Supplementary Premium Calculation

Use

This function enables you to calculate the supplementary premium of national health insurance (NHI) contributed by the employee and the employer.

For the employee, the supplementary premium is calculated for the following income items:

  • Bonus with an accumulated amount per year that exceeds four times the insured monthly salary

  • Income from professional practice

  • Income from part-time jobs

For the employer, the supplementary premium is calculated for the difference between monthly salary and the NHI insured amount.

Prerequisites

You have defined the rates and the upper and lower limits related to the supplementary premium in Customizing for Payroll: Taiwan under Start of the navigation pathNational Health Insurance (NHI) Next navigation step Supplementary Premium Next navigation step Define Constants for Supplementary PremiumEnd of the navigation path. The system uses these constants in the calculation of the employee's and the employer's contributions to the supplementary premium.

If the employee joins the company in the middle of a year, then the bonus income that he or she received from the previous employer in the current year should also be included in the bonus income relevant for the supplementary premium. In such a case, you can manually enter the bonus amount from the previous employer with the User Input Cumulation (MUC1) wage type in the following infotypes:

  • Recurring Payments/Deductions (0014)

  • Additional Payments (0015)

  • Additional Off-Cycle Payments (0267)

Features

The calculation of the supplementary premium contributions is divided based on the contribution party and the corresponding income types:

Contribute By

Employee Type

Income Type

Employee

Regular employee

Bonus income with an accumulated amount per year that exceeds four times the insured monthly salary

Income from professional practices

Part-time employee

Income from part-time work

Employer

All employees

The employee’s regular income, including basic salary and bonus

Activities

When you run the payroll for an employee, the system proceeds as follows to calculate contribution amounts of the supplementary premium:

Supplementary Premium (by Employee) for Bonus Income

  1. Check if the employee is eligible for the supplementary premium for bonus income.

  2. If the employee is eligible, then accumulate the employee’s bonus by reading wage types of which the cumulation class is 30. If the employee joins the company in the middle of a year, include the manual input of bonus amount in the accumulated amount. See Prerequisites about when a manual input is necessary and how to enter the amount.

  3. Create the calculation base amount for the bonus in the following formula: bonus accumulated for a year – constant SNHMT x NHI insured amount.

  4. Calculate the supplementary premium for bonus with the formula: calculation base (see the previous step) x supplementary premium rate (constant SNHPT).

Supplementary Premium (by Employee) for Professional Practice Income

  1. Check if the employee is eligible for the supplementary premium for income from professional practices.

  2. If the employee is eligible, then accumulate the employee’s income from professional practices by reading wage types of which the cumulation class is 31. The system checks the amount of each wage type. Only those that exceed the minimum professional practice income (constant SNHMI) are accumulated.

  3. Check if the accumulated professional income exceeds the maximum professional income base (constant SNHMX) for supplementary premium.

  4. Calculate the supplementary premium for professional practice income with the formula: income from professional practice x supplementary premium rate (constant SNHPT).

Supplementary Premium (by Employee) for Part-time Income

  1. Check if the employee is eligible for the supplementary premium for income from part-time work.

  2. Accumulate the part-time employee’s income by reading wage types of which the cumulation class is 32.

  3. Calculate the supplementary premium for part-time income with the formula: accumulated part-time income x supplementary premium rate (constant SNHPT).

Supplementary Premium by Employer

  1. Accumulate the employee’s basic salary by reading wage types of which the specification value of Processing Class 71 is 1.

  2. Calculate the premium contribution using the following formula:

Payroll

Calculation Formula

Regular payroll

(Accumulated basic salary - NHI insured amount) x supplementary premium rate (constant SNHPT)

Off-cycle payroll

Accumulated basic salary x supplementary premium rate (constant SNHPT)

More Information

Supplementary Premium for National Health Insurance