India Payroll Setup Document PDF

Oracle E-Business Suite HCM
India Payroll - Setup Document
Mar 2014
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ORACLE E-BUSINESS SUITE HCM ....................................................................................................................... 1
INDIA PAYROLL - SETUP DOCUMENT ................................................................................................................ 1
1. BUSINESS GROUP SETUP .................................................................................................................................................. 5
CREATING BUSINESS GROUP .......................................................................................................................................................... 5
CLASSIFYING A BUSINESS GROUP..................................................................................................................................................... 6
ENTERING ADDITIONAL INFORMATION ............................................................................................................................................. 6
CLASSIFYING A BUSINESS GROUP AS HR ORGANIZATION...................................................................................................................... 7
CLASSIFYING A BUSINESS GROUP AS GRE / LEGAL ENTITY.................................................................................................................... 8
2. ACCESS TO BUSINESS GROUP ......................................................................................................................................... 10
GRANTING ACCESS FOR BUSINESS GROUP....................................................................................................................................... 10
CREATING A RESPONSIBILITY ......................................................................................................................................................... 10
ASSIGNING RESPONSIBILITY TO USER .............................................................................................................................................. 11
CHANGING SYSTEM PROFILE VALUES ............................................................................................................................................. 11
CORE HR SETUPS ....................................................................................................................................................................... 12
3. PAYROLL SETUPS ........................................................................................................................................................... 13
DEFINE PAYMENT METHOD ......................................................................................................................................................... 13
DEFINE CONSOLIDATION SET ........................................................................................................................................................ 15
DEFINE PAYROLL ........................................................................................................................................................................ 15
DEFINE BASIC SALARY ELEMENT.................................................................................................................................................... 16
DEFINE ELEMENT LINK ................................................................................................................................................................ 18
DEFINE FAST FORMULA & FAST FORMULA RESULTS ......................................................................................................................... 19
DEFINE SALARY BASIS ................................................................................................................................................................. 20
4. CREATE EMPLOYEE ........................................................................................................................................................ 22
5. MANDATORY ELEMENT LINKS ....................................................................................................................................... 24
DEFINE SEEDED ELEMENT LINKS.................................................................................................................................................... 24
6. PROFESSIONAL TAX SETUP ............................................................................................................................................ 25
PROFESSIONAL TAX ORGANIZATION SETUP ..................................................................................................................................... 25
PROFESSIONAL TAX ELEMENT LINK SETUP ....................................................................................................................................... 28
PROFESSIONAL TAX SETUP AND TESTING ........................................................................................................................................ 29
7. ESI (EMPLOYEE STATE INSURANCE) ............................................................................................................................... 31
ESI TAX ORGANIZATION SETUP..................................................................................................................................................... 31
ESI TAX ELEMENT LINK SETUP ...................................................................................................................................................... 33
ESI SETUP TO EMPLOYEE AND TESTING........................................................................................................................................... 33
8. PF (PROVIDENT FUND) ................................................................................................................................................... 35
PF ORGANIZATION SETUP............................................................................................................................................................ 35
PF ELEMENT LINK SETUP ............................................................................................................................................................. 37
PF SETUP TO EMPLOYEE AND TESTING ........................................................................................................................................... 38
9. MEDICAL REIMBURSEMENTS ......................................................................................................................................... 41
MEDICAL REIMBURSEMENT ELEMENT AND ELEMENT LINK SETUP ........................................................................................................ 41
MEDICAL REIMBURSEMENT ORGANIZATION SETUP........................................................................................................................... 43
MEDICAL REIMBURSEMENT SETUP AND TESTING (LOGIN AS EMPLOYEE) ............................................................................................... 45
10. HOUSE RENT ALLOWANCE ........................................................................................................................................... 48
HOUSE RENT ALLOWANCE ELEMENT AND ELEMENT LINK SETUP ......................................................................................................... 48
FORMULA RESULTS..................................................................................................................................................................... 51
HRA SETUP TO EMPLOYEE AND TESTING ........................................................................................................................................ 51
11. LABOUR WELFARE FUND ............................................................................................................................................. 54
LWF ORGANIZATION SETUP ........................................................................................................................................................ 54
DEFINING FREQUENCY OF CONTRIBUTION........................................................................................................................................ 55
LWF ELEMENT LINK SETUP ......................................................................................................................................................... 57
LWF SETUP TO EMPLOYEE AND TESTING ........................................................................................................................................ 58
12. LEAVE TRAVEL ALLOWANCE (LTA) ................................................................................................................................ 60
LEAVE TRAVEL CONCESSION ELEMENT AND ELEMENT LINK SETUP ....................................................................................................... 60
RECORD LTC ELEMENT AT BG LEVEL ............................................................................................................................................. 62
LEAVE TRAVEL CONCESSION BILL DECLARATION AND TESTING ............................................................................................................ 64
13. BONUS ......................................................................................................................................................................... 69
BONUS ELEMENT SETUP .............................................................................................................................................................. 69
BONUS ELEMENT LINK SETUP ....................................................................................................................................................... 73
BONUS TESTING FOR AN EMPLOYEE ............................................................................................................................................... 74
14. CONVEYANCE ALLOWANCE .......................................................................................................................................... 76
CONVEYANCE ALLOWANCE ELEMENT AND LINK SETUP ...................................................................................................................... 76
CONVEYANCE ALLOWANCE TESTING .............................................................................................................................................. 78
15. SETTING UP PERQUISITES ............................................................................................................................................ 80
PERQUISITES ELEMENT AND LINK SETUP ......................................................................................................................................... 80
COMPANY ACCOMMODATION ...................................................................................................................................................... 80
FORMULA RESULTS..................................................................................................................................................................... 83
PERQUISITE SETUP TO EMPLOYEE AND TESTING................................................................................................................................ 84
16. STATEMENT OF EARNINGS BREAKUP (SOE BREAKUP).................................................................................................. 86
COMPONENTS OF SOE................................................................................................................................................................ 86
DETAILS ABOUT THE SOE COMPONENTS ......................................................................................................................................... 87
BALANCES ................................................................................................................................................................................ 90
PAYMENT DETAILS ..................................................................................................................................................................... 92
17. RETRO PAY FOR INDIA PAYROLL .................................................................................................................................. 93
RETROPAY – INTRO & BASIC SETUP ............................................................................................................................................... 93
RETROPAY FOR INDIA PAYROLL ..................................................................................................................................................... 96
HOUSE RENT ALLOWANCE ........................................................................................................................................................... 97
RETRO FOR PT/PF/ESI ............................................................................................................................................................... 97
RETRO FOR SECTION 89 RELIEF CALCULATION ................................................................................................................................. 98
18. FLOW CHARTS .............................................................................................................................................................. 99
TAX PROCESS FLOW ................................................................................................................................................................... 99
INDIA PAYROLL PROCESS OVERVIEW ............................................................................................................................................ 100
1. Business Group Setup
Creating Business Group
1. Log in the instance.
2. Navigate to Organization window
N>Global HRMS Manager > Work Structures > Organization > Description
3. Enter XX Business Group {here XX stands for your initials} in the Name field.
4. Select Business Group in the “Type” field.
5. Change from date to 01-Jan-2000.
6. Select Hyderabad in the location field.
7. Select Internal to indicate that this organization is within your enterprise.
8. Save your work.
Figure 1 - 1
Classifying a Business Group
10. Query IN Business Group (Documentation)
11. Enter Business Group in the blank row under Name field in Organization Classification block.
12. Ensure that Enable is checked.
13. Save your work.
Entering Additional Information
14. Click on the Others <Button>.
15. Select Business Group Info and then click on the Ok button.
16. Click in the blank row under Business Group Info. One pop up window will open.
17. Fill in the following information.
a. Short Name: IN_BG
b. Employee Number Generation: Automatic
c. Applicant Number Generation: Automatic
d. Contingent Worker Number Generation: Automatic
e. Grade Flexfield Structure: Vision India Grade Flexfield
f. Group Flexfield Structure: Vision India People Group Flexfield
g. Job Flexfield Structure: Vision India Job Flexfield
h. Costing Flexfield Structure: Vision India Cost Allocation Flexfield
i. Position Flexfield Structure: Vision India Position Flexfield
j. Competence Flexfield Structure: Vision India Competence Flexfield
k. Legislation Code: India
l. Currency: INR
m. Fiscal Year Start: 01-Apr-2000
n. Minimum Working Age: 18
o. Maximum Working Age: 60
18. Click on the OK button.
19. Save your work.
20. Return to Organization window.

