Payroll Fringe Benefits

Fringe Benefits are used for Non-monetary income and should be selected if the income is not actually money.  The income will not be included in net pay but will be added to gross pay.  You can use Fringe Benefit to setup Imputed Income for Life Insurance for example.

To setup a fringe benefit, open the Earnings Types from and create a new Type selecting Fringe Benefit from the Calculation Type combo box.

In the Employee form, click on Earnings tab and add the fringe benefit.

Notice there are taxes assigned to this earning but the employee does not actually receive the 100.00.  They are taxed on the 100.00 as if they earned it even though they did not.

When you create a paycheck the CAR fringe benefit of 100.00 is added to the Gross Pay but not the Net Pay.  When using a fringe benefit earning, the employee does not actually receive any of that money.  Instead it is added to their gross and they pay the taxes on that amount which lowers their Net Pay.

The CAR fringe benefit of 100.00 is added to the Gross Pay but you do not actually get the money added to your Net.  Instead that 100.00 is taxed like normal earnings, which does reduce your net pay by the taxes.

Here is how the paycheck report would look like.

If you change the CAR fringe benefit from 100.00 to 0.00, it drops the gross by 100.00 and the Net increases because you do not have to pay the tax on the 100.00.

Here is how the paycheck report would look like.