payroll

Eliminating Payroll Data Errors
Webinar: How PCC can aid you in eliminating Payroll data errors
Webinar: How PCC can aid you in eliminating Payroll data errors 1024 536 SpinifexIT

Mark your calendars for SpinifexIT’s upcoming webinar on Eliminating Payroll Data Errors on April 9 at 2pm EST. 

Learn how you can fix payroll data mistakes quickly and easily – and save time, effort and money along the way.

Find out how you can overcome critical payroll challenges and how to use payroll automation to improve your workflow. Get to learn more about SpinifexIT’s payroll solutions and our Payroll Control Center (PCC) Integrated Solution.

SpinifexIT’s PCC-integrated solution lets you ensure your payroll data is airtight and error-free. With PCC, you can validate and reconcile your company’s payroll results and support your payroll processes better.

Sign up to join this exciting discussion!

The webinar will be led by expert Leeanna Stetler, Solutions Engineer at SpinifexIT.

Find out how you can overcome critical payroll challenges and how to use payroll automation to improve your workflow. You’ll also learn about SpinifexIT’s payroll solution, Payroll Control Center (PCC) Integrated Solution

PCC is SpinifexIT’s software solution that lets you ensure your payroll data is airtight and error-free. With PCC, you can validate and reconcile your company’s payroll results and support your processes.

Find out more about PCC here.

About the Speaker

Leeanna Stetler

Leeanna is a Solutions Engineer for the North American division of SpinifexIT. 

Webinar details

Eliminating Payroll Data Errors by Leeanna Stetler | April 9, 2020 2pm EST

SpinifexIT Happy new year it is
Happy New Year! Or Is It…
Happy New Year! Or Is It… 1024 512 SpinifexIT

It’s a familiar refrain in payroll departments across North America — year-end payroll processing is just no fun! So why does it have to be so difficult?  In this article, we will explore the common headaches, and how to nip them in the bud – targeting those organizations that run SAP payroll systems.

To start the conversation, I will first provide some pointers regarding wage type configuration.  If you create new wage types during the year and then do not realize until year-end that you did not configure the taxation correctly, well that can be a big problem.  Or perhaps it’s not a new wage type that’s the issue, but existing ones because a tax authority has changed regulations and you needed to change your configuration accordingly…but failed to do so.  

The second item concerns issues with your Tax Calculations – those scenarios where taxes are not computing correctly, and you end up with out-of-balance cases or taxes stopping at the wrong ceilings.  These are all things that you want to catch during the year, right away, not at year-end.

The third topic we will discuss is Employee Master Data – for example, ensuring new employees have supplied valid social security or social insurance numbers, or that employees who moved during the year have gone through the appropriate steps to have their addresses updated.

And finally, those year-end manual adjustments; items like noncash benefits that need added to employee YTD taxable amounts, either using infotype 221 or maybe just by making entries directly into SAP’s US Tax Reporter module.

So now let’s take a deeper dive into each of those areas.  

Wage Type Configuration

Whoever in your organization that is responsible for creating wage types – which might be you – is no doubt very familiar with table T512W.  Cumulations, evaluation classes, and processing classes are all a part of that configuration – and I have listed below for you the processing classes that have an impact on how wage types are taxed (in the US) plus a couple of cumulation classes to be aware of. So, at a minimum, I would suggest your wage type configuration script include these items.