Figure 1 - 2
Classifying a Business Group as HR Organization
23. Select HR Organization in the blank row under Name field in Organization Classification block.
25. Save your work.
26. Select Income Tax Office in the blank row under Name field in Organization Classification block.
28. Save your work.
(This Income Tax Office is mandatory to get Income Tax Office Column Populated in Income Tax Information in GRE/Legal
Entity.) Entering Income Tax Information is mandatory to get GRE/Legal Entity in Statutory Tab in Assignment Form of the
employee.
Classifying a Business Group as GRE / Legal Entity
31. Select GRE / Legal Entity in the blank row under Name field in Organization Classification block.
The following setup is mandatory for IN Legislation
Figure 1 - 3
33. Save your work.
The following Organization Classifications are present in Indian legislation.
34. Select Registered Company in the blank row under Name field in Organization Classification block.
36. Save your work.
37. Select Factory in the blank row under Name field in Organization Classification block.
39. Save your work.
40. Select Shops / Establishment in the blank row under Name field in Organization Classification block.

42. Save your work.
43. Select Contractor in the blank row under Name field in Organization Classification block.
45. Save your work.
46. Select ESI Organization in the blank row under Name field in Organization Classification block.
48. Save your work.
49. Select Provident Fund Organization in the blank row under Name field in Organization Classification block.
51. Save your work.
(System might force users to enter further information on Provident Fund; you can ignore this as of now. This will
be covered in Provident Fund Setup: Chapter 8)
52. Select Professional Tax Organization in the blank row under Name field in Organization Classification block.
54. Save your work.
(System might force users to enter further information on Professional Tax; you can ignore this as of now. This
will be covered in Professional Tax Setup: Chapter 6)
Figure 1 - 4
2. Access to Business Group
Granting Access for Business Group
Creating a responsibility
1. Navigate to responsibility window.
N>System Administrator > Security > Responsibility > Define

2. Enter following information.
a. Responsibility Name: IN HRMS Manager
b. Application: Human Resources
c. Responsibility Key: IN_HRMS_MANAGER
d. Description: IN HRMS Manager for Business Group
e. From: 01-JAN-2000
f. Available From: Oracle Applications
g. Data Group
i. Name: Standard
ii. Application: Human Resources
h. Menu: India HRMS Navigator
i. Request Group: IN HRMS Reports and Processes
j. Save your work.

Figure 2 - 1
Assigning responsibility to User
3. Navigate to User window.
N> System Administrator > Security > User > Define

4. Query for INBOOTCAMP (your username may be different)
5. Click in the blank row under the Responsibility field.
6. Select IN HRMS Manager
7. Enter 01-JAN-2000 in from field.
8. Save your work.
Changing System Profile Values
9. Navigate to Profile window.
N> System Administrator > Profile > System

10. Ensure that Responsibility check box is checked.
11. Enter IN HRMS Manager, in the Responsibility field.

12. In the profile box, select HR: Security Profile and HR: Business Group
13. Click on find.
14. Enter IN Business Group (Documentation) under the name of your responsibility.
15. Save your work.
16. Click on View > Find.
17. Similarly, enter value for the following profile option using your responsibility as the context.
HR:User Type: HR with Payroll User
18. Save your work.

Core HR Setups
1. Define Locations
Navigate to location window.
N>IN HRMS Manager > Work Structures > Location
2. Define Organizations
Navigate to Organization window.
N>IN HRMS Manager > Work Structures > Organization > Description
Select HR Organization in the Organization Classification field.
3. Define Grades
Navigate to Grade window.
N>IN HRMS Manager > Work Structures > Grade > Description
4. Define Jobs
Navigate to Jobs window.
N>IN HRMS Manager > Work Structures > Job > Description
5. Define Positions
Navigate to Positions window.
N>IN HRMS Manager > Work Structures > Position > Description
3. Payroll Setups
Define Payment Method
1. Navigate to Payment Methods window.

N> IN HRMS Manager > Payroll > Payment Methods
2. Create a payment method with following details: (Cheque and Direct Deposit)
a. Name IN Cheque (Custom)
b. Type Cheque (India)
c. Currency INR (Appears by Default)
d. Source Bank (Tab)
i. Account Type Savings
ii. Account Number 000123456789
iii. Bank Name ICICI Bank
iv. Branch Name Hyderabad
3. Save your work
Figure 3 - 1
Direct Deposit for India is not available. So we need to create Payment Types first
N> IN HRMS Manager > Payroll > Payment Types
Figure 3 - 2
a. Name IN Direct Deposit (Custom)
b. Type Direct Deposit (India)
c. Currency INR (Appears by Default)
d. Source Bank Tab
i. Account Type Current
ii. Account Number 000123456789
iii. Bank Name ICICI Bank
iv. Branch Name Hyderabad
Save your work.

Figure 3 - 3
Define Consolidation Set
1. Navigate to Consolidation window.
N>IN HRMS Manager > Payroll > Consolidation
Figure 3 – 4
Define Payroll
1. Navigate to Payroll window.

