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Former Member
Apr 11, 2012 at 08:37 AM

Query on Salary Advance

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The following is the requirement regarding Salary Advance in my project:

Employees belonging to certain ESGs are eligible for Salary Advance, which is recoverable in 10 equal installments (without any interest). The employee is allowed to pre-close the advance amount by paying off the balance. The Salary Advance, that the employee is eligible for, is calculated as (BASIC + DA) x 2.

The employee is not eligible for a second Salary Advance unless he has cleared the first Salary Advance completely.

I have gone through the forum and realized that this can be handled through “Company Loans” and that the following configuration steps have to be followed:

Payroll – Payroll India – Company Loans –Master Data – Create a Loan Type

Payroll – Payroll India – Company Loans –Master Data – Assign Repayment type

Payroll – Payroll India – Company Loans –Master Data – Create Loan Conditions

Maintain Loan Eligibility Checks and Limits

Following are my queries:

1. Will the loan type be treated as a wage type, as it has to reflect in the payslip as a deduction item?

2. How to allow the pre-closure of the advance amount at any point of time?

3. How to post the amount to Accounting?

4. How to keep a check that employee cannot take a second Salary Advance when he is yet to clear the first Salary Advance?

Please help me out.