Calculation
When you click Calculate on a draft or calculated pay run, the system processes every eligible employee and computes their full pay breakdown. How Calculation Works For each active...
When you click Calculate on a draft or calculated pay run, the system processes every eligible employee and computes their full pay breakdown.
How Calculation Works
For each active (and optionally on-hold) employee:
- Gather components — collect all assigned and enabled earning/deduction/employer contribution components
- Compute gross — sum all earning components (fixed amounts or percentage of base salary)
- Apply deductions — subtract all deduction components (including loan installments)
- Calculate pension contributions on the capped pensionable base:
- SSNIT Tier 1 Employee: 5.5% of pensionable earnings (capped at GHS 61,000/month)
- SSNIT Tier 1 Employer: 13% of pensionable earnings (capped at GHS 61,000/month)
- Tier 2 Occupational Pension: 5% employer contribution (capped at GHS 61,000/month)
- Tier 3 Voluntary Pension: Per-employee rates (combined max 16.5% of basic salary)
- Apply tax reliefs — deduct monthly relief amounts (annual ÷ 12) from taxable income
- Calculate PAYE — apply the progressive tax bands to chargeable income (after SSNIT and relief deductions):
| Monthly Chargeable Income (GHS) | Tax Rate |
|---|---|
| 0 – 490 | 0% |
| 491 – 1,200 | 5% |
| 1,201 – 2,000 | 10% |
| 2,001 – 3,400 | 17.5% |
| 3,401 – 50,000 | 25% |
| Above 50,000 | 35% |
- Apply special tax rules (if applicable):
- Non-resident employees: Flat 25% tax on all income
- Casual workers: Flat 5% tax
- Bonus: First 15% of annual basic salary taxed at special rate (5% for residents, 20% for non-residents)
- Overtime: Special rate for junior employees (basic < GHS 18,000/year)
- Compute statutory total — PAYE + employee SSNIT + employee Tier 2 + employee Tier 3
- Compute employer cost — gross + employer SSNIT + employer Tier 2 + employer Tier 3 + employer contributions
- Compute net pay — gross minus deductions minus statutory deductions
Minimum Wage Check
The system validates each employee's effective daily rate against the national minimum wage (currently GHS 21.77/day for 2026). If an employee's gross pay divided by 22 working days falls below the minimum wage, a warning is flagged during calculation.
Delta Comparison
The system automatically compares each employee's net pay against their net in the most recent prior run. If the change exceeds 10%, a warning is flagged for review. This catches data entry errors, missing components, or unexpected salary changes.
Recalculation
You can recalculate at any time before posting:
- Full recalculation — recalculates all employees in the run
- Individual recalculation — recalculates a single employee (useful after editing their profile or components)
- Bulk recalculation — select multiple rows and recalculate them together
Recalculation uses the latest employee data and statutory rates. If you update an employee's salary or components, recalculate to see the updated figures.