N>IN HRMS Manager > Payroll > Description
a. Name IN Monthly Payroll
b. Period Type Calendar Month
c. First Period End Date 31-Jan-2000

d. Number of Years 25
e. Default Payment Method IN Cheque (Custom)
f. Consolidation Set IN Monthly Consolidation Set (Custom)
Figure 3 – 5
Define Basic Salary Element
(IN Legislation Elements has been to be created from EDW)
N > IN HRMS Manager > Total Compensation> Basic > Element Design Wizard > Create Button
a. Name IN Basic Salary
b. Reporting Name IN Basic Salary
c. Description IN Basic Salary
d. Primary Classification Earnings
e. Input Currency INR
f. Effective Start Date 01-Jan-2000
g. Should employees automatically receive this element (Standard Link) ? NO
h. At which point in the termination process are employees no longer eligible for this element? Actual
Termination Date
i. Click on Next Button
j. Calculation Rule Earnings
k. Should this element automatically recur or should it be entered explicitly for each payroll period in which
you want to process it? Recurring
l. Process once per payroll period? Yes
m. How is this element processed per pay period? Element is processed and paid with other earnings.
n. Is more than one entry of this element allowed for an employee in a pay period? No
o. Used for determining ESI Eligibility Yes
p. Contributes to ESI Computation Base Salary Yes
q. Contributes to PF Computation Base Salary Yes
r. Contributes to PT Computation Base Salary Yes
s. Contributes to HRA and Related Exemptions Base Salary Yes
t. Contributes to Company Accommodation Base Salary Yes
u. Contributes to Notice Pay Base Salary Yes
v. Contributes to Leave Encashment Base Salary Yes
w. Used for determining Gratuity Eligibility Yes
x. Used for Pension Contribution Yes
y. Used for Pension Exemption Yes
Click on Submit
Figure 3 – 6
Define Element Link
1. Navigate to Element Link window.
N>IN HRMS Manager > Total Compensation > Basic > Link
Figure 3 – 7
Define Fast Formula & Fast Formula Results
1. Navigate to Fast Formula window.
N>IN HRMS Manager > Total Compensation > Basic > Write Formula
a. Name : IN_BASIC_SAL_CUSTOM
b. Type : Oracle Payroll
c. Code
/*================= Database Items Defaults Begins ================*/
DEFAULT FOR PAY_PROC_PERIOD_START_DATE IS '01-JAN-1909' (DATE)
DEFAULT FOR PAY_PROC_PERIOD_END_DATE IS '31-DEC-4712' (DATE)
DEFAULT FOR EMP_TERM_DATE IS '31-DEC-4712' (DATE)
DEFAULT FOR EMP_HIRE_DATE IS '01-JAN-1950' (date)
/*================= Database Items Defaults Ends =================*/
/*============ Defaults for Variables Begins =====================*/

DEFAULT FOR STANDARD_VALUE IS 0
DEFAULT FOR Prorate_Start IS '01-JAN-1909' (Date)
DEFAULT FOR Prorate_End IS '31-DEC-4712' (Date)
/*============ Defaults for Variables Ends =======================*/
INPUTS ARE STANDARD_VALUE

,Prorate_Start(DATE)
,Prorate_End(DATE)
L_Start_Date = GREATEST(PAY_PROC_PERIOD_START_DATE,Prorate_Start,EMP_HIRE_DATE)
L_End_Date = LEAST(PAY_PROC_PERIOD_END_DATE,Prorate_End,EMP_TERM_DATE)
L_Total_Days_In_Week = DAYS_BETWEEN(PAY_PROC_PERIOD_END_DATE,PAY_PROC_PERIOD_START_DATE) + 1
L_Proration_Days = DAYS_BETWEEN(L_End_Date,L_Start_Date) + 1
L_Amount = STANDARD_VALUE * (L_Proration_Days / L_Total_Days_In_Week)
RETURN L_Amount
d. Save your Work
2. Navigate to Formula Results window.
N> IN HRMS Manager > Total Compensation > Basic > Formula Results
a. Name IN Basic Salary
b. Click Find
c. Formula IN_BASIC_SAL_CUSTOM
d. Name (Formula Results) : L_AMOUNT
e. Type (Formula Results) : Direct result.
f. Input Value : Pay Value
g. Units : Money
h. Save your work
Figure 3 – 8
Define Salary Basis
1. Navigate to Organization window.

N>IN HRMS Manager > Total Compensation > Basic > Salary Basis
a. Name IN Monthly Salary
b. Basis Monthly Salary
c. Element Name IN Basic Salary
d. Pay Annualization Factor 12
e. Input value name Standard Value
2. Save
Figure 3 – 9
4. Create Employee
Navigate to People Form
N>IN HRMS Manager > People > Enter and Maintain >
Enter Basic Information and Salary Details and Click on save
Employee Name Employee Number
Test 1, Manager 1 1 (Manager for all Employees)
Test 2, Employee 2 2
Test3, Employee 3 3
Test4, Employee 4 4
Figure 4 – 1
Figure 4 – 2
5. Mandatory Element Links
Define Seeded Element Links
Navigate to Element Link window.
N>IN HRMS Manager > Total Compensation > Basic > Link
Date Track to 01-Apr-2005, In India Legislation most of the seeded elements are created from 2005,
You may enable the links from the effective date on which the element is created. (Please verify carefully)
1. Income Tax Information (Check the Standard Check Box)
2. Deduction Information (Check the Standard Check Box)
3. Income Information (Check the Standard Check Box)
4. Income Tax
5. Deduction under Section 80CCE
6. Deduction under Section 80CCF
7. Deduction under Section 80CCG
8. Deduction under Section 80D
9. Deduction under Section 80DD

10. Deduction under Section 80DDB
11. Deduction under Section 80E
12. Deduction under Section 80G
13. Deduction under Section 80GG
14. Deduction under Section 80GGA
15. Deduction under Section 80TTA
16. Deduction under Section 80U
17. Deductions under Chapter VI A
18. Deferred Annuity

6. Professional Tax Setup
There are three setup steps
1. Professional Tax Organization Setup
a. Professional Tax Info
b. PT Challan Info
c. Representative Details
d. PT Frequencies
2. Professional Tax Element Link Setup
a. Professional Tax Information
3. Professional Tax Setup and Testing
Professional Tax Organization Setup
1. Log in to Application
N> Global HRMS Manager > Work Structures > Organization > Description
a. Name : IN Professional Tax Organization
b. Date : 01-JAN-2005
c. Location : Hyderabad
d. Internal or External : Internal
e. Add Classification : Professional Tax Organization

Figure 6 – 1
f. Click on Others Button and Select Professional Tax Info
i. State : Andhra Pradesh
ii. Registration Number : 12345678
iii. Registered Name : IN Business Group (Documentation)
Figure 6 – 2
iv. Click on OK, Save and close the window.

g. Click on Other Button and Select PT Challan Info
Figure 6 – 3
h. Click on OK, Save and close the Window
i. Click on Other Button and Select Representative Details.
Figure 6 – 4
j. Click on OK, Save and close the Window
1. Query for Organization IN Business Group (Documentation)
2. Select the Classification Business Group
3. Click on Others Button and Select PT Frequencies

Figure 6 – 5
a. State : Andhra Pradesh
b. Frequency : Monthly
c. Effective Start Date : 01-Apr-2012
d. Click Ok and Save
Figure 6 – 6
Professional Tax Element Link Setup
N> IN HRMS Manager > Total Compensation > Basic > Link
1. Date Track to 01-Apr-2005.
a. Professional Tax Information

