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Administrator Guide
Last Updated: 2026-05-15
Steps: Set Up Gross-Up Calculations

Steps: Set Up Gross-Up Calculations

Review setup considerations for gross-up calculations.
This topic provides instructions for setting up gross-up calculations for these payroll countries:
  • Canada
  • France
  • Ireland
  • The UK
  • The U.S.
You can configure Workday to calculate a gross amount for an earning, based on a defined net amount. You can use gross-up calculations to offset an employee's liability for taxes or contributions when you want to guarantee a given net amount. Examples: gift cards, bonuses.
You can calculate multiple gross-ups in a single pay calculation, including multiple inputs for the same gross-up earning. To ensure optimal performance, Workday limits the number of different gross-up earnings per worker to 4 for a payroll calculation. You can, however, have an unlimited number of net inputs for the same gross-up earning.
Workday retroactive pay doesn't recalculate gross-up earnings.
  1. Access the
    Maintain Payroll Gross-Up Configurations
     task.
    As you complete the task, consider:
    Option Description
    Gross-up tolerance
    Define an acceptable variation between input net amounts and calculated net amounts in gross-up calculations. Workday generates an error when the difference between the input and calculated net amounts is greater than the defined tolerance. By default, Workday provides a tolerance of 0.01.
    Apply additional cents to taxes
    For Payroll for Canada, select to reallocate any differences between the input and calculated net amount to a worker's withholding tax. Applies when input and calculated net amounts are different due to a gross-up tolerance.
    Workday allocates the additional amount to the first withholding tax on the payroll result, based on this order of priority:
    • Federal Income Tax (FIT) [CAN]
    • Province Income Tax (PIT) [CAN]
    • Province Income Tax (QC-PIT) [CAN]
    • Federal Income Tax (FIT T4A) [CAN]
    • Province Income Tax (PIT T4A) [CAN]
    • Province Income Tax (QC-PIT RL-2) [CAN]
    • Federal Income Tax T4A-RCA (FIT T4A-RCA) [CAN]
    • Province Income Tax T4A-RCA (PIT T4A-RCA) [CAN]
    • Federal Income Tax Non-Resident (FIT-NR) [CAN]
    For Payroll for the U.S., select to reallocate any differences between the input and calculated net amount to a worker's withholding tax. Applies when input and calculated net amounts are different due to a gross-up tolerance.
    Workday allocates the additional amount to the first withholding tax that the worker is eligible for, based on this order of priority:
    • Federal
    • State Work
    • State Home
    Gross-Up Priorities
    Determines the order in which Workday calculates earnings with gross-up calculations. When you select
    Always Gross-Up
     on an earning, Workday automatically adds the earning to the
    Gross-Up Priorities
     section. Workday recommends that you verify the priority order of the earnings in this section after creating gross-up earnings.
    Workday only displays earnings based on the selected country.
    Security:
    Set Up: Payroll (Calculations - Payroll Specific)
     domain in the Core Payroll functional area.
  2. Add earnings or deductions to pay component groups using the
    Create Earnings
     or
    Create Deductions
     task. See Reference: Common Pay Component Groups.
    For Payroll for France, add statutory taxes that are deductible from tax to the
    FRA Statutory Taxes EE - Deductible from Tax - Excluded from Gross Up
     pay component group. Workday excludes these taxes from the gross-up calculation.
  4. Enter the net amount for the gross-up earning.
After a payroll calculation, Workday displays
Yes
 in a
Grossed Up
 column on the worker's payroll results for grossed up earnings.