Payroll settings hold the choices that differ from one company to another: how tax is withheld, when contributions are deducted, how lates are counted and more. The defaults follow DOLE and BIR rules, so change only what your company does differently.
Before you start
- Only an Owner / Management user (or your accounting firm) can change payroll settings. Everyone else sees them read-only.
- The same card holds your BIR details and work place. See BIR details and your work place.
Change a setting
- Open Company setup and choose Payroll settings.
- Change what you need.
- Click Save payroll settings. You see "Payroll settings saved."
A change applies to payrolls you compute after saving. Approved payrolls don't change.
Work days and hours
- Days a year (daily rate factor): 313 days for a six-day week or 261 days for a five-day week. A pay group can have its own (see Pay groups and pay schedules).
- Hours in a regular work day: used for hourly rates.
Contributions
- SSS, PhilHealth and Pag-IBIG deduction: Every pay (split across the month) or Once a month.
- If once a month, on which pay: the first or the last pay of the month.
- SSS: when deducted, PhilHealth: when deducted, Pag-IBIG: when deducted: set one agency apart from the rest, or leave it on Same as above.
The amounts come from each agency's table in force.
Withholding tax
Choose the Withholding tax method:
- BIR table for the pay frequency (Annex E): the default, and what payslips are expected to follow.
- Year-to-date (annualized on the annual table), for variable pay: counts the pay earlier in the year, including a previous employer's BIR Form 2316.
- Month-to-date on the monthly table.
Either way, the last December payroll and a final pay annualize the year. See Year-end.
Lates
- Late grace period (minutes per day): DOLE doesn't require one; leave it at 0 if you give none.
- Late beyond the grace period: Deduct all minutes late or Deduct only minutes beyond the grace.
Holidays and official business
- Pay special days not worked (daily-paid): off means "no work, no pay" on special days.
- Exempt from regular holiday pay (Labor Code Art. 94): only for the small retail or service establishments the law exempts. Leave it off otherwise.
- Holiday pay for hourly-paid staff without a schedule and Official business days: how many hours these days are paid.
Checks before approval
- Flag pay above the 3-month average by (times): flags gross pay or overtime that jumps compared with the employee's recent pays.
- Review net pay changes of more than (%): used by the payroll audit and the variance review.
- Minimum net pay (₱): lower-priority deductions are carried forward when they would bring net pay below this.
Other settings
| Setting | What it does |
|---|---|
| Hold the pay of separating employees | Holds the last one or two cut-offs until the final pay. See Holding a salary. |
| Payslip PDF password | Birth date, employee number, or no password |
| Payslip emails | Emails each employee a link to their payslip when a payroll is approved. On some plans the switch is locked and says why. |
| Company loans and cash advances | The largest loan, the most one payroll may deduct, and one open loan per type |
| Pag-IBIG on de minimis above its limit | Whether the excess over a de minimis limit counts toward Pag-IBIG |
| 13th month pay basis | Extra pay to count in the 13th month basis; by law only basic pay counts |
| Payroll history up to | For pay dates up to this day, computed amounts of earlier payrolls rebuilt from your records can be edited by hand. Leave blank if none. |
Holding wages
Holding earned wages needs the employee's consent or a written company policy. Turn on Hold the pay of separating employees only if you have one.
What can go wrong
- "Days a year: 313 (six-day week) or 261 (five-day week)." Choose one of the two.
- "The net pay change to review must be a percentage from 1 to 100." Type a number in that range.
Good to know
- There is no rounding setting on this card: final amounts are rounded to the centavo.
- Each payroll keeps a copy of the statutory rates it used, so past payslips can be reproduced.