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Re: Proposed schema for payroll

On Fri, Oct 28, 2011 at 4:53 AM, Thomas Bullock <..hidden..> wrote:
> Chris,
> My experience is with US payroll only.  That is, I don't know what European, Australian, and other country methods of handling payroll require.
> In the US there are different types of income an individual is taxable on.  For example, interest, dividends, royalties, prizes, awards, lottery winnings, fees company Board members are paid, reimbursement of various expenses (moving, travel, etc.), compensation for services rendered (wages, salaries, etc.), and so on.  But most of these are not in a payroll system.  So income types would only be for compensation related types, of which there are but a few.

And of course it's more complicated than that.

In some states (Washington, for example), different types of income
may be subject to different payroll taxes.  Suppose you have a guy who
picks apples in the orchard, drives a forklift, and helps stocking
fruit at your farm stall.  You likely have hourly and per-production
wages to account for and these have different tax deductions.....

Obviously this has to be taken care of by a tax module.  We can't do
it for everyone the same.
> Since I prepare tax returns for international visitors to the US, there are different rules and forms to use.  For example, there are wages or salaries.  But if some or all the earnings are exempted due to a tax treaty a taxpayer is entitled to, then the US system at year-end issues form W-2 to report gross wages and taxes and other deductions withheld during the year.  If there was a tax treaty, then a form 1042-S is issued to show the amount of compensation that is excluded from taxation for the tax year.  That form also is used to report taxable living expense scholarships (which are not considered compensation and so are not part of payroll).

> I guess my point is that whatever payroll system you develop, you also need to categorize income paid in different manners when outputting reports to the governments and taxpayers.   I don't know enough about DB design, so I may have missed that this issue is included in what you presented below.  If not, then some consideration for types of output should be added.

Yes, this categorizes income paid and deductions in ways that local
tax modules can address these.

Best Wishes,
Chris Travers