Payments & Deductions

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Once you have created at least one employee record, you can use the Pay & Deductions command on the Action menu associated with the Processing form to enter the payment and deduction details for each employee. You can define which payments and deductions are repeated for each pay period, unless overridden. So once you have set up each employee’s payments and deductions, you only need to make changes that are necessary on a period-by-period basis. The application automatically calculates pay on all payments and deductions you have chosen to repeat each period. You use the Add command on the Action menu on the Payments & Deductions form to set up the payments and deductions for the currently selected employee. Payments are set up on the Payments tab and deductions on the Deductions tab.

Employee pay records are not updated with the payments and deductions you define until you use the Calculation command.

Changes to salaried and weekly-paid employees can also be recorded in the Personnel application. Such changes update the salary or basic pay element numbers identified in the Salary Number and Basic Pay Number boxes on the Set Options form in the Personnel application.

Actions

When you click Action on the Payments & Deductions form, the following commands are available:

Use this command	To
Zero This Period	Clear the payment or deductions value for the current pay period. In certain circumstances, the application does this automatically during the payroll calculation procedure. For example, if you attempt to pay an employee holiday pay who has not sufficient holiday fund, no payment is made.
Add Item	Add a new payment or deduction to the employee record that does not exist on the employee profile.
Calculate	Display the results of calculating the pay for the employee this period.
Analysis	Assign nominal dimensions to the employee. This only applies if you have the Advanced Nominal Ledger or an external nominal ledger. Note that dimensions assigned on this form apply to all payments and deductions for the currently selected employee.

Pay and Deduction Entries

Payments

Box	Description
Perm. Value	A 'permanent' value to be repeated each pay period. Although described as 'permanent', you can change it at any time. You can override it for a given pay period by making an entry in the Temp. Value column or update it using the Pay/Ded Changes command on the Payroll - Global Changes menu. An example of a permanent payment is a salary.
Temp. Value	A temporary value you want to use for the current period only. You can use this to override the value in the Perm. Value box or for occasional payments, such as one-off expenses. The box can also be used to manually override calculated statutory payments (Statutory Sick Pay, Ordinary Statutory Paternity Pay or Additional Statutory Paternity Pay) or salary sacrifice payments. You can set up value-based salary sacrifice payments for employees who agree to give up some of their contractual cash pay in return for non-cash benefits. Value-based salary sacrifices can be set up either for a pension contribution or for other types of contribution, for example child care vouchers or the Cycle to Work scheme. When Advanced Pensions Processing is in use you can also set up percentage based salary sacrifice pension payments so that salary sacrifice payments are calculated automatically. This can be financially beneficial to both you the employer and also to the employee because of lower Income Tax and National Insurance contributions. If the employee's pay is subject to an attachment order you should contact HMRC to check whether their attachable pay is affected. This is not a deduction from pay but rather an agreement to give up part of cash pay in return for non-cash benefits. They are displayed as a negative payment (not a deduction) on both the Payments tab of the Payroll - Processing - Pay & Deductions form and on the employee's payslip. For details of salary sacrifice arrangements including how statutory payments and leave can be affected, please see www.hmrc.gov.uk/payerti/payroll/special-pay/salary-sacrifice.htm. For the steps to set up automatically calculated salary sacrifice payments in Opera 3, see the Setting Up Salary Sacrifice for Pensions and Setting Up Non-Pension Salary Sacrifice Help topics.
Units	The number of hours for the rate or, in the case of SSP / SMP units, the number of days. If payments are made on the basis of the number of hours worked, you can enter the number of hours each pay period. If the Retain Units option is selected on the Payment Profiles form for the payment concerned, the units are retained and displayed as a default in the subsequent periods. For example, you might want to retain a standard number of working hours for a basic pay element, while leaving overtime elements open without a default. Fractions of hours are treated as either minutes or decimals according to the selection in the Hours and Minutes option on the Options Page 2 tab of the Set Options form.
Rate	The rate per unit. This only applies if you have made an entry in the Units column. Pay is calculated by multiplying the units by the rate.
Description	The name of the payment profile.
T.P	The calculated value of the payment for this period.
T.D.L.P	The cumulative year to-date value up to the end of last period. You can change the value in this box, but this should only be done before you use the Calculation command or where you are creating a new payroll part way through the pay year.
T.D.T.P	The cumulative value of all payments for the profile for the pay year to-date, including the calculated value of the payment for this period.

Statutory Maternity Pay Payments

It may be necessary to supplement the amount of Statutory Maternity Pay calculated by the payroll software in specific circumstances. For example, if an employee qualifies for a pay rise at any time between the start of the period used to calculate SMP and the end of maternity leave, the amount of SMP paid needs to reflect that pay rise. If you are using full SMP processing within the payroll (that is, you have the Use Full SMP Processing option selected on the Options Page 2 tab of the Payroll Options form), you will need to set up a new payment profile. Refer to the SMP Adjustments section of the SMP Details topic.

If you are not using full SMP processing with the payroll, you can simply override the amount of SMP paid within any period.

