The SAP System provides the following types of retirement payroll calculation: Retirement Allowance and Retirement Liquidation.

For the retirement liquidation for the current and next periods, the payments and deductions referent to unpaid portions of the monthly payment are calculated.

For the retirement allowance, income tax is calculated and the retirement payment effected.

This component includes the payroll functions for Retirement, which you must conduct when an employee retires from the company.

There are two kinds of business process in retirement which R/3 provides;

• Retirement Liquidation
• Retimerent Allowance

Retirement Liquidation for the next period includes Year End Adjustment function by default. You can deactivate this function by setting Infotype 0145.

Using Payroll Execution for Retiree Help Manager, you can

• Obtain an overview showing which process is completed and which is not, for each retiree.
• Decide which process to perform first, with regards to pay date sequentialization.
• Directly execute payroll functions for retirees proposed by the system.

Although you can proccess Retirement Liquidation and Retiement Allowance as independent business processes, you cannot run payroll functions whose pay date precedes the existing one. In other words, you have to perform payroll funcitons in order of pay dates.