Copy of Deduction Rule

Some companies permit employees to charge expenses to either meals/lodging expense types or to a per diem expense type. DATABASICS Expense can be configured to deduct an amount from the per diem if an employee charges both per diem and a meal or lodging for the same date. A common example would be when an employee takes a client to dinner and charges the total to a dinner expense type.

For per diem deductions to function, DATABASICS Expense must have both the appropriate per diem expense type, as well as the meals and/or lodging expense types set up.

To set up a per diem deduction:

1. Expand the Expense menu.
2. Expand the Per Diem Setup menu.
3. Click Deduction Rule
4. Click the Add button.
5. In the Effective Date field, enter a date from which this deduction will be effective.
6. (V8.3 and higher) To assign the deduction rule to a specific Operating Unit, select a specific Operation Unit, otherwise leave the field as ALL
7. (V8.3 and higher) To assign the deduction rule to a specific Department, select a specific Department, otherwise leave the field as ALL
8. (V8.3 and higher) To assign the deduction rule to a specific Location, select a specific Location, otherwise leave the field as ALL
9. If the deduction will apply to only one country, enter the country. Otherwise, leave this field as All 
10. If the deduction will apply only within one state in the selected country, enter the state. Otherwise, leave this field as All
11. If the deduction will apply only within one city in the selected country/state combination, enter the city. Otherwise, leave this field as All 
12. In the ID field, select the expense type for which this deduction will apply. (See ID Field Definition table below)
13. In the Value Type field:
    • Select % of original rate for 1/2 day if the deduction is a percentage of money off the 1/2 day per diem rate.
      • "Rule Based" option is selected in the ID field and specifies the deduction rule set in the "Deduction Rule" table should be based on the percentage of full daily rate
    • Select % of original rate for 1/4 day if the deduction is a percentage of money off the 1/4 day per diem rate.
      • "Rule Based" option is selected in the ID field and specifies the deduction rule set in the "Deduction Rule" table should be based on the percentage of full daily rate
    • Select % of original rate for 3/4 day if the deduction is a percentage of money off the 3/4 day per diem rate.
      • "Rule Based" option is selected in the ID field and specifies the deduction rule set in the "Deduction Rule" table should be based on the percentage of full daily rate
    • Select % of original rate for full day if the deduction is a percentage of money off the full day per diem rate.
      • "Rule Based" option is selected in the ID field and specifies the deduction rule set in the "Deduction Rule" table should be based on the percentage of full daily rate
    • Select Absolute Value specified with a currency if the deduction is a specific amount of money.
      • If "Rule Based" option is selected in the ID field this option specifies if the deduction rule set in the "Deduction Rule" table should be based on the absolute value instead of percentage.
    • Select Absolute Value specified with a currency for 1/2 day if the deduction is a specific amount of money for the 1/2 day 
      • If "Rule Based" option is selected in the ID field this option specifies if the deduction rule set in the "Deduction Rule" table should be based on the absolute value instead of percentage.
    • Select Absolute Value specified with a currency for 1/4 day if the deduction is a specific amount of money for the 1/4 day
      • If "Rule Based" option is selected in the ID field this option specifies if the deduction rule set in the "Deduction Rule" table should be based on the absolute value instead of percentage.
    • Select Absolute Value specified with a currency for 3/4 day if the deduction is a specific amount of money for the 3/4 day
      • If "Rule Based" option is selected in the ID field this option specifies if the deduction rule set in the "Deduction Rule" table should be based on the absolute value instead of percentage.
    • Select Absolute Value specified with a currency for full day if the deduction is a specific amount of money for the full day
      • If "Rule Based" option is selected in the ID field this option specifies if the deduction rule set in the "Deduction Rule" table should be based on the absolute value instead of percentage.
    • Select Percentage from Adjusted Per Diem Rate if the deduction is a percentage of the per diem rate after any other deductions have been applied (ex: Allowance Rule).
      •  If "Rule Based" option is selected in the ID field then this option specifies if the deduction rule set in the "Deduction Rule" table should be based on the percentage of the adjusted daily rate (so in case where 1^st/last day 75% deduction is applied, the additional deduction will apply to the 75% of the daily rate)
    • Select Percentage of Per Diem Rate. (Note: Currency is N/A if the deduction is a percentage of the per diem rate.)
      • If "Rule Based" option is selected in the ID field, then this option specifies if the deduction rule set in the "Deduction Rule" table should be based on the percentage of full daily rate
14. In the Breakout Flag Field:
    • Select Yes, apply to adjusted per diem rate - System looks at the "Deduction Fixed Rate" table and applies adjusted deduction based on the adjusted daily rate.
    • Select Yes, apply to original per diem rate - System looks at the "Deduction Fixed Rate" table and applies full deduction based on the fill per diem rate.
    • Select No - System ignores the "Deduction Fixed Rate" and reads the deduction percentage/value set in the "Deduction Rule" table

                    Note: Deduction Fixed Rate must be set up in order to use the Breakout Flag.               

    12. In the Value/Percentage field, enter a specific value or percentage this rule is based on.
    13. In the Currency field, select a currency if an Absolute Value was selected in the Value Flag field.
    14. In the Per Diem Type, select the per diem type against which this deduction will apply.

Example - Deduction Rule

Transcontinental Consultants, Inc. (TCI) uses meals per diem. When a TCI employee dines out with a client, the employee is to charge the total meal charge to the appropriate meal expense type. To avoid paying both the meal expense type charge and the meals per diem charge, TCI uses per diem deductions. If an employee enters a breakfast expense and charges per diem, the meals per diem rate is reduced by 20%. If an employee enters a lunch expense and charges per diem, the meals per diem rate is reduced by 30%. If an employee enters a dinner expense type and charges per diem, the meals per diem rate is reduced by 50%.

The table below illustrates the effect on an expense report's per diem calculation for a user who enters a breakfast (20%), lunch (30%) and dinner (50%) while also claiming meals per diem of $50 per day.

Setting Up the Example

Reducing per diem for a breakfast charge

Reducing per diem for a lunch charge

Reducing per diem for a dinner charge

Effect on Expense Report

ID Field Definition of Provided/Taken and Rule Based

Note: When the non-rule based Provided/Taken are being used the system option needs to be setup to specify if the deduction/allocation should be based on the full rate or adjusted rate (this is in system options)