Salary Sacrifice Payments

You can set up value-based salary sacrifice payments for employees who agree to give up some of their contractual cash pay in return for non-cash benefits. Value-based salary sacrifices can be set up either for a pension contribution or for other types of contribution, for example child care vouchers or the Cycle to Work scheme. When Advanced Pensions Processing is in use you can also set up percentage based salary sacrifice pension payments so that salary sacrifice payments are calculated automatically.

This can be financially beneficial to both you the employer and also to the employee because of lower Income Tax and National Insurance contributions. If the employee's pay is subject to an attachment order you should contact HMRC to check whether their attachable pay is affected.

This is not a deduction from pay but rather an agreement to give up part of cash pay in return for non-cash benefits. They are displayed as a negative payment (not a deduction) on both the Payments tab of the Payroll - Processing - Pay & Deductions form and on the employee's payslip.

For details of salary sacrifice arrangements including how statutory payments and leave can be affected, please see www.hmrc.gov.uk/payerti/payroll/special-pay/salary-sacrifice.htm.

For the steps to set up automatically calculated salary sacrifice payments in Opera 3, see the Setting Up Salary Sacrifice for Pensions and Setting Up Non-Pension Salary Sacrifice Help topics.

This feature is available in Opera 3.

Deductions

Note - forcing deductions to be taken before pension deductions: If you do not use Advanced Pension Processing, and need a particular deduction to be calculated before a pension deduction, that deduction's profile code must have a lower number on the Payroll - Maintenance - Deduction Profile form than the pension's profile code. For example, if an employer wants to contribute to a holiday fund after a deduction has been made for their pension, if the deduction profile's code for the pension is '003', the deduction profile's code for the holiday fund payment must be '001' or '002'. It cannot be '004' or higher.

This does not apply if you use Advanced Pension Processing, the application calculates the payments without needing the deduction profiles to be set up in this way.

Box	Description
%	Percentage deductions are applicable only to deduction types 'P', 'X', 'V' and 'H'. Add '%' to the % column to treat the permanent value as a percentage. For a description of these deduction types, see the Deduction Profile Help topic. If you are using the advanced pension processing facilities and the deduction type is P, X or V, you cannot amend this value here. Percentage deductions are always calculated on gross pay, even if the deduction profile's Deduct Before Tax or Deduct Before NI options are selected.
Perm. Value	A 'permanent' value to be repeated each pay period. Although described as 'permanent', you can change it at any time. You can override it for a given pay period by making an entry in the Temp. Value column or update it using the Pay/Ded Changes command on the Payroll - Global Changes menu. An example of use for a permanent deduction is a contribution to a union fund. If you are using the advanced pension processing facilities and the deduction type is P, X or V, you cannot amend this value here.
Temp. Value	A temporary value you want to use for the current period only. You can use this to override the value in the Perm. Value box or for occasional deductions, such as: The recovery of an invoice value which has been paid on the employee’s behalf. Pension contributions that are refunded if an employee opts out of a pension (see below).
Units	The number of hours for the rate. If deductions are made on the basis of the number of hours worked, you can enter the number of hours each pay period. If the Retain Units option is selected on the Deduction Profiles form for the deduction concerned, the units are retained and displayed as a default in the subsequent periods. Fractions of hours are treated as either minutes or decimals according to the selection in the Hours and Minutes option on the Options Page 2 tab of the Set Options form. If you are using the advanced pension processing facilities and the deduction type is P, X or V, you cannot amend this value here.
Rate	The rate per unit. This only applies if you have made an entry in the Units column. The deduction is calculated by multiplying the units by the rate. If you are using the advanced pension processing facilities and the deduction type is P, X or V, you cannot amend this value here.
Description	The name of the deduction profile.
T.P	The calculated value of the deduction for this period.
T.D.L.P	The cumulative year to-date value up to the end of last period. You can change the value in this box, but this should only be done before you use the Calculation command or where you are creating a new payroll part way through the pay year.
T.D.T.P	The cumulative value of all deductions for the profile for the pay year to-date, including the calculated value of the deduction for this period.

Pension Overrides

An override would be necessary if, for example, a refund was paid to someone who opts out of an auto enrolment pension after making one or more contributions. The exact override value entered is used, regardless of how the 'net of basic rate tax' option is set on the Payroll - Maintenance - Pension Scheme form for the pension scheme. This applies to both positive and negative values.

Net of basic rate tax

If the 'net of basic rate tax' option is selected on the pension scheme record, then a calculated pension contribution excludes basic rate tax relief. However, if an override value is entered in the Temp. column on the Pay & Deductions form to override a pension contribution Opera does not deduct basic rate tax from that value.

For example, if the basic tax rate is 20% and the total contribution to the pension must be £100.00 (4/5 of the total contribution is paid and 1/5 is claimed in tax relief from HMRC), the contribution will be calculated as described below but any override value you enter will not include tax relief.

Net of basic rate tax option	Automatically calculated contribution	Override contribution or refund entry
Ticked	The actual deduction will be £80.00 (4/5 of the total contribution). The remaining £20.00 (1/5 tax relief) will be claimed from HMRC by the pension scheme provider.	£80.00 or £-80.00 for a refund.
Not ticked	The actual deduction will be £100.00 (4/5 of the total contribution). In this situation £25.00 (1/5 tax relief) will be claimed by the pension provider.	£100.00 or £-100.00 for a refund.