Figure 6 – 8
2. Enable above link in the screen shot.
Professional Tax Setup and Testing
a. Date Track to 01-Apr-2012
b. Query Employee Manager 1, Test 1
c. Click on Assignment Button
d. Click on Statutory Tab
Figure 6 – 9
e. Observe Profession Tax Organization is changed.

f. Click Ok and Save
g. Click Entries <Button>
h. Add Professional Tax Information Element to the Employee.
Figure 6 – 10
i. Save and Exit.
j. Click on Others and Quick Pay
k. Run Quickpay for April 2012
l. Check on SOE
Figure 6 – 11
This completes the Professional Tax Setup and Testing

7. ESI (Employee State Insurance)
1. ESI Organization Setup
a. ESI Information
b. ESI Challan
c. Representative Details
d. Declaration Details
2. ESI Element Link Setup
a. ESI Information
3. ESI Setup and Testing
ESI Tax Organization Setup
a. Name : IN ESI Tax Organization
b. Date : 01-JAN-2005
e. Add Classification : ESI Organization

Figure 7 – 1
f. Click Others and Select Representative Details.
Figure 7 – 2
g. Save and Close.
h. Click Others and Select ESI Information.
Figure 7 – 3
i. Save and Close
j. Click Others and Select ESI Challan. (Need to fill these details also.)
k. Click Others and Select Declaration Details. (Need to fill these details also.)
ESI Tax Element Link Setup
a. Date Track to 01-Apr-2005.
i. ESI Information
b. Enable above link.
ESI Setup to employee and Testing
b. Query Employee Employee 3 Test3
c. Click on Further Benefits Tab
d. Enter ESI Number <123456>
Figure 7 – 4
e. Save
f. Click on Assignment Button
g. Click on Statutory Tab

Figure 7 – 5
h. Observe Profession Tax Organization and ESI Organization They have separate Organizations,
Rest have Business Group Name.
i. Click Ok and Save
j. Click Entries <Button>
k. Add ESI Information Element to the Employee.
Figure 7 – 6
l. Observer ESI Information and Profession Tax Information are attached to employees in the
Element Entry From.
m. Click on Others and Quick Pay
n. Run Quickpay for April 2012
Figure 7 – 7
8. PF (Provident Fund)
I. Provident Fund Organization Setup
a. Provident Fund Info
b. PF Establishment Code
c. PF Office
d. PF Trust classification
e. PF Registered company
f. Recognized Provident Fund
g. EDLI Coverage
II. Provident Fund Element Link Setup
a. PF Information element
III. PF Setup and Testing
PF Organization Setup
N> India HRMS Manager > Work Structures > Organization > Description
a. Name : IN Provident Fund Organization
b. Date : 01-JAN-2005
e. Add Classification : Provident Fund Organization

Figure 8 – 1
f. Click Others and Select Provident Fund Info
Figure 8 – 2
g. Click Others and Select Representative details (Screen)
Figure 8 – 3
h. Save and Close.
i. Click others and Select Provident fund Challan. (Need to fill these details also.)
PF Element Link Setup
i. PF Information ( Information Element to hold PF calculation)
Figure 8 – 4
b. Enable above link.
c. Feed the PF Computation Salary and PF Computation Standard Salary balance to earning element
defined.
Figure 8 – 5
Figure 8 – 6
PF Setup to employee and Testing
b. Query Employee Employee 3 Test3
c. Click on Further Benefits Tab
d. Record Employee Details i.e .Provident Fund Number
Figure 8 – 7
e. Save
f. Click on Assignment Button
g. Click on Statutory Tab
Figure 8 – 8
h. Also Record PF Organization name in the Statutory Key flex field in Assignment window.
i. employee can choose any of the below three options
i. 'PF and EPS on Actual Salary',
ii. 'PF and EPS on Statutory Limit',
iii. 'PF on Actual Salary, EPS on Statutory Limit'
j. If user does not choose any value ,by default application uses option (c) for computing PF and
Pension
Figure 8 – 9
k. Click save
l. Click Entries <Button>
Figure 8 – 10
m. Add PF Information Element to the Employee
n. Observer PF Information are attached to employees in the Element Entry From.
o. Click on Others and Quick Pay
p. Run Quickpay for April 2012
Figure 8 – 11
9. Medical Reimbursements
1. Medical Reimbursement Element and Element Link Setup
a. IN Medical Reimbursements
b. Medical Reimbursements Bills
2. Medical Reimbursement Organization Setup
a. Benefit Element Details
b. Bill Declaration Info
3. Medical Reimbursement Setup and Testing
Medical Reimbursement Element and Element Link Setup
N> IN HRMS Manager > Total Compensation > Basic > Element Design Wizard
a. Name IN Medical Reimbursements
b. Reporting Name IN Medical Reimbursements
c. Description IN Medical Reimbursements
d. Primary Classification Fringe Benefits
Figure 9 – 1
f. Effective Start Date 01-Apr-2012
g. Should employees automatically receive this element (Standard Link)? NO

Termination Date
j. Calculation Rule Fringe Benefits
k. Should this element automatically recur or should it be entered explicitly for each payroll period in
which you want to process it ? Non Recurring
n. Is more than one entry of this element allowed for an employee in a pay period? Yes
o. Category Employees Welfare Expense
p. Enable Advances No
q. Is medical Yes
Figure 9 – 2
r. Click on Submit.
Figure 9 – 3
s. Link for IN Medical Reimbursements
Figure 9 – 4
t. Link for IN Medical Reimbursements Bills
Medical Reimbursement Organization Setup
a. Query for Business group IN Business Group (Documentation)
b. Select the Business Group Classification and click on Others <Button>

Figure 9 – 5
c. Select Benefit Element Details
d. Medical Elements Bill IN Medical Reimbursements Bills
e. Medical Payment Element IN Medical Reimbursements
f. Ignore LTC for now
Figure 9 – 6
g. Click Ok and Save
h. Select the Business Group Classification and click on Others <Button>
i. Select Bill Declaration Info
j. Make sure that values are blank

Figure 9 – 7
Medical Reimbursement Setup and Testing (Login as Employee)
N> India Employee Self Service > Bill Declaration > Medical Expenses
a. Click on Create Medical Expenses
Figure 9 – 8
b. Click on Submit
c. Login as Administrator or Professional User
N> India Professional User Self Service > Approve Expenses >Validate Medical Expenses >
d. Search for Employee based on criteria
Figure 9 – 9
e. Click on Action Button
Figure 9 – 10
f. Click on Submit Button
g. Run Payroll for the Employee in the month that is submitted.
N> India HRMS Manager> People >Enter and Maintain > Query Employee > Assignment Button >
Click on Entries Button >
h. Date Track to 02-Jan-2014
Figure 9 – 11
i. Here we verify the Elements created with values
j. Close and Click on Others Button and Select Quick Pay
Figure 9 – 12
10. House Rent Allowance
1. House Rent Allowance Element and Element Link Setup
a. IN House Rent Allowance
b. Taxable HRA
c. House Rent Information
2. House Rent Allowance Setup and Testing
House Rent Allowance Element and Element Link Setup
a. Name IN House Rent Allowance
b. Reporting Name IN House Rent Allowance
c. Description IN House Rent Allowance
d. Primary Classification Allowance
Figure 10 – 1

