Understanding the Tags Feature

Overview

The Tags feature allows payroll data to be categorized and allocated across operational dimensions such as departments, projects, locations, or positions. This functionality supports more detailed payroll reporting, accounting code mapping, and journal entry tracking.

By assigning tags to payroll data, organizations can distribute payroll expenses and liabilities across multiple business areas while maintaining accurate accounting records.

How Tagging Works

The tagging workflow follows four primary steps:

1. Create tag groups and tags

2. Assign tags to payroll data

3. Configure accounting code rules

4. Generate journal entries based on tag allocations

Each payroll line item can be allocated across one or more tags to support detailed cost distribution.

Key Concepts

Tag Groups and Tags

Tag groups represent categories used for payroll allocation.

Examples of tag groups include:

• Department

• Project

• Location

• Position

Tags are the individual values within each group.

Examples include:

Each tag belongs to a specific tag group and business entity.

Tag Assignments and Allocations

A tag assignment defines how payroll amounts are distributed.

Supported allocation methods include:

• Percentage-based allocations

• Dollar-based allocations

• Hours-based allocations (earnings only)

Examples:

• 60% Engineering / 40% Sales

• $500 allocated to Project Alpha

• 20 hours assigned to a specific location

Allocations must total 100% or less.

If allocations do not equal 100%, any remaining amount will follow the default accounting rules.

If no valid accounting code can be resolved, payroll processing will be blocked until the issue is corrected.

Where Tags Can Be Applied

Tags can be assigned at multiple levels within payroll processing.

Work Assignment: Defines the default allocation applied to employee payroll items.

Payroll Item Types or Generators: Applies allocations to specific payroll item categories such as:

• Earnings

• Allowances

• Reimbursements

• Benefits

• Deductions

These assignments override work assignment defaults.

Payroll Line Items: Allows custom overrides for individual payroll entries.

Tagging Precedence

When payroll is calculated, the system determines the effective tag assignment using the following priority order:

The final resolved assignment is used for accounting and reporting purposes.

Rules are re-evaluated whenever payroll is recalculated. Updates to tagging or accounting rules will apply during the next payroll calculation for draft payrolls.

Primary Tag Group

Each business can configure a primary tag group. The primary tag group is required for accounting code mapping because it determines which accounting rules are applied during payroll processing.

All allocations must include a tag from the primary tag group.

If a primary tag group is not configured, payroll processing will be blocked until one is established.

Accounting Code Mapping

Tags are connected to accounting codes through accounting code rules.

During payroll calculation:

1. The system evaluates each tag allocation

2. Matching accounting rules are identified

3. Expense and liability codes are assigned automatically

Rule Resolution Order

Accounting rules are resolved using the following precedence:

Journal Entry Tracking

Tags can also be used as tracking dimensions within journal entries.

When enabled:

• Each tag allocation generates a separate journal entry row

• Journal entries include associated accounting codes and tag values

• Financial reporting can be segmented by department, project, location, or other dimensions

Example

A $5,000 salary earning allocated:

• 60% Engineering

• 40% Sales

Would generate separate accounting rows for each allocation.

This allows organizations to track payroll costs at a more granular level within accounting systems.

Statutory Withholdings

Statutory withholdings such as:

• CPP

• EI

• Income Tax

cannot be tagged directly.

Instead, these deductions inherit allocations proportionally from the related earnings.

Example

If earnings are allocated:

• 60% Engineering

• 40% Sales

Then statutory deductions will follow the same proportional distribution.

Important Considerations

• Allocations must not exceed 100%

• A primary tag group is required for payroll processing

• Missing accounting mappings may block payroll calculations

• Payroll recalculations will re-evaluate tag assignments and accounting rules

• Statutory deductions inherit allocations from associated earnings

Summary

The Tags feature provides a structured framework for allocating payroll costs across operational dimensions such as departments, projects, and locations. By combining tag assignments with accounting code rules, organizations can automate financial allocations, improve reporting accuracy, and generate detailed journal entries that align with business accounting requirements.