Addition of a taxable deduction

In this example, in August, the employee has an absence deduction of Rs 4,601. This deduction reduces the taxable emoluments and the chargeable income, and therefore decreases the PAYE. The illustration below shows how the EDF adjustment is applied in the month of August.

Follow the steps below to verify the PAYE calculation checklist:

• Check the Pay Period: In this example, the PAYE Calculation Checklist is for the month of August
• Check the section “Your PAYE Particulars” : In this example, the employee has submitted an EDF and is a Citizen of Mauritius
• Step 1: Check the Emoluments for the month, for example: Salary, Overtime, Commission, and Absence Deduction.
• Step 2: Check the Total emoluments paid in previous months, which in this example refers to the July emoluments, since the PAYE Calculation Checklist is for the month of August.
• Step 3: Ensure that the employee’s Reliefs and Exemptions are correctly applied according to their EDF.
• (0* 2 / 13) + 0 + (0 * 1) is illustrated via 3(a–c) and correspond to the following:
• 3a → 0 indicates that the EDF was submitted with only the self exemption.
• 3b → 2 corresponds to August, which is the 2nd month of the fiscal year.
• 3c → 13 represents the fiscal year from July to June, which includes 13 months because of the end-of-year bonus.
• Step 4: Ensure that the Chargeable Income corresponds to the difference between the total emoluments (including taxable benefits, if any) and the less reliefs and exemptions.
• Step 5: Check the Tax Charged (PAYE) from the Tax on Progressive Scale table.
• Step 6: Check the ” Tax paid in previous months. In this example, it refers to the tax of July, since the PAYE Calculation Checklist is for August.
• Step 7: “Tax to be withheld in the month” represents the difference between the Tax Charged (PAYE) from the Tax on Progressive Scale table and the tax paid in previous months. In this example, the tax payable for the month is lower than the tax paid in the previous month due to the addition of the taxable deduction.