Loan / Advanced Salary

This guide covers loans, salary advances, and fines — money that moves outside the standard monthly pay cycle, paid out or recovered over time. For expense reimbursements and encashment, see Reimbursements & Encashment.

Purpose

A loan needs to be paid out once and recovered gradually; a fine needs to be recovered with no payout at all. This answers: "How does the system track money owed between the company and an employee, outside the regular payslip?"

Types

A loan account covers three cases:

• A loan — a lump sum paid out to the employee, recovered in installments.
• An advanced salary — the same mechanism, used for an early draw against future pay rather than a traditional loan.
• A penalty / fine — a deduction-only record, with no payout at all. If Assets is installed, a fine can be linked to the specific asset record it relates to — for example, a damage charge tied to the item that was damaged.

Payout & Repayment Schedule

Creating a loan or advance automatically sets up:

• Its payout — a one-time addition to an upcoming payslip, for the full loan amount.
• Its full repayment schedule — a series of future deductions, one per installment, spaced one month apart starting from a chosen installment start date.

An individual installment amount can be manually adjusted later, redistributing the remainder across whatever installments haven't been paid yet. Progress can be tracked as a percentage — how many installments have actually been paid out of the total. Marking a loan settled cancels any installments still outstanding.

What Each User Sees

Action	Employee	HR / Payroll Administrator
View their own loans/advances and repayment progress	✅	✅
Create, edit, or settle a loan/advance/fine	—	✅

How Visibility Is Decided

1. Ownership. An employee can always see their own loan and advance records and how much is left to repay.
2. Permissions. Creating, editing, and settling a loan, advance, or fine requires the relevant permission — there's no reporting-manager visibility into a team's loans by default.

Customization Options

• Installment count determines how many payslips the repayment is spread across.
• Installment start date determines when recovery begins, independent of when the payout happens.
• Individual installment amounts can be adjusted after the fact.

Good to Know

• Loans pay out and recover through the payslip cycle, not immediately. The payout only actually reaches the employee once a payslip covering the relevant date is generated, and each installment only actually applies once a payslip covering its date is generated — see Payslips.
• A loan's payout and its installments are just an allowance and a set of deductions under the hood. See Allowances and Deductions. They're automatically hidden from those modules' main lists, showing only on the specific employee's own record.
• An already-settled loan, or one with installments already paid, can't be deleted — its history stays on file.
• Repayments always land at the end of the month, regardless of when in the month the installment technically falls due.

Paid out, paid back, tracked either way.