Background

A payroll deduction is an amount of money that is withheld from an employee’s paycheck in order to make a payment to a third party. Examples could be taxes, insurance premiums, 401k savings, loan repayments, wage garnishments, and employee purchases.  For a full definition, see Deductions in our Payroll Glossary.  For further reading about using payroll deductions, see our blog article An Overview of Payroll Deductions.

A deduction is different than a contribution.  In Patriot Software, a contribution is a company-paid amount that appears for informational purposes only and does not affect the paycheck.  See Company-Level Contributions in Patriot Software.

To manage company-level deductions in the Payroll Software:

Before you can set up specific deductions for individual employees, you must first set up the deductions under the Company level.

Settings > Payroll Settings > Deductions & Contributions

To add a new deduction:

• Click the “Add New” link under the Deductions section.
  
• A set of blank fields will appear. For detailed field information, see Company-Level Deduction Set-up:  Field-Level Help.
  
• Once you set up the deduction at the company level, you are now ready to assign it to your employees.  See Employee-Level Deductions.
  

To edit a deduction:

• Click the “Edit” icon in the row. You can now make changes in the appropriate fields for that deduction. Note: if a deduction has been used in a payroll, the Deduction Type and Method cannot be changed. All other fields may still be edited.
  
• Click Save.  If the field you edited is a company default field used on an employee’s record, the employee’s deduction will be automatically updated.
  

To delete a new deduction:

• Click on the “Delete” icon in the row.  You may only delete a deduction if it has not yet been used in a payroll. If the deduction has been used in a payroll, the delete icon will not be visible.
  
• Click either Yes or No.