Payroll Component is a payroll component other than basic salary which increases or decreases employee Take Home Pay.

Payroll components can consist of:

• Allowance: Components that increase employee income outside of the basic salary. 
• Deductions: Components of deductions from employee income.
• Benefits: Components that are covered by the company for employees but do not add to the employee's take-home pay income, for example, BPJS Employment and BPJS Health.

Make sure you have arranged a payment schedule first. Following are the steps for managing payroll component settings:

1. On the Dashboard menu, click the "Profile" icon at the top right. Then click "Company Settings".
   
2. Select the Payroll menu and click the "Payroll Component" tab.
   
3. Fill in the payroll component other than the basic salary which is to increase or decrease the employee's take-home pay in the Payroll Component section. There are 3 component parts, namely  Allowances, Deductions, and Benefits.
   
   

   No	Menu	Explanation
   1	Allowance	Is a component that is to increase employee income outside of the basic salary. If you want to add allowances as needed, click "Add Allowance". To learn how, read Part A. To learn how, read Part A.
   2	Deductions	Is a deductible component of employee income such as late deductions. If you want to add allowances as needed, click "Add Deduction". To learn how, read part B.
   3	Benefit	Is a component that is borne by the company for employees but does not add to an employee take-home pay such as BPJS Employment and BPJS Health. If you want to add benefits according to your needs, click "Add Benefit". To learn how, read part C.

4. If you want to add a fixed number (Absolute) for formula purposes, click "Add Custom Rate". This number is used so that there is no need to change the entire formula, just by editing the nominal custom rate. To learn how, read part D.
   
5. If the input payroll is in a foreign currency, click "Add Currency Rate" to add currency. To learn how, read part E. 
   
   

   Payment of employee salaries will always be in Rupiah (Rp) so that employees who receive a basic salary in a foreign currency will receive the take-home pay, which is the amount of the base salary x currency rate. 

A. How to Add Allowance

Allowance is a component that adds to employee income outside of the basic salary. Allowance can be in the form of transportation money, food money, holiday allowance (THR), and so on.
Here are the steps for adding allowance:

1. In the Payroll Component section, click “Add Allowance" to add an allowance.
   
2. Specify the name of the allowance in the Allowance Name column. Then, fill in the total benefit policy value in the Amount section. Select Default in the Currency dropdown to use IDR or use the foreign currency (SGD, GBP, USD) available in the Currency dropdown. Then, click on the Payroll Payment Schedule section to select a payroll cut-off that is different from the default (the settings you have set in the payment schedule).
   
3. Select the benefit period given to employees in the Type section.
   
   
   • Monthly: The nominal payroll components are calculated per month. If activated, the Default and Prorate options appear.
     • Default: If activated, the allowance components created will be automatically assigned to all employees with Assign Allowance for New Employee on the Yes button. However, if the allowance only applies to certain divisions or positions, you can use the Assign Allowance for New Employee filter button, then select "Select Filter" and choose based on Organization/Job Position/Job Level/Branch/Payment Schedule which allowance will be given.
       
     • Prorate: If activated, the payroll component for employees who join in the middle of the cut-off period will automatically be calculated proportionally according to the predetermined prorate provisions.
   • Daily: The nominal payroll component is calculated per day with the condition that employees must be present (attendance code H), if they are not present they will not be paid. If activated, the Default and Maximum Amount options appear.
     • Default: The default function in this section is the same as the default on the monthly tab.
     • Maximum Amount:
       
       • Not Use: There is no maximum nominal value.
       • Basic Salary Percentage: Determined from the salary percentage, for example, 60% means the payroll component is 60% of the basic salary.
       • Custom Amount: The nominal payroll component comes from a predetermined absolute number.
         
   • One Time: The nominal value of this component is not fixed and must be input by the user every month during the run payroll process. The nominal value of this component will automatically be zero every month. If activated, the Bonus option will appear which will affect the tax calculation.
     • Bonus: If activated, the December 1721-A1 report will be classified as gross income point 8 (tantiem, bonuses, gratuities, production services, and THR). However, if it is not activated, the bonus component is included as gross income point 3 (other allowances, overtime pay, and so on).
4. Select the policy regarding taxation of benefits in the Tax section.
   
