Concept: Adjust Prior Period Payments

Prior Period Adjustments

For Payroll for Canada, the UK, and the U.S., you can use these off-cycle processes to adjust payments made up to 6 years before the period in progress:

On-demand additional payments.

Manual additional payments.

Reversals.

For Payroll for France and Ireland, to adjust payments made before the period in progress, use a payroll input and then launch a retro payment calculation.

For Payroll for Canada, Ireland, the UK, and the U.S.:

Use Case	Off-Cycle Adjustment
A worker loses his bonus check from last pay period (CAN, USA)	Reverse the bonus payment and create a new payment for the prior period using a manual or on-demand payment.
A worker's regular gross payment of 2000 in a prior year should have been 2500.	Create an additional manual or on-demand payment for the prior period for 500 gross, minus taxes and other deductions. For Payroll for Ireland and the UK, Workday doesn't recommend creating on-demand or manual additional payments to adjust payments for prior tax years. Revenue in Ireland and HMRC in the UK require you to pay tax for the period in which the payment is made to the worker, even when the payment relates to work carried out in the previous year.
A company terminates a worker at the start of the last payroll period in the prior year. HR doesn't record the termination until the start of the new year (CAN, FRA, USA).	Reverse the final regular payroll payment and record the reversal as a prior period adjustment.
When auditing W-2 wage and tax data for the prior year, you discover incorrect results in a worker's W-2 (USA).	Depending on the type of error, you can take one of these steps to correct the W-2 data: Reverse the prior period payment and make additional off-cycle payments in the prior period. Reverse, and then replace, a prior year payment using on-demand processing. Use other combinations of off-cycle calculations. Before completing the W-2 process, complete any pending prior period off-cycle corrections or adjustments that might affect the wage and tax amounts in an employee's W-2.
You discover errors in a worker's W-2 data after sending it (USA).	Correct the errors using the appropriate combination of off-cycle calculations before you create and extract wage and tax data for the corrected wage and tax statement (W-2C).

Tax Filing Reports (CAN): These reports can help you reconcile your tax liabilities for adjustments:

Tax Remittance Summary - Federal
Tax Remittance Summary - Quebec
Tax Remittance Detail
Tax Filing Reports (USA): These reports can help you reconcile your tax liabilities for adjustments:

Tax Filing Periodic Data by Company
Tax Filing Periodic Data for Worker
Tax Filing Quarterly Data by Company
Tax Filing Quarterly Data for Worker
Payroll Accounting (CAN, IRL, UK, USA): The transaction date of a prior period adjustment is the last day of the pay period that contains the adjustment. To use the payment date, select the
Off-Cycle - Use Payment Date as Accounting Date
check box on the
Edit Tenant Setup - Payroll
task.
If the ledger period containing the transaction date has an Open status, Workday creates the accounting journal in that ledger period.
The accounting date automatically populates with the transaction date.
If you've closed the ledger period containing the transaction date, Workday searches in period order for a subsequent open ledger period. Workday then creates an accounting ledger in the first open period it finds.
The accounting date automatically populates with the first day of the first open ledger period.
If Workday doesn't find an open ledger period, the accounting journal goes into error status.
You can use either the ledger period or the accounting date when extracting adjustment data for financial accounting.
In your accounting reports, you can use the
Prior Year Period
report field to view accounting journal data from a period in a prior year.

Example: Pay Results (USA)

John has completed payroll results for 2015/01/01 - 2015/08/31. Payroll results for this time frame include:

Car Allowance: 500

QTD: 1,500

YTD: 1,500

In pay period 2015/03/01 - 2015/03/31, John should also have received an 8,000 car allowance.

Susan, the Payroll Administrator, needs to make a prior period adjustment to give John the 8,000 car allowance for the period 2015/03/01 - 2015/03/31.

The payroll for 2015/09/01 - 2015/09/30 is in progress. Susan creates an additional on-demand payment for John's car allowance in the amount of 8,000. She selects the

Prior Period

check box and the dates

2015/03/01 - 2015/03/31

, with a payment date of 2015/03/31.

The September payroll status changes to Requires Recalculation. Susan recalculates, then processes the September payroll. She then reruns the

Tax Filing Quarterly Data by Worker

report for John to validate that the taxes withheld on the car allowance were correct for Q1.

Adjusting Statutory Contributions (FRA)

To adjust Workday-delivered statutory contributions for a previous period, override the taxable wages or contribution ceilings. You can make this override by adding pay input on the appropriate pay component related calculation in a memo deduction. Examples:

Memo - Reference Values for URSSAF [FRA]

Memo - Reference Values for Pôle Emploi [FRA]

Memo - Reference Values for AGIRC-ARRCO [FRA]

Concept: Off-Cycle Payments

Reference: Edit Tenant Setup - Payroll

Reference: Tax Filing Reports