CONTENT
- Return by offsetting
- Return as gross recovery and unjust enrichment
- Separate notification for the payment month targeted by the return
- Return of fringe benefits
- Frequently asked questions
Return by offsetting
An overpayment can be corrected by offsetting the amount of the overpayment on the employee's next payslip as a deduction from the gross salary. Offsetting should be done from the income type that is being paid on the payslip, as the sum of the income type cannot be reported as negative. Offsetting can only be used if the overpayment can be fully offset in the next payroll. Offsetting should not be used if the payroll information for the wrong month would affect the employee's benefits, such as sick pay.
Example: An employee was paid 200 euros too much evening allowance in February. The error is corrected on the March payslip by deducting the 200 euro overpayment made in February from the March evening allowance (280 euros). After offsetting, 80 euros of evening allowance remains to be paid for March.
February payslip:
February earning payment report for income type 206:
The overpayment is corrected by adding an Evening allowance salary type to the March payslip, with the amount of the overpayment from February as a negative:
March earning payment report for income type 206, i.e., 280 euros - 200 euros = 80 euros:
Return as gross recovery and unjust enrichment
An overpayment received by the employee can be recovered on a future payslip either as a gross or net recovery. This guide addresses gross recovery, as gross recovery can be used in all situations, including correcting an overpayment recovered within the same year.
When an overpayment is noticed, the earning payment report is corrected, and the portion of the overpayment is reported as unjust enrichment. Then, when the overpayment is deducted on a future payslip or the employee returns the money to the employer, it is reported on the earning payment report as a return. The unjust enrichment and return related to the overpayment must always be reported as a pair to ensure the correction is targeted correctly for the users of the Income Register.
In gross recovery, the gross amount of the overpayment is deducted from the salary to be paid to the employee, without considering the withholding tax deducted from it. The pension and unemployment insurance contribution related to the overpayment are also considered.
The excess withholding tax is considered only in the employee's final taxation. Alternatively, the employee can apply for a revised tax card after the correction of the overpayment (once the Income Register has processed the earning payment report), where the excess withholding tax will be considered in the calculation of the new tax card.
Example:
An employee was paid 900 euros too much monthly salary in February. The monthly salary should have been 1900 euros instead of 2800 euros, and the overpayment was noticed after the March payroll. The overpayment is deducted on the next, i.e., April payslip. The normal monthly salary for April is 2800 euros, which is paid at the same time.
A replacement notification is sent for the February earning payment report, where the portion of the overpayment is marked on its own row as unjust enrichment with the amount of the overpayment, and the original income type amount is manually edited to the value that should have been paid initially.
Please note that the unjust enrichment also affects the separate notification for the payment month of the original payslip. Please also make a replacement separate notification for the changed employer's health insurance contribution.
You can access the employer's separate notifications help guide here.
April payslip and return:
Thus, a Monthly salary salary type row is added to the April payslip, with the amount of the overpayment -900 euros and information about the return. Select the payslip to be corrected and the salary type row to be corrected in the return information. When using gross recovery, the withholding tax related to the return is not reported.
In gross recovery, the basis for calculating the withholding tax must be manually edited to the amount of the salary to be paid before the return. April payslip after correcting the basis for calculating the withholding tax:
April earning payment report for income type 201:
Separate notification for the payment month targeted by the return
On the April separate notification, the basis for calculating the employer's health insurance contribution is only the corrected monthly salary amount (1900 euros). The correction of the health insurance contribution for the overpayment has already been considered in the corrected February separate notification, which is why the April health insurance contribution must be reported from the normal total salary for April (2800 euros). The basis for calculating the separate notification cannot be edited before sending the notification, so the notification must first be created and sent with the amounts on the payslip. When the separate notification is in the Income Register status, a replacement notification can be created with a larger amount.
Return of fringe benefits
Fringe benefits are not paid to the employee in cash, so the method of reporting unjust enrichment and return is not used to correct errors in them. It is not unjust enrichment, but a reporting error, as the fringe benefit has been available to the recipient regardless of whether it has been reported. The fringe benefit is considered income for the month in which it was available to the employee.
Excessively reported or unreported fringe benefits are corrected for the target month, and employer's contribution corrections are made on the next payslip.
Frequently asked questions
Can a return be made in Netvisor that targets an earning payment report sent from another system?
The use of the return function is only possible if the unjust enrichment was paid on a Netvisor payslip. This is because, in the additional information for the return, the payslip and salary type row where the unjust salary was originally paid are selected from a dropdown menu. If the system has changed in between, you can make a notification of the return and unjust enrichment in the Income Register's electronic service.
How can excess fringe benefits be corrected?
Fringe benefits cannot be corrected by return. According to the Income Register's instructions, correct the earning payment report for the month in question by providing a replacement notification and report the actual value of the fringe benefit. In payroll, you can create an additional payslip for the desired period as negative, which can correct payroll information for Netvisor's reporting and cumulative earnings on the payslip, but the earning payment report for this payslip cannot be sent to the Income Register, and it is marked as processed manually.
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