   
   • Taxable: The benefit component is included in the tax calculation. 
   • Non-Taxable: These components are not included in the tax calculation.
5. Click "Formula" if the benefit policy is calculated using a formula. This setting is to calculate the nominal allowance using a certain formula or criteria.
   
   

   Important Contact our support team at support-hr@mekari.com or a specialist team to get help with formula creation.

6. Click "Confirm"  to save. 

   

B. How to Set Deduction

Deduction is a component of reducing employee income. You can add deductions according to company policy, for example late deductions.

Here are the steps:

1. In the Payroll Component section, click "Add Deduction" to add deductions or deductions to employee income.
   
2. Fill in the name of the deduction policy in the Name section.
   
   
3. Fill in the amount of the deduction policy value in the Amount section.
   
   
4. Check "DPLK" if you want to apply pension deductions.
   
5. Select  DPLK type.
   

   There are two types, namely:
   - Monthly: The nominal payroll component will be calculated per month (every month there is a deduction from this payroll component).
   - One time: The nominal components are not fixed and must be input by the user every month during the run payroll process. The nominal component with the one-time type will automatically be zero every month.

6. Next, you can tick Default if you want all employees to get the DPLK deduction. Check Pro Rate if you want the deduction to be made on a prorated basis or tick Backpay if the component has backpay or payment in installments.
   
   

   If you check Default, information will appear like the following.
   
   Select Yes if you want all employees to get deductions or Select Filter if you want to select employees from certain organizations or positions.

7. Select the DPLK Tax settings, whether you want to pay it by the employee (By Employee) or the company  (By Company).
   
8. Select foreign currency, if using a foreign currency exchange rate other than IDR in the Currency section.
   
   
9. Click "Payroll Payment Schedule" to select a payroll cut-off that is different from the default.
   
10. Select the deduction period given to employees in the Type section.
    
    

    - Monthly: The discount policy is given monthly.
    - Daily: The discount policy is given daily.
    - One Time: This discount policy is only given occasionally.

11. Select a policy regarding taxation of deductions in the Tax section.
    
    
12. If you check "Default" then new employees will have the right to the deduction policy.
    
13. Click on the "Formula" section if the discount policy is calculated using a formula.
    
14. Click "Confirm"  to save. 
    

C. How to Add Benefits 

Benefit components are components that are borne by the company for employees but do not add to the employee's take-home pay (THP) income, for example: BPJS Employment and BPJS Health. Therefore, the BPJS Employment and BPJS Health Benefits list cannot be deleted and can only be edited.

Here are the steps:

1. In the Payroll Component section, click "Add Benefit" to add employee benefits.
   
2. Hence, the following pop-up appears and you can complete the data in the empty columns.
   

   No.	Column/Button Name	Description
   1	Name	Fill in the benefit name here.
   2	Amount	Fill in the benefit amount here.
   3	Currencies	The default currency is IDR (Rupiah), to change the currency value used, click the "down arrow" icon.
   4	Payroll Payment Schedule	The default payroll schedule is a schedule that follows the payroll cut-off scheduling settings that you have previously set. Learn the guide to setting up a payroll payment schedule here. If you do not want to use the default cut off schedule, then you can click the "down arrow" icon to select another payroll payment schedule.
   5	Type	Select the benefit period provided to the employee. Monthly: The nominal payroll components are calculated per month. If activated, the Default and Prorate options appear. Default: If activated, the allowance components created will be automatically assigned to all employees with Assign Allowance for New Employee on the Yes button. However, if the benefit only applies to certain divisions or positions, you can use the Assign Allowance for New Employee filter button, then select "Select Filter" and choose based on Organization/Job Position/Job Level/Branch/Payment Schedule which benefit will be provided. Prorate: If activated, for employees who join in the middle of the cut-off period, the payroll component will automatically be calculated proportionally according to the predetermined prorate provisions. Daily: The nominal payroll component is calculated per day with the condition that employees must be present (attendance code H), if they are not present they will not be paid. If activated, the Default and Maximum Amount options appear. Default: The default function in this section is the same as the default on the monthly tab. Maximum Amount: Not Use: There is no maximum nominal value. Basic Salary Percentage: Determined from the salary percentage, for example, 60% means the payroll component is 60% of the basic salary. Custom Amount: The nominal payroll component comes from a predetermined absolute number. One Time : The nominal value of this component is not fixed and must be input by the user every month during the run payroll process. The nominal value of this component will automatically be zero every month. If activated, the Bonus option will appear which will affect the tax calculation. Bonus: If activated, the December 1721-A1 report will be classified as gross income point 8 (tantiem, bonuses, gratuities, production services, and THR). However, if it is not activated, the bonus component is included as gross income point 3 (other allowances, overtime pay, and so on).
   6	Taxes	Select the policy regarding taxation of benefits in the Tax section. Taxable: The benefit component is included in the tax calculation.  Non-Taxable: These components are not included in the tax calculation.
   7	Tax Type	If this benefit is taxable, then you can choose one type of tax that will be charged. Same as salary: Tax is the same as payroll tax. Gross: Employees bear the amount of income tax themselves. Gross up: Employees receive tax benefits equal to the amount of tax withheld. Net: The company bears employee taxes. Click "Formula" if the benefit policy is calculated using a formula. This setting is to calculate the nominal allowance using a certain formula or criteria. Important Contact our support team at support-hr@mekari.com or the specialist team to get help with formula filling.