    • PC 64 Alternate Formula indicator
    • PC 65 415 limit category
    • PC 67 Work Tax Proration
    • PC 68 Payment type for tax calculation
    • PC 69 Taxable/nontaxable contribution
    • PC 70 Work Tax Proration (salaried)
    • PC 71 Wage Type Tax Classification (This one is critical)
    • Cumulation /102 (401k wages)
    • Cumulation /114 BSI Base Wages

For Canadian payrolls, the specifics are a little different; below are the tax-related wage type configuration items I suggest staying on top of:

    • PC 52 Cumulation into gross WTs for Workers Compensation
    • PC 65 Definition of Earnings subject to Health Tax
    • PC 69 Definition of Workers Compensation assessable earnings
    • PC 72 Derivation of GST and other sales tax for income tax
    • PC 84 Definition of PPIP Insurable Earnings
    • Taxable Wage Cumulation WTs:  /102, /103, 104, 105, /112, /113, /118, /119, /120, /121, /122, /130, /131, /132, /140, /141, /142, /152, /153, /154, /158, /160, /161, /162, /163, /164,

I would also propose that whatever mechanism you use to request a configuration transport be moved through the landscape, that it require the attachment of a test matrix.  Even well-qualified super users doing the config should be required to test their changes before implementing into production.

Along with that, I recommend some sort of signature approval be required.  This may mean something different to you as compared to other organizations, depending on how your SAP support teams are structured, but there should be some individual required to review and provide signoff.

Finally – perform regression testing for any changes made – do not fall into the trap of just testing for the expected changes.  And when I say regression testing, here is what I mean:  Run your payroll process prior to the change, followed by a report with the pertinent results, then apply the changes; followed by repeating the process so you can compare before and after results.  And make sure your regression test population – if not a full employee population – contains a good cross-section of different employee types, work schedules, and tax authorities.

For my final recommendation regarding wage type configuration – we all understand that sometimes you need to adjust configuration due to outside forces – like a tax authority creating a new regulation regarding certain types of employee payments.  To keep on top of any changes like that which could affect your configuration, here are a few suggestions:

  1. Maintain a membership in organizations such as the American Payroll Association or the similar Canada Payroll Association.  That will give you access to website announcements regarding tax reg changes, plus the opportunity to attend both local and national chapter conferences.
  2. Another way to keep up is to subscribe to any mailing lists deployed by various tax authorities, which will allow you to have information pushed out to you instead of needing to remember to go check for updated info all on your own.
  3. And last — periodically reviewing your configuration in the system is always a good idea.  Reviewing your SAP US Tax Model configuration (tables T5ute/y/m) in addition to the wage type configuration I mentioned above, just every so often, is a good idea to make sure nothing has slipped by you.

Tax Calculations

In this area, there are a few periodic audits I would suggest doing, throughout the year, starting with a review of your Social Security, Medicare, FUTA & SUTA tax results (for the US) and the Canadian counterparts of CPP/QPP/EI/QPIP/PPIP.  For instance, compare the Employee Withholding and Employer match amounts to see if they are in sync; plus perform tests to determine if the actual tax amounts recorded equal the taxable wages multiplied by their respective rates.

In addition to these checks, don’t forget to verify the accurate calculation of the additional US Medicare surtax for those people earning over $200K per year, and confirm that all taxes with ceilings (e.g. CPP/QPP/EI, US Social Security, US FUTA/SUTA) are stopping at the appropriate maximums for the year.

And finally – there are two tables that are maintained in SAP regarding US State Unemployment rates and ceilings – those being tables BTXRATE and T5UTX, plus the same data is entered directly into the BSI software application.  You will want to make sure and verify that the values in all those places are in sync with each other.  From a Canadian perspective, constants used in the tax calculations are stored in tables T511K and T5KTC (as updated every year by SAP via HRSPs) – be sure to confirm your system has been updated timely every year.

Some more best practices to head off tax calculation issues are  – if you use SAP’s Tax Reporter module for generating US forms such as W2’s, 941’s, and Unemployment reports you should be generating test runs for these forms, on a monthly or quarterly basis, and when you do, always check the log that is produced for any errors or warning messages. I also suggest you periodically perform “three way” reconciliations between Tax Reporter, general ledger postings, and payroll cluster results.  

In a similar manner, you can run the Canadian T4 program, RPCYERK0, multiple times during the year in ‘test’ mode, confirming results and watching for error messages and employee rejections.  

