Allowances

This guide covers the rules that decide what gets added to an employee's pay. For what gets taken away, see Deductions.

Purpose

Most pay isn't just base salary — transport, housing, a child benefit, overtime pay. This answers: "What gets added to someone's pay, how much, and who does it apply to?"

Who an Allowance Applies To

An allowance can target:

• Every active employee.
• Specific, named employees.
• Anyone matching a condition — for example, marital status, years of experience (personal or time at the company), gender, country, state, pay frequency, wage type, or department as recorded on their contract.

Employees can also be explicitly excluded from any of the above, and more than one condition can be combined for precise targeting (for example: married and in a specific department).

How the Amount Is Calculated

An allowance's amount is one of:

• Fixed — a flat number.
• A percentage of basic pay.
• A fixed amount per child — for a dependent/child benefit style allowance.
• Attendance-driven (requires Attendance) — a fixed amount for every validated attendance day, for every validated attendance day on a specific shift, for every validated attendance day on a specific work type, or a fixed amount per hour of approved overtime.

A maximum can optionally be capped on any non-fixed allowance, expressed against a working-days-in-the-month limit, so a rate-based or attendance-driven allowance never produces an unexpectedly large number in a short or long month.

Conditional Pay-Figure Gating

Beyond who it targets, an allowance can also be gated on a pay figure itself — for example, only applying if the employee's basic pay is greater than, less than, or within a range of a chosen amount. This is separate from (and can be combined with) the employee-attribute targeting above; one controls who qualifies, the other controls under what pay conditions it kicks in.

One-Time vs. Recurring

An allowance with a specific date attached only applies to the payslip covering that date — a one-time bonus. Without a date, it applies to every payslip that matches its targeting rules going forward — a recurring allowance.

Taxable or Not

Each allowance is marked as either counting toward taxable income or not. A non-taxable allowance still adds to gross pay, but is excluded from the figure Tax is calculated against.

What Each User Sees

Action	Employee	HR / Payroll Administrator
See their own allowances on a payslip	✅	✅
Create, edit, or delete allowances	—	✅

How Visibility Is Decided

1. Ownership. An employee sees how allowances apply to them, on their own payslips.
2. Permissions. Creating and managing allowance rules requires the relevant permission.

Customization Options

• Targeting — company-wide, specific employees, or condition-based (with multiple combined conditions) — is fully configurable per allowance.
• Calculation basis — fixed, a percentage of basic pay, per child, or one of several attendance-driven bases.
• Conditional gating on a pay figure (basic or gross pay) can restrict when an allowance applies.
• Caps are optional on any non-fixed allowance.
• Taxability is a simple yes/no toggle per allowance.

Good to Know

• Loans, salary advances, and reimbursement payouts are just allowances under the hood. The system automatically creates one to pay each of these out — see Loans & Advanced Salary and Reimbursements & Encashment. These auto-created allowances are hidden from the main Allowances list (they only show on the specific employee's own record) so they don't clutter the list of company-defined rules.
• A one-time allowance only ever applies once. If its date falls outside every generated payslip's period, it simply never gets applied — worth double-checking the date against your payslip generation schedule.
• This is the counterpart to Deductions — the same targeting mechanism (all/specific/condition-based) is shared by both, but the calculation options differ: Deductions can be based on gross, taxable-gross, or net pay too, and support a few mechanisms — like employer contributions — that don't apply to Allowances.

Everything added, on the record.