted +perk value is also calculated on it.

Can you suggest a way out. How this should be feasible technically also, I have to hit the amount in RT anyway.

Thanks,

Megha

[Former Member]

anyone can provide some solution??

Thanks,

Megha