JAMAICA S MINIMUM WAGE INCREASES

Transcription

1 TH IPS NEWSLETTER MARCH 2016 Volume 5 / Issue 2 Payroll Matters JAMAICA S MINIMUM WAGE INCREASES According to the Jamaica Gleaner, effective March 1, 2016, the minimum wage in Jamaica will increase to $6, per week. This *1 moves the minimum wage up by $ as it was previously $5, For a 40 hour work week the new In this issue... Jamaica s Minimum Wage Increases PAYE No More! Antigua Eradicates Personal Income Tax Reminder FILE YOUR ANNUAL RETURNS! The deadline for filing your annual returns is fast approaching. Please remember to file before March 31 st. minimum hourly rate is $ , up from $ The January 2014 newsletter contains instructions on how to do a global rate change to increase the minimum wage rate. Visit readonline?pdf=january_2014.pdf to view the article. *1 Breaking the Code: General Ledger, Occupation and Grade Code An in depth look at how these codes can be Creating an ACH Bank for your Company A detailed guide on how to configure your payroll company to Jamaica s minimum A guide as to how to wage has increased remove PAYE for all to $6, per applicable employees. configured to suit the use one of the many PAYROLL MATTERS week Interactive Payroll Solutions Limited Vol. 5 Issue 2 user s preference banks in the ACH

2 PAYE NO MORE! ANTIGUA ERADICATES PERSONAL INCOME TAX According to the Daily Observer in Antigua, effective April 2016, personal income tax will be abolished in its entirety. This means that employees in Antigua will no longer have to pay PAYE. The Observer also stated that while Personal Income Tax will be removed, other payroll taxes will be increased, namely Social Security and Medical Benefits. There is no information on the increase in Medical Benefits, but Social Security will be increased by 2% sometime later this year. Social Security is expected to increase annually until both employee and employer portions combined add up to 15%. To effect the Personal Income Tax removal in IPS is pretty simple, just follow the instructions below: 1. Go to option 1-1 : File Maintenance -> Employee Master File 2. Change the employee s Tax Code from P - PAYE to N - No Income Tax 3. Save the changes. Please feel free to contact us if there are any issues with making these adjustments. PAYROLL MATTERS 2016 Interactive Payroll Solutions Limited Vol. 5 Issue 2 2

3 Breaking the Code: General Ledger, Occupation and Grade Code General Ledgers are used to keep track of all the accounts for recording transactions relating to a company s assets. To create, modify or delete a general ledger code, go to option 1-7-8: File Maintenance->System Codes-> General Ledger Codes. The following table describes in detail each field on the General Ledger Code screen: Field General Ledger Account Number General Ledger Description Account Type Current Period s Amount Year-to-Date Amount Requirement Used to uniquely identify a general ledger account. This gives detailed information about the general ledger account, allowing for correct identification. Allows you to select what action you would like to perform on the general ledger account, whether you should debit the account or credit the account. This field is populated automatically once the payroll is updated. It stores the amount allocated to that account for that current period. This field is populated automatically once the payroll is updated. It stores the amount allocated to that account for all pay periods to date. Once the general ledger code is configured correctly, you can assign them to the various transaction, deduction, loan, allowance, health scheme, pension plan, department and occupation codes as relevant to your company. You can also assign it to individual employees based on where their individual salary, transaction, deduction, allowance or loan should be posted. PAYROLL MATTERS 2016 Interactive Payroll Solutions Limited Vol. 5 Issue 2 3

4 Occupations are used to identify an employee s job description. To create, modify or delete an occupation code, go to option 1-7-9: File Maintenance->System Codes-> Occupation Codes. The following table describes in detail each field on the Occupation Code screen: Field Occupation Code Description G/L Account Requirement Usually four (4) characters in length and is used to uniquely identify an occupation. This gives detailed information about the occupation, allowing for correct identification This allows you to select what General Ledger Account your occupation will be a part of. Once the occupation code is configured correctly, you can proceed to the employee master file, option 1-1: File Maintenance-> Employee Master File, where you can assign an occupation to one or several employees under the Company Data tab. PAYROLL MATTERS 2016 Interactive Payroll Solutions Limited Vol. 5 Issue 2 4

5 Grades are used to identify an employee s rank in an organization. To create, modify or delete a grade code, go to option 1-7-A: File Maintenance->System Codes-> Grade Codes. The following table describes in detail each field on the Grade Code screen: Field Grade Code Description Requirement Usually four (4) characters in length and is used to uniquely identify a grade. This gives detailed information about the grade, allowing for correct identification. Once the grade code is configured correctly, you can proceed to the employee master file, option 1-1: File Maintenance-> Employee Master File, where you can assign a grade to one or several employees under the Company Data tab. We hope that this article has proven to be helpful. Please, do not hesitate to call us for further assistance. PAYROLL MATTERS 2016 Interactive Payroll Solutions Limited Vol. 5 Issue 2 5

6 CREATING AN ACH BANK FOR YOUR COMPANY ACH (Automated Clearance House) is a protocol that has been established to facilitate the electronic clearing of payment items among banks operating in Jamaica on behalf of their customers. For example, a company with an NCB bank account can transfer payment in the form of salaries or wages directly to an employee s BNS account. As of 2013, the ACH now handles cheques, direct debits and direct deposits. Initially, the hold period for all banks was reduced and synchronized with a three-day recourse period. As a result, bank customers now receive funds within three (3) business days of a cheque deposit instead of the previous five (5) to seven (7) days. Most of the Commercial Banks in Jamaica make up the ACH group. In IPS, we currently facilitate the following banks: First Global Bank, Bank of Nova Scotia, National Commercial Bank, First Caribbean International Bank, Sagicor Bank and Citibank. In order to successfully make direct lodgments into an employee s bank account, you will need to do the following: 1. Ensure that your employer s bank is a member of the ACH group 2. Contact the bank and request permission to perform ACH uploads After signing up, you will receive an ACH name and number to use in IPS. If your employer s bank is not under the ACH group in IPS, you are required to: a. Get the bank s ACH upload file format b. Contact IPS, we will analyze it and create a similar format in our software PAYROLL MATTERS 2016 Interactive Payroll Solutions Limited Vol. 5 Issue 2 6

7 To set up your company s ACH details in IPS, go to Tools (7) -> Options -> Advanced. You will need the following: The Company s bank this is the bank that your employer banks with ACH Name this is the name assigned to the company after being authorized to perform ACH uploads Account Number this is the bank account number for your employer s bank ACH ID - this is the ID assigned to the company after being authorized to perform ACH uploads ABA Number - this is the routing number of your employer s bank branch (Not applicable to all banks) Once the company is now registered to perform ACH uploads and the relevant details are inserted into IPS, you can now create your upload file. This file can then be sent to your company s bank for disbursement of direct lodgments to your employees bank accounts. To access the ACH file relevant to your company s bank in IPS, go to option as depicted in the image below. PAYROLL MATTERS 2016 Interactive Payroll Solutions Limited Vol. 5 Issue 2 7

8 By clicking Create [Bank Name] ACH File, IPS will automatically create the file with all the employee s bank details. And presto! You re done! That wasn t so much of a hassle now was it? That s all for now; tune in next quarter for another exciting newsletter. Suite 21, Seymour Park 2 Seymour Avenue, Kingston 10, Jamaica W.I. (876) or (876) media_team@ipsjm.com PAYROLL MATTERS 2016 Interactive Payroll Solutions Limited Vol. 5 Issue 2 8