Define Priority for Deductions (SAP Library

Define Priority for Deductions

In this step, you define deduction wage type characteristics for priorities and arrears processing.

You assign a priority to each deduction wage type. During payroll, the deductions are sorted according to their priority and processed in that order.

If the net amount is not sufficient for all the deductions, then a decision has to be made as to what happens to the deduction for each wage type:

All of the dedcuction is still deducted even if the net amount becomes negative. In this instance a claim is created.

The amount deducted does not exceed the net amount. In this instance, the remaining amount is transferred to the next period via the arrears table. The deduction is then processed as a regular deduction in this table.

A deduction is only deducted if the whole amount can be deducted. The deduction amount is also transferred in this instance.

1. A deduction for a voluntary supplementary insurance should have a higher priority than a deduction for a savings plan.

2. If the whole amount cannot be deducted for the savings plan, then the rest is transferred to the next period.

In the Arrears field, the deduction wage type must be assigned the value 2.

The standard system contains model wage types for deductions.

Reserve priority A for garnishment wage types.

So that payroll runs correctly, set the following values for the relevant deduction wage types:

Wage type priority

For example: A Priority is A (highest)

B Priority is B

C Priority is C

Arrears characteristic

For example: 1 Deduct whol amount

2 Deduct what is available

3 Transfer remaining amount to arrears table.