To create a Transport Allowance item, from the Payroll item list, add a new payroll item for Addition Payroll item type. Link Transport Allowance item to a Payroll Expenses account (usually, I use Transport Allowance Expense account).
Select ‘None’ for Tax tracking type, the rest of the tax type are not for Singapore user. In the Taxes window uncheck the selection for ‘PAYG Tax’.
In the Calculate based on quantity window, you have three selections:
- Calculate this item based on quantity
- Calculate this item based on hours
If your Transaction Allowance is base on monthly fixed amount, then in this case, you select ‘none’.
In the Default rate and limit window, you have an option to enter the default amount or percentage. Besides, you can also enter the upper limit for this addition item.
In addition, you should also uncheck the check box for ‘This is an annual limit.’ It is because if selected, it will restart the calculations at the beginning of every year.