Employee Master Data

Moving to Employee Master Data, let’s cover some of the best practices you should be following as you perform some audits.

First off, audit those employees claiming tax exemption – perhaps even contacting those employees to verify the data is correct

Next, I would suggest auditing resident, work, and unemployment tax authorities – info types 207, 208 and 209 for the US, and info types 461, 462, 463, 464 for Canada – in a few different ways:

  1. Compared to the employee’s address (SAP info type 6)
  2. Compared to other system data that might indicate location, like perhaps personnel area or cost center
  3. Compare the values across the info types to each other – obviously there are legitimate reasons as to why for some organizations they do not have to agree – but know what would make sense for your employee population and look for that.

And finally – audit the SSN/SIN’s found on info type 2, to make sure all employees have valid numbers.

Taking it a step further – extend your audit process to include contacting your employees to have them validate the data you have on them, such as SSN/SIN, addresses, tax exempt statuses. And of course, include in your notifications the instructions for getting any incorrect data corrected – and if employees can correct it themselves via an ESS portal, all the better!

Manual Adjustments

The last topic mentioned in our opening discussion was Manual Adjustments.  I have a few best practices to share, starting with…. JUST DON’T DO THEM 😊

But since that’s probably not feasible…..do incorporate as many adjustments you can into your regular payrolls to minimize the number of off-cycles that are necessary, and reconcile the info type 221’s that get created versus the ones picked up and actually processed in payroll – make sure there aren’t any yearend adjustments entered but not pushed all the way through.

As much as possible, I strongly recommend you work with your stake holders to limit the need for these adjustments – good luck with that, right?  But if you can convince the business units to adopt practices that are payroll process friendly, it will relieve some of the headache for you.

Here’s one example of a business practice you can influence – consider using fiscal year cutoffs rather than calendar years when possible, to alleviate having all the work come down at year end.  For example, I used to work at a company where the employees all had the use of a company vehicle. Those employees had to log any personal use of the car and provide that data to us annually so that an imputed value could be computed and added to their payroll results.  Company policy set the year for those accumulations to be Dec 1 through Nov 30 – giving the payroll department time to record the adjustments during December, instead of a last-minute rush in January.

And finally, if you use US Tax Reporter, you know there is an option to directly enter in adjustments, via manual table entries, forcing adjustments onto the forms – like W2’s – without ever flowing through either master data or payroll calculation.  It’s a great tool and has its uses – but I would suggest doing so sparingly and keep your documentation to justify the entries made and provide an audit trail.

So where does SpinifexIT come in?

Now that we have walked through some of the biggest yearend challenges and offered up some suggestions for meeting those challenges, I of course want to introduce you to a Spinifex product that was built to handle these issues very efficiently.  That product is called Easy Balance and we have both a US and a Canadian version.  


Easy Balance is basically a suite of reports specifically geared towards payroll tax audits and validations.

For example, Easy Balance includes reports that audit for undesired negative results, like for instance in tax amounts, which will result in an error when running your W2’s or T4’s.  Easy Balance reports deliver results at a high level as well as including the ability to drill down into specific numbers, to easily locate what exactly is creating an issue. Other functionality delivered by EB allows you to validate the configuration of your wage types, in terms of how their taxability has been set up, addressing those wage type concerns mentioned earlier in this discussion.

Easy Balance Functions can be categorized under these four major topics –

  1. Validation of tax-related configuration
  2. Pre-delivered exception reports – for example, whose fica wage, multiplied by .062, does NOT equal the tax withheld?  Or, for Canada, employees whose province for health tax purposes does not agree with their province of employment.
  3. Reconciliation between US Tax Reporter, Payroll results, and even the General Ledger postings
  4. Correspondence, like the Address/SSN verification just mentioned, as well as documents explaining US W2 results to the employees

Regardless of your reporting tool of choice, the suggestions we have mentioned today – as implemented at check points all throughout the year – will hopefully ease some of the year-end stress experienced by your payroll department.  And if you would like to utilize a reporting tool built especially for these needs, my final recommendation is that you check out Easy Balance!

