An amount owed by an employee that is taken back out of their pay, such as a salary advance, a loan, or an overpayment being corrected.
When to use it
When money has been given to an employee and is to be recovered from later salary instead of repaid separately.
Before you start
Agree the total amount and how it will be recovered, and write that agreement down outside the system as well. You will be tracking the outstanding balance by hand, for the reason explained below.
Where to find it
Open the HR area from the main menu, then Payroll, then Compensation Recoverable.
The fields on this screen
| Field (on screen) | What to enter | Required |
|---|---|---|
| Employee | The person this money is recovered from. Their open balances are added up when pay is worked out. | No |
| Type | What is being recovered: advance, damage, penalty or other. It does not change how much is taken. | No |
| Principal Amount | The full amount originally owed. Recovery works off the balance below, not off this figure. | No |
| Balance Amount | What is still owed. Recovery stops once it reaches zero, and nothing reduces it for you. | No |
| Monthly Installment | What you mean to recover each month. It is not what gets deducted - the pay rule's own amount decides. | No |
| Start Date | (not explained yet) | No |
| Target Component | (not explained yet) | No |
| Linked Voucher | (not explained yet) | No |
| Active | Only an active row is recovered from pay. Untick it to stop the deduction without deleting the record. | No |
| Notes | (not explained yet) | No |
How it works
A payroll run applies the recovery as a deduction on the employee's slip.
Track the balance yourself
Two things on this screen do not behave the way their labels suggest, and both need a manual habit.
The outstanding balance does not go down on its own. Nothing updates it when a recovery is taken, so it stays at whatever you typed until you change it. After each payroll run, reduce the balance by what was actually recovered, or you will lose track of what is still owed.
The instalment amount on this record is not what gets deducted. The amount taken comes from the recovery rule applied to the employee, not from the figure entered here. If that rule has no amount set, the deduction is the whole outstanding balance in a single period. On a salary advance that can take somebody's entire pay.
Before the first run after setting up a recoverable, check the employee's slip. Make sure the deduction is the instalment you intended and not the full amount.
Tips and common mistakes
- Set up one recoverable and watch it through one full period before creating several.
- Write the agreed instalment in the record's own notes. That way the intended figure is kept, even though the system does not enforce it.
- When the balance reaches zero, close the record. Nothing closes it for you.
Related guides
- Compensation Adjustment: for a one-off deduction instead of one recovered over time
- Bulk Salary Slip Run: where the deduction is applied
- Salary Slip: where you check the amount actually taken