Termination Date
j. Calculation Rule Actual Expenses
which you want to process it? Recurring
o. Allowance Name House Rent Allowance
q. Nature of Expense Recurring
Figure 10 – 2
r. Click on Submit.
s. Create Element Link with Effective Date 01-Apr-2012 for IN House Rent Allowance
Figure 10 – 3
t. Create Element Link with Effective Date 01-Apr-2005 for Taxable HRA
Figure 10 – 4
u. Create Element Link with Effective Date 01-Apr-2005 for House Rent Information (Screen Shot not
provided.)
Formula Results
a. Name : IN House Rent Allowance
b. Click Find
c. Formula : IN_BASIC_SAL_CUSTOM
d. Name (Formula Results) : L_AMOUNT
e. Type (Formula Results) : Direct result.
f. Input Value : Pay Value
g. Units : Money
h. Save
Figure 10 – 5
HRA Setup to employee and Testing
IN HRMS Manager > People > Enter and Maintain >

b. Query Employee Manager1 Test1
c. Click on Address Button

Figure 10 – 6
d. Save and close
e. Click on Assignment Button
f. Click on Entries Button add IN House Rent Allowance
Figure 10 – 7
g. Save and Close (Observe Taxable HRA is added by Default)
h. How to Declare House Rent Information as Employee?

N> India Employee Self Service > Tax Declaration >
i. Click on Action Button on House Rent Information
Figure 10 – 8
ii. Click On Review and Submit.
i. Click on Others Button and Select Quick Pay (Run the Payroll for Jan 2014 as the Element “House
Rent Information” for the employee starts on the day the employee submits his House Rent in Tax
Declaration.)
Figure 10 – 9
11. Labour Welfare Fund
1. Labour Welfare Fund Organization Setup
a. Organization Classification - Factory or Shops/Establishment
b. Establishment Info or Factory Info
c. LWF state Rules at Business Group Level
2. LWF Information Element Link Setup
a. LWF Information element
3. LWF Setup and Testing
LWF Organization Setup
a. Name : IN LWF Organization
b. Date : 01-JAN-2005
e. Add Classification : Factory
Figure 11 – 1
f. Click Others and Select Factory Information
Figure 11 – 2
g. Click Others and Select Representative details (Screen)
Figure 11 – 3
h. Save and Close.
i. Click Others and Select LWF Challan Information. (Need to fill these details also.)
Defining frequency of contribution

i.e. LWF state rules at Business group Level
N> IN HRMS Manager > Work Structures > Organization > Query for Business Group ‘IN Business Group
(Documentation)’
a. Date Track to 01-Jan-2005.
b. Select the Classification Business Group
c. Click on Others Button and Select LWF State Rules

Figure 11 – 4
Figure 11 – 5
Figure 11 – 6
d. Save and close

LWF Element Link Setup
b. LWF Information ( Information Element to hold LWF calculation)
Figure 11 – 7
c. LWF Adjustment
Figure 11 – 8
d. LWF Process Separate
Figure 11 – 9
e. Enable all the above Element links
LWF Setup to employee and Testing
N> IN HRMS Manager > People > Enter and Maintain >
b. Query Employee 3 Test3
d. Click on Statutory Tab, record IN LWF Organization
Figure 11 – 10
e. Click save
f. Click Entries <Button>

Figure 11 – 11
g. Add LWF Information Element to the Employee Assignment to initiate LWF calculations optionally,
record if the employee is exempt from labor welfare deduction. Select the exemption reason in the
LWF Information element.
h. You can configure your exemption reasons using the user lookup IN_LWF_EXEMPTION
i. frequency of employee and employer contributions are configured in the user table
IN_LWF_CONTRIBUTION_AMOUNT
j. Click on Others and Quick Pay
k. Run Quickpay for DEC 2012
(LWF is usually processed in December Month for AP state, if you run for other months it may not
generate values. Please verify each State Rules for further Clarification on when LWF will be
deducted.)
Figure 11 – 12
Figure 11 – 13
12. Leave Travel Allowance (LTA)
1. Leave Travel Concession Element and Element Link Setup
a. IN Leave Travel Concession
b. LTC Bill Declaration
2. LTC Organization Setup
a. Benefit Element Details
b. Bill Declaration Info
3. LTC Setup and Testing
Leave Travel Concession Element and Element Link Setup
a. N> IN HRMS Manager > Total Compensation > Basic > Element Design Wizard
b. Name IN Leave Travel Concession
c. Reporting Name IN Leave Travel Concession
d. Description IN Leave Travel Concession
e. Primary Classification Earnings
Figure 12 – 1
f. Input Currency INR
g. Effective Start Date 01-Apr-2005

h. Should employees automatically receive this element (Standard Link)? NO
i. At which point in the termination process are employees no longer eligible for this element? Final
Close
j. Click on Next Button
k. Calculation Rule Leave Travel Concession
l. Should this element automatically recur or should it be entered explicitly for each payroll period in
which you want to process it? Non Recurring
m. Process once per payroll period? Yes
n. How is this element processed per pay period? Element is processed and paid with other earnings.
o. Is more than one entry of this element allowed for an employee in a pay period? No
p. Enable Advances Yes
Figure 12 – 2
q. Click on Submit.
Figure 12 – 3
r. N> IN HRMS Manager > Total Compensation > Basic > Link
s. Link for IN Leave Travel Concession
Figure 12 – 4
t. As we have set the Enable Advances flag to Yes, the system creates the following user defined
elements, Create link for all the user defined elements.
 IN Leave Travel Concession Advance: Element to record the advance payment against LTC.
 IN Leave Travel Concession Recover: Element to recover pending advance payments.
 IN Leave Travel Concession Adjust: Element to adjust the advance payment.
The system creates the user defined formula <USER_NAME>_LTC_ADV_CALC, and links it to the Advance element for
processing advances.
Record LTC Element at BG Level
a. Query for Business group IN Business Group (Documentation)
b. Select the Business Group Classification and click on Others <Button>

Figure 12 – 5
c. Select Benefit Element Details
d. LTC Element IN Leave Travel Concession
Figure 12 – 6
e. Click Ok and Save
f. Select the Business Group Classification and click on Others <Button>
g. Select Bill Declaration Info
h. Make sure that values are blank

Figure 12 – 7
Note: When it is locked, the employee can only view the details of bills previously submitted. He can’t create any new bills.
During the locking period, only the professional user will be able to change the bill
Leave Travel Concession Bill Declaration and Testing (Login as Employee)
N> India Employee Self Service > Bill Declaration >LTC Expenses
a. Click on Create LTC Expenses
Figure 12 – 8
b. Click on Action
c. Snapshot of LTC Bill Entry Page and Review page