Your SpinifexIT representative will be happy to demonstrate the features of the product as part of a no-cost demonstration, so that you can see for yourself what we can do to help you have a “Happy New Year”.


SAP payroll cloud document generation Spinifexit
Webinar: A Taste Of The Cloud Featuring Strato by SpinifexIT | November 29, 2018
Webinar: A Taste Of The Cloud Featuring Strato by SpinifexIT | November 29, 2018 1024 512 SpinifexIT

Discover how SpinifexIT solutions can help On-Premise SAP Customers prepare to move to SuccessFactors and improve their day to day communications and overall employee satisfaction while enabling an easier transition to the cloud.

This webinar will be hosted by Stephen Gallo, our Product Architect from SpinifexIT North America. Stephen will give a brief description and demonstration of our cloud-based on-demand document generation solution, Strato. Strato is built for both on-premise and cloud environments and offers a seamless user experience for users who are using both or either environment.

This webinar is highly recommended for: 

  • Organizations who are using SAP HCM on-premise and are looking for ways to improve their document distribution and employee communication processes
  • Organizations using both SuccessFactors Employee Central but still with On-Premise Payroll (hybrid) who are looking for ways to easily bridge the gap between their cloud and on-premise solutions by being able to generate data from both sources without the need for external downloads, manual efforts, third-party software, or interface files.
  • Organizations who are looking for solutions to help them create and automate the distribution of key employee documents like Letters of Employment, Claims, and Total Compensation Statements
  • SuccessFactors customers who are looking for a robust document generation solution that can easily combine data from across multiple SF modules, including ECP (Payroll)

This webinar is FREE for everyone.

Click here to register and reserve your slot.

Event Details

Date: Thursday, November 29, 2018

Time: 2:00 PM – 3:00 PM EST

Hosts: Kris Burke & Stephen Gallo

SpinifexIT blog single touch SAP payroll is here
Single Touch Payroll is Nearly Here for SAP Payroll
Single Touch Payroll is Nearly Here for SAP Payroll 1024 512 SpinifexIT

After attending the latest SAP Single Touch Payroll (STP) update session this week and also after using the pilot STP solution, I thought I would write up some detail on what I think of it.

What is Single Touch Payroll?

Single Touch Payroll is a new initiative by the ATO to effectively replace the Year-End Payment Summary process with a new process that reports payments on a per pay period basis.

Single Touch Payroll requirements

This means that there needs to be an STP transmission file containing all of the employees’ pay details created per pay period. This file is then transmitted to the ATO using a Secure Transmission. For this part, SAP are proposing to use their SAP Cloud Integration solution.

STP was set to go live on 1st July 2018 for organisations with more than 20 employees, however, SAP have obtained an exemption for their existing SAP Payroll customers until the 31st of May 2019 – which is roughly 8 months away.

SAP STP Design

After working with SAP Payment Summaries for over 20 years, I was very interested in what is new with Single Touch Payroll and what the impact for existing customers would be to transition to this. I was initially wondering if this would be a large transition for existing customers, or a large implementation.

Luckily the STP solution seems to have been designed with this in mind.  For an existing customer already configured and using Payment Summaries, the transition work should be minimal. There are a few key differences however and these are important to consider during an implementation

