Payroll Processing > System Items > Annual Bonus
SimplePay has a built-in item to accommodate the CPF treatment and tax reporting requirements for annual bonuses. An annual bonus is a reward (often performance-based) paid to an employee, usually at the end of the year or in the employee’s birthday month. To add an annual bonus to a payslip:
- Go to the Employee’s profile
- Click on Add (next to Payslip Inputs)
- Select Annual Bonus under Income
- Enter an amount
- Click Save
Annual bonuses are classified as Additional Wages (AW) and impact the calculation of CPF. To read more about CPF, go to the following help page:
Payroll Concepts > Statutory Deductions and Contributions > CPF
Please note: Contractual bonuses for the current year that are only paid in the following year should still added as income to a payslip in the current year. This will ensure that the bonus gets applied to the IR8A for the correct tax year.
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