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:

1. Go to the employee's profile.
2. Click Add next to Payslip Inputs.
3. Click Annual Bonus under Income.

4. Enter an amount.

   Calculating a bonus with a formula

   To use a formula to calculate the bonus, enter it in the amount field instead of a fixed amount. Formulas must start with =.

   For example, enter = basic_salary * 0.5 to pay a bonus of 50% of the employee's basic salary.

5. Click Save.

Annual bonuses are classified as Additional Wages (AW) and impact the calculation of CPF. See more on the CPF help page.

Contractual bonuses

Contractual bonuses for the current year that are paid only in the following year should still be 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.