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SAP US Payroll Schema changes - Tax offset for a wage type

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Hello Friends,

Requirement is as below:

Stock option is given to employees and is run as offcycle. it221 and a subtype 'ZZZZ' is used to enter stock.

Wage type '1xxx' is used to enter stock units given to employees. Since it is not a cash, it is offset using another salary adjustment deduction wage type - '2xxx' which makes the net pay zero.

Then offcycle is run to calculate tax that will be calculated on this stock option. Net pay at this point will be a negative tax amount. Once we know the amount of tax, then an entry is made in IT221 to add another wage type to offset the tax with a negative sign '3xxx'.

Again offcycle is run for the employee which will generate a zero net pay.

We would like to completely eliminate the second step in this process and schema should be able to generate an offset for this Infotype, subtype for this wage type for tax amount generated.

Please assist. Any help will be greatly appreciated. Please let me know if more details are required.

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Answers (3)

Answers (3)

former_member353481
Participant
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If I understand this correctly, the purpose of the 2nd step in your process is to figure out the amount of tax that would have to be paid on the gross so you are running a payroll simulation, look up the tax amount and then you use this tax amount on another wage type as an offset to make net pay $0? In SAP, it's not easy to work backwards, you'll have to do everything BSI is doing and there might be rounding issues.

The only way this can be done is if your off-cycle is a 'B' run and there is only 1 pay component (only 1 Wage Type) on the offcycle (nothing other than Stock in your case). Then after USTAX function, you can figure out the tax on the pay component and then reverse it so that net pay will be zero.

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nandredd jignya.joshi please assist

nanda-kishore
Explorer
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What is the second step here?

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Meaning? Could you please elaborate what exactly are you looking at?

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rmi.corriveau Could you please guide me?

former_member193210
Active Contributor
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Hello Meenakshi,

I have no experience with Payroll USA, nor have I experience with "Stock Units" so do not expect lots from me, but if I had a similar situation (Payroll Canada), I would use a WT similar to "Taxable Benefit", or a WT that adds to Taxable Earnings (/102) without generating a payment.

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Thanks Remi.