Figure 12 – 9
Figure 12 – 10
Note: Only the fields available in details region of Hide/Show block i.e Ticket Number, Employee Comments and Employer
Comments are non-mandatory. Age and Relationship are non-editable texts that store information from Contacts form.
d. Review Page
e. The same details entered in the entry page are displayed in the review page. In case, the employee
has updated any data, the record will be tagged with the ‘Changed’ icon similar to that done in
Medical Page. The total claim amount will be displayed in the review page. When the employee clicks
on ‘Submit’
Figure 12 – 11
f. Login as Administrator or Professional User
N> India Professional User Self Service > Approve Expenses >Validate LTC Expenses
Validate LTC Expenses – Professional user can view and enter the exempted bill amount of each of the LTC Bills. When
user clicks ‘Submit’, a single LTC Earnings element will be created with ‘Ticket Fare’ equaling the total fare of the LTC.
g. Search for Employee based on criteria

Figure 12 – 12
h. Click on Action Button
Figure 12 – 13
i. Click on Submit Button
Note: When the professional user presses ‘Submit’, single element entry for ‘LTC’ element shall be attached to the
assignment as of the Entry Date entered in the Search page, with Ticket Fare and Employer Contribution as the total
exempted bill amount. Please note that employers will have to update the actual employer contribution through ‘Change
LTC Payment’ if they wish to pay an amount that is different from the exempted bill amount. The entry will be created for the
LTC element that was chosen at the BG level.
j. Review Page for LTC

Figure 12 – 14
N> India Professional User Self Service > Approve Expenses >Change LTC Payment
The element entry created with Exempted Ticket Fare and Employer Contribution equal to the total exempted bill amount,
when the PU first approved the LTCBills. Using this Change LTC payment, PU can change the ‘Employer Contribution’ i.e.
Payment Amount. He can also change other inputs like ‘Carry Over from Previous Block’.
Figure 12 – 15
N> India HRMS Manager> People >Enter and Maintain > Query Employee > Assignment Button > Click
on Entries Button >
k. Date Track to 02-Jan-2014
Figure 12 – 16
l. Here we verify the Elements created with values
m. Close and Click on Others Button and Select Quick Pay
Figure 12 – 17
13. Bonus
1. Bonus Element and Element Link Setup
a. IN Bonus or Lump sum
b. Bonus Separate Information
2. Bonus Testing for an Employee
Bonus Element Setup
N> IN HRMS Manager > Total Compensation > Basic > Element Description
a. Name IN Bonus or LumpSum
b. Reporting Name IN Bonus or LumpSum
c. Description IN Bonus or LumpSum
d. Primary Classification Earnings
e. Non Recurring Yes
f. Termination Last Standard Process
g. Multiple Entries <Checkbox> Yes
h. Process in Run <Checkbox> Yes
i. Save
Figure 13 – 1
j. Click on Advanced Tab
k. Process Separate <Checkbox> Yes
Figure 13 – 2
l. Save
m. Click on Input Values <Button>
n. Add Bonus Amount as shown in below screen shot.
Figure 13 – 3
o. Save
p. Close the window
q. Click on Extra Information <Button>

r. Add Type Bonus Tax Information
i. TDS Type on Bonus: Lump Sum Deduction
ii. TDS Percentage:
Figure 13 – 4
s. Fixed percentage - to calculate tax based on the percentage entered in the TDS Percentage field.
t. Lump Sum Deduction - to calculate tax based on projected earnings and bonus. The application then
deducts the tax as a lump sum amount.
u. Distributed Over Pay periods - to calculate tax based on projected earnings and bonus. The
application then distributes the tax over the remaining pay periods.
v. Save
w. Name IN Bonus or LumpSum
x. Click Find
I. Formula IN_BONUS_XFER
i. Processing Rules Name : Active Assignment
ii. Name (Formula Results) : BONUS
iii. Type (Formula Results) : Direct result
iv. Input Value : Pay Value
v. Units : Money
II. Name (Formula Results) : BONUS_AMOUNT
i. Type (Formula Results) : Indirect result
ii. Element Name : Bonus Separate Information
iii. Input Value : Bonus Amount
iv. Units : Money
III. Name (Formula Results) : TAX_PERCENTAGE
iii. Input Value : TDS Percent
iv. Units : Character
IV. Name (Formula Results) : TDS_TYPE
iii. Input Value : TDS Type
iv. Units : Character
v. Save
Figure 13 – 5
Bonus Element Link Setup
b. Bonus Separate Information ( Information Element to hold LWF calculation)
Figure 13 – 6
c. Save
d. IN Bonus or LumpSum
Figure 13 – 7
e. Save
Bonus Testing for an Employee
a. Date Track to 01-Jan-2014.
b. Query Employee Manager 1 Test 1
d. Click Entries <Button>
e. Add Element IN Bonus or LumpSum
Figure 13 – 8
f. Click on Others and select Quick Pay
Figure 13 – 9
g. Make sure you choose run type as Process Separate (This employees Quick Pay for Jan 2014 has
already been run for House Rent Allowance earlier itself. Here we are running for Process Separate)
h. Run the Quick Pay.

Figure 13 – 10
Figure 13 – 11
14. Conveyance Allowance
1. Conveyance Allowance Element and Link Setup
2. Conveyance Testing
Conveyance Allowance Element and Link Setup
a. Name IN Conveyance Allowance 800
b. Reporting Name IN Conveyance Allowance 800
c. Description IN Conveyance Allowance 800
d. Primary Classification Allowance
Figure 14 – 1
Termination Date
j. Calculation Rule Actual Expenses

o. Allowance Name Conveyance Allowance
Figure 14 – 2
r. Click on Submit.
s. Create Element Link with Effective Date 01-Apr-2012 for IN Conveyance Allowance 800
Figure 14 – 3
Conveyance Allowance Testing
b. Query Employee Employee 4 Test 4
d. Click Entries <Button>
e. Add Element IN Conveyance Allowance 800
Figure 14 – 4
f. Save and Close
g. Click on Others and select Quick Pay

Figure 14 – 5
h. Run the Quick Pay.
Figure 14 – 6
Here Allowance is 1000, Tax benefit is applicable only for 800INR
Figure 14 – 7
i. Screen shots of SOE Apr 2012 are shown above.

15. Setting up Perquisites
1. Perquisites Element and Link Setup
2. Perquisites Testing
Perquisites Element and Link Setup
Perquisites are non-monetary or monetary benefit provided to employee (by employer) in addition to his salary.
You can create the following perquisite elements through the Element Design Wizard:
i. Company Accommodation
ii. Motor Car
iii. Loan at Concessional Rate
iv. Company Movable Assets
v. Transfer of Company Assets
vi. Free Education
vii. Lunch Perquisite
Predefined other perquisites are:
viii. Domestic Servant
ix. Gas/Water/Electricity
x. Shares
Perquisites are set up using Element Design Wizard. Click Create and in the Create Element Screen, define Perquisite
elements. Define the appropriate secondary classification namely Monetary Perquisite/Non Monetary perquisite for the
element.
Company Accommodation
Employees transferred to a different location or on deputation can be provided an accommodation by the company. Based
on the rent paid by the employer, the perquisites value needs to be added to the taxable salary for the employee. To
process the perquisite, an entry for the element ‘Company Provided Accommodation’ needs to be created.
a. Name IN Company Accommodation
b. Reporting Name IN Company Accommodation
c. Description IN Company Accommodation
d. Primary Classification Perquisites
Figure 15 – 1
f. Effective Start Date 01-Apr-2006 (Date is 01-Apr-2006 and not 01-Apr-2005)
g. Should employees automatically receive this element (Standard Link) ? NO
h. At which point in the termination process are employees no longer eligible for this element? final
Close
i. Secondary Classification Monetary Perquisite
j. Click on Next Button
o. Allowance Name House Rent Allowance
r. Project Taxable Value Yes
s. Paid and Displayed as Earnings Yes
Figure 15 – 2
t. Click on Submit.
u. Create Element Link with Effective Date 01-Apr-2005 for IN Company Accommodation
Figure 15 – 3
Formula Results
a. Name : IN Company Accommodation
b. Click Find
c. Formula : IN_COMPANY_ACCOMMODATION
Figure 15 – 4
Perquisite Setup to employee and Testing
IN HRMS Manager > People > Enter and Maintain >

