Issue/Symptom/Question

How do I refund the local tax money to an employee?

Environment

Function: How to refund tax money to an employee

Version: 20.4

Module: Payroll

Product:Core PENTA

Resolution/Fix/Answer

The system cannot reduce a tax to make a payment to an employee. Therefore, a reimbursement should be used to refund the money. Once the payroll is complete, run a reimbursement history to see the employees that received the payback.

A Manual payment adjustment can be used to reduce the tax and offset with the reimbursement so a net zero payment occurs to offset the entry. The reimbursement will charge a liability or expense account. A Payroll Adjustment was account will need to be used.

Steps in the Process:

1. Pay the money back with the reimbursement
   
   1. PENTA books the expense
2. Offset the reimbursement with the Tax using the Manual Payment Adjustment process
   1. PENTA offsets the expense
3. Net impact is zero in the GL and the sub-ledger is up to date for W-2 purposes