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What is an allowance, a reimbursement, or a garnishment

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Allowance

An allowance or an advance is any periodic or lump-sum amount that you pay to your employee on top of salary or wages, to help the employee pay for certain anticipated expenses without having them support the expenses. An allowance or advance is:
  • usually an arbitrary amount that is predetermined without using the actual cost
  • usually for a specific purpose
  • used as the employee chooses, since the employee does not provide receipts
An allowance can be calculated based on distance, time or something else, such as a motor vehicle allowance using the distance driven or a meal allowance using the type and number of meals per day. Nmbr supports the ability to configure one-time and recurring allowances.

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Reimbursement

A reimbursement is an amount you pay to your employee to repay expenses they incurred while carrying out the duties of employment. The employee must keep proper records (detailed receipts) to support the expenses and give them to you. Nmbr supports the ability to configure one-time and recurring reimbursements.

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Deductions

A deduction is an amount you deduct from your employee’s earnings and remit to another recipient such as the CRA. For example, if your employee owes the CRA a sum of money and refuses to pay it, it is possible that the CRA may garnish that employee’s wages. In such a case, the CRA will send you a request - such as a Requirement to Pay (RTP) notice - for you to send the amount owed to the CRA instead of giving it to the employee. You are responsible for deducting the amount specified in the notice and remitting it to the CRA. If you do not comply with the requirements, you may be held responsible for the amounts you didn’t remit. Nmbr supports the ability to configure one-time and recurring deductions.

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Updating, ending, and deleting

Allowance, reimbursement, and deduction records can be updated, ended, or deleted after a payroll that uses them has been approved. Unlike Tax Properties and Remittance Accounts, these records do not expose is_editable or is_deletable fields, so you do not need to hide those actions because an approved payroll already used the record. Changes are forward-looking. Draft and future pay stubs use the latest record state the next time they are calculated. Approved payrolls keep the line items and amounts that were approved.
  • Update a field such as amount, and draft or future pay stubs use the new value when recalculated. Approved pay stubs keep their original amount.
  • End the recurrence by setting effective_to. The line item no longer appears on pay stubs after effective_to. Approved pay stubs on or before that date are unchanged.
  • Delete the record, and it is removed from draft and future pay stubs. Approved pay stubs keep the line item that was already approved.
This is different from component_settings.attributes_locked on pay stub line item resources. That field controls whether the generated line item can be edited in the Nmbr Component; it does not make the source allowance, reimbursement, or deduction record read-only.