b. Query Employee Manager1 Test1
d. Click on Entries Button add IN Company Accommodation
Figure 15 – 5
e. Following information needs to be entered:
i. Benefit Start Date: Date from which the accommodation is provided
ii. Benefit End Date: Date till which the accommodation is provided
iii. Place: Type of place, based on the population of the place. To be selected from the list of
values provided
iv. Cost of furniture owned: monthly rent
v. Rent of furniture leased: monthly rent
vi. Rent Paid by Employer: monthly rent
Once the information is entered, the system will calculate the company accommodation perquisite to be added to
the employee taxable salary.
vii. Save
viii. Attach the predefined element Employer Tax Iterations to the employee if setting up
Employer Paid Tax

f. Click on Others Button and Select Quick Pay (Run the Payroll for Jan 2014 as the Element for IN
Company Accommodation got created in that month.)
Figure 15 – 6
16. Statement of Earnings Breakup (SOE Breakup)
Components of SOE
a. Personal Information
b. Further Person Information
c. Payroll Processing Information
d. Earnings
e. Advances
f. Fringe Benefits
g. Termination Payments
h. Deductions
i. Net Pay
j. Taxable Perquisites
k. Employer Charges
l. Balances
i. Personalize "Balances"
ii. Balances
iii. Description
iv. Salary (Section 17(1))
v. Value of Perquisites (Section 17(2))
vi. Profit in lieu of salary (Section 17(3))
vii. Gross Salary
viii. Allowances under Sec 10
ix. Deductions under Sec 16
x. Total Chapter VI A Deductions
xi. Total Income
xii. Tax on Total Income
xiii. Total Tax payable
xiv. Income Tax till Date
xv. Balance Tax
m. Payment Details
n. Other Element Information
o. Other Balance Information
p. Leave Information
q. Leave Taken
r. Messages to Employee
Details about the SOE components
1. Personal Information: This Region holds Personal Information like Employee Number,
Assignment Number, Employer Name, Location, Organization, Job, Position, Grade, Group, National
Identifier, Payroll, and Salary Basis.
Figure 16 – 2
2. Further Person Information: This Region holds Further Personal Information like Date of Birth, PAN,
Superannuation Number, Residential Status, Resident and ordinarily resident in India, Date of Joining, PF
Number, ESI Number.
Figure 16 – 3
3. Payroll Processing Information: This Region displays information like Period, Period Start Date, Pay Date,
Period End Date.
Figure 16 – 4
4. Earnings: This region displays all the earnings for an employee. (Elements like Basic Salary, Conveyance
Allowance, House Rent Allowances etc)
Figure 16 – 5
5. Advances : Displays Advance payments

6. Fringe Benefits : Displays Medical Reimbursements
7. Termination Payments : Displays seeded termination payment element results.
8. Deductions: This region displays all the Deductions like Professional Tax, Income Tax, Provident Fund,
ESI , LWF etc
Figure 16 – 6
 How is Professional Tax Calculated?

Professional Tax is a statutory deduction fixed by the State Government basis the gross salary earned by
an individual. Each state has different PT slabs for the same income group.
 How is Provident Fund Calculated?
The PF contribution is calculated @ 12% of your Basic Salary
 How is LWF Calculated?
Labor Welfare Fund deduction is a state specific nominal fixed amount that is deducted basis the state in
which the employee is working. Each state has its own defined amount of LWF contribution.
 How is ESI Calculated?
An employee qualifies for ESI deduction if his / her monthly gross salary is less than Rs.15, 000/- and
deduction is done at 1.75% of your monthly gross salary.
9. Net Pay : This value is calculated (Earnings – Deductions)
Figure 16 – 7
Net Pay : (Net Earnings-Deductions) = 1,11,838

Net Pay : (1,40,800-28,962.00) = 1,11,838
10. Taxable Perquisites
Figure 16 – 8
This section displays any perquisite calculated for the employee.
11. Employer Charges
Figure 16 – 9
EPS = 541 (This is 12% of 6500 deducted from every employee)

Employer PF Contribution: - 12000 = 11459+541(EPS)
How EDLI Works?
As per the Act, the scheme requires only the employer’s contribution towards the Provident Fund Authorities, to
provide a life cover to its members.
The employer needs to contribute 0.5 per cent of the basic salary of each employee’s wages towards the EDLI,
subject to a maximum of Rs 6500. The employer would also need to contribute 0.01 per cent of the monthly wage
towards administrative charges to the Regional Provident Fund Commissioner (RPFC).
The maximum amount payable under the Act is equal to

the average balance in the previous 12 months in the PF account, where such balance is less than Rs 35,000 and
if the balance is greater than Rs 35,000, the average (as stated in pint (i) above) in addition to 25 per cent of the
balance, subject to a maximum of Rs 60,000.
As per section 17(2A) of the Employee Provident Fund and Miscellaneous Provisions Acts 1952, the employer may
be exempt from contributing to EDLI if he is contributing to an insurance scheme, approved by the RPFC, offering
better benefits in lieu of EDLI.
Balances
Figure 16 – 10
I. Salary Section 17(1)

i. {Basic Salary (1,00,000) + Conveyance Allowance(800) + House Rent Allowance (40000)} =
1689600
ii. _YTD + Pay Value + (Standard Value * Remaining number of Months)
iii. This can include Dearness Allowance, Special Allowance or all the components that are paid
as earnings to the employee
II. Value of Perquisites (Section 17(2))
i. None in this SOE
III. Profile in Lieu of Salary (Section 17(3))
i. None in this SOE
IV. Gross Salary
i. Total Salary Paid to employee
V. Allowances Under Sec 10
i. {House Rent Allowance (40000-10%of Basic Salary)+ Conveyance Allowance (800) } * 12 =
369,600.00
VI. Deductions Under Sec 16
i. Professional Tax (200)*12 = 2400
VII. Total Chapter VI A Deductions
i. Tax Deductions declared by Employee
Figure 16 – 11
Total of 35000+ 12% of Basic Salary for Year has been deducted in the SOE too. Total
comes around 35000 + 144000 = 179000
But only 1,00,000 is exempted.
VIII. Total Income