Configuration

  • Wagetype Configuration.  STP, like Payment Summaries, requires you to nominate the specific wagetypes that are to be reported during the STP. Previously, for Payment Summaries, this used an Evaluation Class 11 to identify these wagetypes. Using a similar approach, STP will use a new Evaluation Class 13.  The wagetypes must also be culminating to the CRT (Year to Date table) in SAP. These wagetypes need to be reviewed and set up correctly before running the new STP process.
  • ABN Details.  SAP have kept the same approach as the Payment Summary solution here and have reused the same table (T5QGP) to hold the ABN details for the company.  Some additional fields have been including Intermediary Details. We would suggest reviewing all of your ABN details as part of the transition to STP.
  • STP Transmission Settings.  New settings have been added for the transmission side of STP.  These are held in the table view (V_T50BK). Items such as the Auskey ABN, BMS identifier and ports for the transmission need to be setup here.
  • Payroll Schemas. STP will now be calculated during the payroll processing and the results will be stored in new Payroll Cluster tables:

SABN – Holds the ABN Details when running the payroll

ACRT – Holds the Year to Date values at ABN level

AETP – Holds any ETP Payments calculated Year to Date

STP Processing

The wagetypes to be used during the STP processing are stored during the payroll process. This updates the SABN, ACRT and AETP tables.

Single Touch Payroll

Source: SAP Payroll Webinar by Vikas Pandey

After the payroll process, there are a few additional steps:

  • Generate Reporting Data – This transaction (PC00_M13_STP_GEN) is used to generate the data that is used to create the transmission file to the ATO.  This will read the SABN, ACRT and AETP tables and then create both a company and Employee files containing the information summarised and ready to be transmitted to the ATO.  This report allows you to view the Employer, Employee, Allowance details and any error messages that are generated during the STP run. The following tables are updated by this process:
  1. T5Q_STP_ER – Employer Details
  2. T5Q_STP_EE – Employee Details
  3. T5Q_STP_PAY – Allowance Details
  • STP Declaration and Submission – This transaction (PC00_M13_STP_VIEW) allows you to select the run from the above step, view the details going into the STP run and create the Declaration that these values are correct.  This Declaration needs to be completed before proceeding to transmitting the data and is a required step by the ATO.
  • Transmission to the ATO – The final step is the Business to Authority transmission (Transaction PB2A).  This is where you will transmit the STP data to the Tax Authority using the SCI (SAP Cloud Integration) solution.  It not only allows for transmission, but also receives any errors back from the ATO after the file has been validated.
Single Touch Payroll

Summary

In summary, the SAP STP solution is not far away.

 With a planned release date of October 11th, now is the time for customers to start to plan for the solution’s upgrade and implementation. Whilst you do have the option to defer until the 31st of May 2019, we would not recommend waiting too long as there is still a lot of work to do.

I will follow up this blog with a further overview of the System Requirements, Configuration, some considerations when upgrading. I will also talk about SpinifexIT’s newest solution, Easy STP, and how it enhances the usability of the standard SAP STP solution.

Single Touch Payroll


#ComeSeeSpinifexIT

Are you a SpinifexIT Customer who would like to learn more about our Easy STP solution first hand? If so, I’m inviting you to join our Customer Days scheduled across October and November. You may click here to view the schedules and agenda. Customer Days are FREE events for SpinifexIT Customers. Visit the link now and register to reserve your spot if you haven’t yet.


SpinifexIT free webinar payroll reporting
Webinar – What Are The Best Practices In Employee Central Payroll Reporting
Webinar – What Are The Best Practices In Employee Central Payroll Reporting 1024 533 SpinifexIT

Register here: https://attendee.gotowebinar.com/register/6283535621290422531

Are you struggling when implementing Employee Central Payroll?

Learn how customers are using the SpinifexIT suite of products to address implementation and post go-live reporting requirements.

We’re inviting you to our webinar on June 22. This session will showcase the relevance of SpinifexIT products in an Employee Central Payroll environment, and especially addresses the considerations to be aware of as you plan your implementation.

In this webinar, you will

  • View a checklist of topics to consider upon making the decision to implement ECP
  • See how the SpinifexIT rapid implementation tool enhances SAP’s Payroll Control Center
  • View live demonstrations of SpinifexIT tools reporting on ‘cloud’ data

Register here: https://attendee.gotowebinar.com/register/6283535621290422531