Multiple Pay Periods on a Single Paycheck

When a paycheck includes transactions from more than one week worked, such as retro pay or a catch-up check, Back Office and Classic can calculate each week's tax withholding separately and combine the results on a single paycheck.

Key Takeaways

• Enabling the ProcessTaxesByWeekWorked Config Option calculates taxes separately for each week worked included on a paycheck, using the talent's normal weekly pay cycle rate.
• The separately calculated amounts combine onto one paycheck, so retro pay does not need its own payroll batch.
• This Config Option defaults to False. Turn it on in Admin Tools to change this behavior for your account.

Example

A talent misses hours on last week's check. This week, the client adds a transaction for the missed hours dated to last week's work week, alongside this week's regular pay transaction dated to the current work week, both on the same paycheck. Because the talent is paid weekly, each work week's wages should calculate tax at the weekly rate. Without this Config Option enabled, Back Office and Classic treat the combined amount as a single bi-weekly payment and apply the bi-weekly tax rate instead, which under-withholds Federal and State tax.

How Multi-Week Tax Calculation Works

When ProcessTaxesByWeekWorked is set to True, Back Office and Classic send each week worked as its own request to Vertex, so each week is taxed at the correct rate for the talent's pay cycle, then combine the results on the paycheck. When set to False (the default), the system continues to behave as it currently does, taxing the combined amount as a single payment.

ProcessTaxesByWeekWorked Config Option

Turning This On

1. Set the ProcessTaxesByWeekWorked Config Option (Config Option > Supplier > EmployerSettings) to True.
2. Enter or import transactions for the talent covering multiple weeks worked in the same payroll batch, as normal.
3. Process payroll. Each week worked calculates its taxes separately, and the amounts combine on the talent's single paycheck.