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How to make relocation charges as tax free

Hi Everyone

As per our management, in SAP HR, relocation charges to be exempted from tax. Please guide me to do so.

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  • author's profile photo Former Member
    Former Member
    Posted on Sep 13, 2016 at 11:42 AM

    Hi Tarun,

    The wage types for which the Cumulation class 24 is ticked is a regular component and will be projected and where as the wage types for which the Cumulation class 25 is ticked is an irregular component and is not projected as per YTD basis.

    This you cna check through transaction SM30 - V_512W_D. Check for your custom wage types. Based on that you can analyse which all components are taxable and non-taxable.

    Regards,

    Bhagyashree

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  • Posted on Sep 14, 2016 at 11:52 AM

    Check processing class 71 for such cases /124, /125 both pare part of tax calculation there will be no change.

    Regards

    Venkatesh

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