3. Click "Confirm" to save, or "Close" to cancel the added benefit.
   
   

   You can change the benefit settings by clicking on the benefit whose policy you want to change according to the explanation in the points above. 

4. You can also edit the BPJS Employment and BPJS Health benefit components by clicking on the benefit.
   
5. The pop-up that appears is different from other benefits.
   

   No.	Column/Button Name	Description
   1	Calculations	Choose the BPJS calculation method using a custom formula that you can adjust yourself or Normal Calculation (Calculation based on the latest BPJS Employment/Health regulations).
   2	Payroll Component Included	Select and set the payroll components that count with these BPJS-TK/Health benefits. Then, click "Add". Then, the payroll components included that you have selected will be listed under Settings. You can delete it by clicking the “cross” icon.
   3	Settings	Include Backpay: Click to include pending or unpaid payroll to employees for a certain period of time (Backpay) if you. Full Salary: This component is a benefit for employees with a full salary given. Prorate Salary: This component is a benefit for employees who receive a prorated salary (work part-time).
   4	Other Components	Include other components if needed here.
   5	Save	If the BPJS-TK/Health benefit component has been edited, click "Save".

6. Click "Confirm" to save, or "Close" to cancel the added benefit.

D. How to Add Custom Rate

This feature functions to add fixed (absolute) numbers for the purposes of creating formulas. This number is used so that users do not need to change the entire formula, just edit the nominal custom rate.

Important 
Contact our support team at support-hr@mekari.com or the specialist team to get help creating formulas using the custom rate function.

Here are the steps:

1. In the Payroll Component section, click "Add Custom Rate".
   
2. Enter the name of the custom rate in the empty Name column. You can choose a pre-existing custom rate name or create a new one by clicking the "down arrow" icon. Then, determine the effective date of the rate in the Effective Date column and enter the rate value in the Amount column.
   
3. Click "Confirm" to save.
   
4. Therefore, the Custom Rate that has been created will appear in the following list. You "Edit" and "Delete" the Custom rate that has been created.
   

E. How to Add Currency Rate

This tab functions to add currency if the basic salary entered is in foreign currency. Employee salary payments will always be in Rupiah, so if an employee receives a basic salary in a foreign currency, the Take Home Pay received is the value of the basic salary multiplied by the currency rate. If there is a change in the currency exchange rate, the change needs to be made manually. Here's how:

1. Enter the currency name in Name select a pre-existing custom rate name or create a new one by clicking the "down arrow" icon. Then, determine the effective date of the rate in the Effective Date column and enter the rate value in the Amount column.
   
   

   The example above is the addition of the INR (Indian Rupee) currency value. The amount listed will be multiplied by the value of the employee's basic salary. Hence, employees will get a basic salary in Rupees.

2. Click "Confirm" to save.
   
3. Henceforth, the Currency Rate that has been created will appear in the following list. You "Edit" and "Delete" the Custom rate that has been created.
   

This is an explanation of how to manage the arrangement of salary components and rates. Then you can learn how to run payroll, here.