a. 1,217,600.00 = Gross Salary (1,689,600.00) - Allowances under Sec 10 (369,600.00) -
Deductions under Sec 16 (2,400.00) -Total Chapter VI A Deductions (1,00,000.00)
IX. Tax on Total Income
a. 195,280.00=
b. Tax Slabs in India in 2014-2015
Where the total income does not Nil

exceed Rs. 2,00,000/-.
Where the total income exceeds 10% of amount by which the total
Rs. 2,00,000/- but does not exceed income exceeds Rs. 2,00,000/-.
Rs. 5,00,000/-. Less: Tax Credit - 10% of taxable
income upto a maximum of Rs.
2000/-.
Where the total income exceeds Rs. 30,000/- + 20% of the amount
Rs. 5,00,000/- but does not exceed by which the total income exceeds
Rs. 10,00,000/-. Rs. 5,00,000/-.
Where the total income exceeds Rs. 130,000/- + 30% of the amount
Rs. 10,00,000/-. by which the total income exceeds
Rs. 10,00,000/-.
Here in this case 1,30,000 + 0.30 * 2,17,600 = 195280
X. Total Tax Payable

a. a. This includes Cess and Sec and HE Cess
b. b. Tax on Total Income (195,280.00) + Cess (3912) + Sec and HE Cess (1956) =
2,01,148.00
XI. Income Tax till Date
XII. Balance Tax
Payment Details
Figure 16 – 12
This section displays the payment method details processed by Prepayments

17. Retro Pay for India Payroll
RetroPay – Intro & Basic setup
Recalculate the retrospective changes from any previous completed Payroll period and get the respective
retro element entries in the current period to be paid.
A. Enable Dynamic Triggers
N>Global HRMS Manager > Other Definitions > Dynamic Triggers
Figure 17 – 1
Figure 17 – 2
B. Functional Areas
N>Global HRMS Manager > Other Definitions > Functional Areas
Figure 17 – 3
C. Event Group
N>Global HRMS Manager > Other Definitions > Table Event Groups
Figure 17 – 4
D. Define Retro elements with Components, Time Spans & Balance feeds
N>Global HRMS Manager > Total Compensation > Basic > Element Description
Figure 17 – 5
E. Create Element Links
N>Global HRMS Manager > Total Compensation > Basic > Link
Figure 17 – 6
F. Run Retro-Notifications Report (Enhanced) / Define Retro Assignments
Figure 17 – 7
G. Run Retropay (Enhanced)
Figure 17 – 8
RetroPay for India Payroll

Enhanced Retropay is supported by India Payroll
 For Arrears, Recalculations, Salary Adjustments & Section 89 Relief Calculations
 HRA arrears calculation - Retropay is mandatory
Create the Nonrecurring Retro element with the same classification as with the base element using EDW.
 Do not select 'Yes' for the Balance Feed Configurations except for Arrear elements. PF/PT/ESI
balance feeds required for Arrear element.
 Priority of the Retro Components is :
Salary Adjustments > Section 89 Relief Calculations > Recalculations >Arrears.
 Component Setup
 All arrears require Arrears component with ‘Default Component’ selected.
 For salary corrections, use component 'Salary Adjustments' from Retropay Status page
 Recalculations – legislative rate changes
 Relief Section 89 Calculations – span across Financial Years
House Rent Allowance
House Rent Information (HRI)

 Added Retro event ‘IN Retro Event Group’
 Now Self Service allows to update HRI element entry with start date of the period or Assignment,
whichever is greater.
 HRI elements need to go via Self Service – Recommended
 House Rent Allowance (HRA)
 Arrears Taxable HRA element for retro components of Taxable HRA
 New balance ‘Retro Taxable House Rent Allowance’ feeds Arrears Taxable HRA
 Function taxable_hra() in the package pay_in_tax_utils updated
 Salary Arrears element should not feed the balance 'Salary for HRA and Related Exemptions'.
 House Rent Allowance Arrears element should have a processing priority greater than 15700
(For example 16000).
Retro for PT/PF/ESI

 Retro element should not be fed with PT/PF/ESI Computation balance.
 Arrear element shall be fed with PT/PF/ESI Computation balance.
 Use ‘Salary Adjustment’ or ‘Recalculation’ component if retrospective calculation of PT / PF/ ESI
is required.
Retro for Section 89 Relief Calculation
 Define ‘Start of Time’, ‘End of Previous Fiscal’, ‘Start of Current Fiscal’ & ‘End of Time’ Retropay
elements properly.
 Identifies the relief calculations from previous Financial Year.
 For More information, How Section 89 Relief Calculation Works (Doc ID 1559625.1)
18. Flow Charts
This section provides the flow charts for the entire process.
Tax Process Flow

India Payroll Process Overview

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Oracle E-Business Suite HCM

India Payroll - Setup Document

Creating Business Group

1. Log in the instance.

2. Navigate to Organization window

5. Change from date to 01-Jan-2000.

6. Select Hyderabad in the location field.

7. Select Internal to indicate that this organization is within your enterprise.

8. Save your work.

9. Navigate to Organization window

12. Ensure that Enable is checked.

13. Save your work.

Entering Additional Information

14. Click on the Others <Button>.

17. Fill in the following information.

a. Short Name: IN_BG

b. Employee Number Generation: Automatic

c. Applicant Number Generation: Automatic

d. Contingent Worker Number Generation: Automatic

e. Grade Flexfield Structure: Vision India Grade Flexfield

f. Group Flexfield Structure: Vision India People Group Flexfield

g. Job Flexfield Structure: Vision India Job Flexfield

h. Costing Flexfield Structure: Vision India Cost Allocation Flexfield

i. Position Flexfield Structure: Vision India Position Flexfield

j. Competence Flexfield Structure: Vision India Competence Flexfield

k. Legislation Code: India

m. Fiscal Year Start: 01-Apr-2000

n. Minimum Working Age: 18

o. Maximum Working Age: 60

18. Click on the OK button.

19. Save your work.

20. Return to Organization window.

Classifying a Business Group as HR Organization

21. Navigate to Organization window

24. Ensure that Enable is checked.

25. Save your work.

27. Ensure that Enable is checked.

28. Save your work.

29. Navigate to Organization window

32. Ensure that Enable is checked.

33. Save your work.

The following Organization Classifications are present in Indian legislation.

35. Ensure that Enable is checked.

36. Save your work.

38. Ensure that Enable is checked.

39. Save your work.

41. Ensure that Enable is checked.

44. Ensure that Enable is checked.

45. Save your work.

47. Ensure that Enable is checked.

48. Save your work.

50. Ensure that Enable is checked.

51. Save your work.

be covered in Provident Fund Setup: Chapter 8)

53. Ensure that Enable is checked.

54. Save your work.

will be covered in Professional Tax Setup: Chapter 6)

Granting Access for Business Group

1. Navigate to responsibility window.

N>System Administrator > Security > Responsibility > Define

a. Responsibility Name: IN HRMS Manager

b. Application: Human Resources

c. Responsibility Key: IN_HRMS_MANAGER