{"id":5243,"date":"2023-08-14T18:32:06","date_gmt":"2023-08-14T18:32:06","guid":{"rendered":"https:\/\/techlify.com\/techlifyhr\/?p=5243"},"modified":"2025-10-31T18:43:26","modified_gmt":"2025-10-31T18:43:26","slug":"pro-rated-statutory-deduction","status":"publish","type":"post","link":"https:\/\/techlify.com\/techlifyhr\/payroll\/pro-rated-statutory-deduction\/","title":{"rendered":"Prorated Statutory Deduction"},"content":{"rendered":"\n<p>Statutory Deductions are the mandatory payments, deductions, and\/or contributions required by law in respect of employees&#8217; salary and other employment benefits. TechlifyHR now introduces a workflow to prorate statutory deductions for employees that either join during the pay period or leave during the pay period. This feature can be enabled from the Administration Module as seen in the image below:<\/p>\n\n\n\n<figure class=\"wp-block-image\"><picture><source srcset=\"https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image.webp 3164w,https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image-300x137.webp 300w,https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image-1024x469.webp 1024w,https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image-768x351.webp 768w,https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image-1536x703.webp 1536w,https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image-2048x937.webp 2048w\" sizes=\"(max-width: 3164px) 100vw, 3164px\" type=\"image\/webp\"><img src=\"https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image.png\" height=\"1448\" width=\"3164\" srcset=\"https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image.png 3164w, https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image-300x137.png 300w, https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image-1024x469.png 1024w, https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image-768x351.png 768w, https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image-1536x703.png 1536w, https:\/\/techlify.com\/techlifyhr\/wp-content\/uploads\/2023\/08\/Image-2048x937.png 2048w\" sizes=\"(max-width: 3164px) 100vw, 3164px\" class=\"wp-image-5388 sp-no-webp\" alt=\"\" fetchpriority=\"high\" decoding=\"async\"  > <\/picture><\/figure>\n\n\n\n<p>Below are a few scenarios in which an employee&#8217;s salary would need to be prorated. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"Pro-Rated-Statutory-Deduction\">The Problem<\/h2>\n\n\n\n<p>Currently, in TechlifyHR, an employee is given their full (85,000 or 1\/3) statutory deduction, regardless of whether they worked the full month or part of the month. <\/p>\n\n\n\n<p>However, if an employee with a 150,000 salary worked 1\/2 month (August 1-15) at Company A and 1\/2 month (August 16-31) at Company B, then with the method above, the employee would receive an 85,000 statutory deduction from both companies, resulting in a total of 170,000 statutory deductions, paying $0 in PAYE for the month of August, which is incorrect. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"Pro-Rated-Statutory-Deduction\">Scenario 1: Jane Joined in the middle of August<\/h2>\n\n\n\n<p>Jane joined on the 12th of August, 2023 on a monthly salary of $130,000. For August, Jane&#8217;s gross income would be $84,000<\/p>\n\n\n\n<p><strong>Previously<\/strong><\/p>\n\n\n\n<p>Jane would&#8217;ve had a full statutory deduction of $85,000. <\/p>\n\n\n\n<p><strong>NEW: With Prorated Statutory Deduction<\/strong><\/p>\n\n\n\n<p>Jane&#8217;s prorated statutory deduction is now $51,850<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"Pro-Rated-Statutory-Deduction\">Scenario 2: John Left in the middle of April<\/h2>\n\n\n\n<p>John left Company T on August 11th, 2023, he was earning a monthly salary of $100,000. John then joined Company C on the 14th of August, 2023 on a monthly salary of $100,000. His gross income for August would be $106,153 ($41,538 from Company T and $64,615 from Company C).<\/p>\n\n\n\n<p><strong>Previously<\/strong><\/p>\n\n\n\n<p>John would&#8217;ve had a full statutory deduction of $85,000. <\/p>\n\n\n\n<p><strong>NEW: With Prorated Statutory Deduction<\/strong><\/p>\n\n\n\n<p>John&#8217;s prorated statutory deduction is now $33,150 at Company T and $51,850 at Company C which totals up to $85,000 since John worked for the entire month of August.<\/p>\n\r\n ","protected":false},"excerpt":{"rendered":"<p>Statutory Deductions are the mandatory payments, deductions, and\/or contributions required by law in respect of employees&#8217; salary and other employment benefits. TechlifyHR now introduces a workflow to prorate statutory deductions for employees that either join during the pay period or leave during the pay period. This feature can be enabled from the Administration Module as [&hellip;]<\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","inline_featured_image":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_joinchat":[],"footnotes":""},"categories":[17],"tags":[],"class_list":["post-5243","post","type-post","status-publish","format-standard","hentry","category-payroll"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Prorated Statutory Deduction - TechlifyHR<\/title>\n<meta name=\"description\" content=\"Learn how TechlifyHR handles pro-rated payroll deductions to meet local compliance with ease.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/techlify.com\/techlifyhr\/payroll\/pro-rated-statutory-deduction\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Prorated Statutory Deduction - 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