Taxable Payroll Benefits


how to add taxable payroll benefits to Goldenseal payroll software.
How to base a tax or benefit on other than the gross wages.
How to exclude a benefit or tax from deduction calculation of other tax items.

NOTE-- These are just three different ways to describe the same issue for our construction payroll software!


In each Tax Item or Benefit Item, the Based On and Subtract From fields determine the order of calculation.

Based On determines the base amount for this item.

Subtract From determines when this item is subtracted from gross wages (if ever), or added if it's a wage or contribution to employee That also determines the based on amounts for other benefits or Tax Items, that might need to have the gross amount adjusted for their calculations.


Users will need to set up the Based On and Subtract From fields so it calculates correctly. It may take some thought to figure out, but it only needs to be done once.

Check the steps below to understand the logic.

Note that after entering hours, it's easy to check to make sure it's using the correct logic. Choose Write Payroll, and double-click on the Deduction column for an employee. Check the Base Wages column- it should be the correct base amount for that item.

Here is how Goldenseal calculates payroll:
1. It starts with the gross wages. It uses that as the base amount for any Tax/Benefit Items that have Gross Wages in the Based On field.
2. It subtracts any taxes/benefits that have Gross Wages in the Subtract From field.
3. It next calculates any taxes that have Adjusted-Step one in Based On.
4. Then it subtracts any items that have Adjusted-Step One in Subtract From.
5. Repeat steps 3 and 4 for each of the remaining adjustments (we do 5 loops in all, which should be enough for even the most complicate of payroll setups).
6. Finally it uses the result as the base amount for any taxes or benefits that use the 'net amount' for a based on value.


Entered 2/14/01 by Casey. Updated 11/12/2010.