HumanManager Tax Computation Process

HumanManager Tax Computation Process

This Manual explains the Tax set-up process on HumanManager. Note: All amounts referenced for purpose of freepay, tax law and taxable income algorithm were assumed and do not represent the actual figures in your environment.

 Five steps to be covered are:

· Understanding the Tax Flow

· Defining your Taxable Income

· Setting up Freepay

· Tax Law Definition

· Putting it all together


· Staffs have been setup in HumanManager

· All Staff are in paygroups (Salary Groups)

· Staff payroll elements (Basic & Allowances) have been defined for each staff



1. Tax Elements:

The following would need to be considered when determining tax to be paid for a specific period.

a) Earnings subject to tax (Gross Taxable Income)

b) Freepay/Relief items

c) Net Taxable Items

d) A Tax Law/Graduated tax table


1.1 The Tax Flow

· (a)Gross Taxable Income – (b)Freepay = (c)Net Taxable

· Net Taxable (Subjected to (d)Tax law) = Tax due

Figure 1 (Tax calculation on HumanManager)

2.  Defining your Taxable Income

HumanManager allows the flexibility of defining what payroll elements contribute to your total taxable earning (Gross taxable). The “Define Taxable Income Algorithm” is a set of computation formula for arriving at the gross taxable income of an employee’s salary.

Navigation: (Foundation – System Administration – Setup – Payroll – ‘Define Taxable Income Algorithm’)

Figure 2 (Define Taxable Income Algorithm)


Field Name


Taxable Code

This is a unique code to identify a particular taxable calculation e.g. TAXIN. This field takes a maximum of 5 alphanumeric characters.


This is the full name by which you want a particular calculation to be called e.g. Taxable Payment.

Short Name

This is expected to be a short, easy to remember name that will serve as a header for this particular calculation during reporting e.g. Taxin

Tax Table Operand

Displays a complete dropdown list of all operands within HumanManager. Click on the required option from the list.

Tax Table Source

Clicking in this column presents you with a drop-down list of all possible choices in which your earlier selected operand can exist. For example if your selected tax table operand is ‘overtime,’ the tax table source will present to you all possible choices related to overtime, and you may select which one(s) you want to include in this particular calculation.


Here, you choose what operation you want performed on the amount represented by the tax table source you selected above. The available options are: +, -, x, and |.

Figure 3 (Tax Income Algorithm Definition)

Note: To add a new entry to the tax table choose an operator

3. Freepay Setup

3.1 Allowance Based

Allowances entitled to relief can be setup to reflect these provisions at their definition. In the example below the allowance can be setup to enjoy a relief of 30,000 (Thirty thousand) by picking either of the following against the amount.

· Higher amount (Tax 30,000)

· Higher Non Taxable Amount (Tax amounts above 30,000)


3.2 Calculation Table

The Calculation Table is used to generate variable figures for employees using the same parameters. Calculation operands can range from numeric figures, to components of allowances, deductions and loans, to number of children and other calculations. This can be used to compute your freepay.

Navigation: (Foundation – System Administration – Setup – Payroll – ‘Define Calculation Table’)

Figure 4 (Define Freepay- Calculation Table)

4.  Tax Law

HumanManager helps you define your tax laws. Included on the screen is the tax table to help you capture your tax details.

Navigation: (Foundation – System Administration – Setup – Payroll – ‘Define Tax Law’)

Figure 5 (Define Tax Law)

Field Name


Tax Code

This is a code which uniquely identifies a tax e.g. TAXT.

Tax Table Name

This is the actual identity or reference name of the tax table name for which you defined a code above: e.g. Tax Table 2005.

Default Amount

Any amount entered in this field is what the system will deduct as tax for employees whose Free pay details are not specified in the system.

Default Percentage

In place of a flat rate being paid as tax you can specify a percentage of salary to be deducted as tax in event that no Freepay is entered for a staff.

Exempt Amount

Enter the amount paid as tax by employees who are exempted from paying the normal tax rate.

Exempt Percentage

If the amount is not specified, enter the percentage paid as tax by employees who are exempted from paying the normal tax deduction.

Minimum Taxable Amount

You enter the minimum taxable amount (minimum wage) that can be taxed by the system.


Specify the amount OR


The percentages

Tax Table

Define here the table based on which taxable income will be derived.

Tax Figures Are

From the drop down select an option to indicate if your tax is computed annually and the figure spread through the month or if tax is computed monthly.

Click on the Update button to save entries.


5. Putting it all together

After completing the definitions for Taxable Allowances, Freepay (Calculation Table) and Tax Law, update the staff paygroup to reflect these settings.

(Foundation – System Administration – Setup – Payroll – ‘Define Paygroup’)

Navigate to the staff paygroups and update where relevant. Click on “Update” for each item when done. Select the top “Cancel” button to navigate back to the define paygroup screen. Click on the “Submit” button to save changes.

Figure 6 (Insert Taxable Income to Paygroup)

Figure 7 (Insert freepay to paygroup)

Figure 8 (Insert Tax Law to paygroup)

 *Remember to run draft before confirming results

    • Related Articles


      The following steps are provided to update HumanManager to accommodate the rules of the Pension Act 2014. A. CONTRIBUTORY PENSION MODULE HAS BEEN ACTIVATED              i. For Company Wide Update (i.e. Pension is setup as Company Wide): ...

            1. Open Command Prompt (CMD)       2. Enter command IMP and press Enter       3. Enter HumanManager database’s Username and Password       4. Enter N (No) for Import Data Only       5. Enter directory and filename for the import file. e.g. ...

            1. Open Command Prompt (CMD)       2. Enter command EXP and press Enter       3. Enter HumanManager database’s Username and Password       4. Press Enter to accept default buffer size       5. Specify directory and filename for the backup file. ...

      CONFIGURATION ON HUMANMANAGER GUI Ensure system email address is inputted for Non-Staff SYS Foundation > System Administration > Authorisation > Define Access Right for Non-Staff   Insert SMTP server’s IP Address in Global Processing Rule. Foundation ...
    • Performance Appraisal Module (Step by Step Approach)

      Performance Appraisal Module    Employee Selfservice Appraisal   Employees can appraise themselves and forward to their manager for review.   A. Keying In Key Performance Indicators (KPIs) Key in your KPIs (Key Performance Indicators): Kindly log ...