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Setting up allowances (New Zealand)

Allowances are additional payments to an employee's normal pay. MYOB Exo Payroll can handle allowances with different setups such as how the allowance is to be calculated.

Allowances such as bonuses and travel allowances are payments that are additional to an employee's normal pay. These allowances can be either Taxable or Non-Taxable. The steps below will guide you through the process of setting up new allowances in MYOB Exo Payroll.

Setting up new Allowances

Adding a new allowance in the software is done through the Allowance Maintenance screen. Allowance Maintenance can be accessed through the following methods:

  • Click on the Help menu then select Setup Cycle. Click on the 'Step 2 Add Allowances' button and the Allowance Maintenance screen will appear.
  • Click on the Maintenance menu then select Allowances. The Allowance Maintenance screen will apppear.
  • Press F2 then click on the Allowances button. The Allowance Maintenance screen will appear.


Enter the code that is to be used for this allowance up to a maximum of three numeric digits.

The code cannot be changed once the allowance has been saved.


Enter the allowance name up to twenty alphanumeric characters, e.g. Bonus.

Tax Setting

Select either Taxable or Non-Taxable to specify whether the allowance should be taxed or not.

Calculation Method

Choose from one of the following:

Fixed Dollar Amount

Choose this option if the allowance is to be a fixed amount each pay period. If this amount is the same for all employees then enter the amount. Otherwise, leave the amount as zero.

Rated Units

This means you have a payment that is valued at a certain rate each time it is paid. When this allowance is paid to an employee, enter the number of units that should be paid at this rate in the pay.

% of Salary & Wage

This allowance will be calculated as a percentage of the employee's total gross Wage or Salary.

Hourly Rate

This will multiply the hourly rate for the employee by the number of hours that you enter for that pay period.

When paying an allowance using this method, you need to enter the Pay Rate Type in the Rate Type field.

Total Hours

Enter the hourly rate for the employee in the Rate Field. The allowance will automatically be calculated based on the total number of hours the employee has worked.

% of Total Gross

This is a non-taxable method only. It will calculate the amount based on the total gross pay of the employee.

Equivalent Hours

This type will calculate the allowance using the hours based on the pay rate.

For example: The employee is being paid a tool money allowance at a rate of 10c per hour. The employee worked 40 hours ordinary time and 5 hours at time and a half. The allowance will be paid for a total of 47.5 hours. This is calculated as follows:

    1. 40 hours @ ordinary time = 40 x 1 = 40 hours
    2. 5 hours @ time and a half = 5 x 1.5 = 7.5 hours
    3. + b. = 40 + 7.5 + 47.5 hours

Specific Hours

For this calculation method, you have to enter the number of hours to pay this allowance.

For example: An employee is being paid an allowance of 10c for every hour worked after a specific time. You would enter those hours in the pay being processed against this allowance.


Enter the Amount/Rate/Percentage that the allowance should be paid at.

If the Amount/Rate/Percentage value differs for each employee or per pay period, leave this field blank. In the pay being processed the value can be entered that is specific to that employee.

Pay Rate Type

From the dropdown list, click on the Pay Rate Type at which this allowance should be paid, e.g. Ordinary, Time & Half, etc.

This field is only available if the Calculation Method is Total Hours, Equivalent Hours or Hourly Rate.

Wage Rate Code

If you are using Multiple Hourly Rates, enter the hourly rate this allowance is to use in its calculations.

This field is only available if the Calculation Method is Hourly Rate.

Maximum Number

This is the maximum number of units the allowance will pay the employee in the pay being processed.


Select the type of Allowance. Choose from one of the following:


Select this option for allowances such as Parking, Union Fees, etc.


Select this option for allowances paid to reimburse the employee for expenses.

Withholding Payment

Select this option for Allowances that are subject to Withholding Tax and that should be shown on the Employer Monthly Schedule (IR 348)

Extra Pay

Select this option to tax this allowance according to the employee's projected annual earnings. MYOB Exo Payroll will determine the tax rate by grossing the employee's earnings for the last 28 days to an annual figure then adding this Extra Emolument payment to determine the tax bracket the allowance will be taxed at.

Cost Centre

This is the Cost Centre to which the allowance is costed. Leave it empty if you wish to cost the allowance to the employee's Default Cost Centre.

Override Tax Rate

This option allows you to tax the allowance at a specific rate.

This option is only available for Taxable Allowances.



These options will be selected by default. Untick any options that do not apply for the allowance, e.g. if the allowance is to not apply to Holiday Pay calculations then 'Add to Gross for Holiday Pay' must be unticked.

Global Loading

This gives the ability to load an Allowance into the Standard Pay, Current Pay and/or One-Off Pay for all employees or a selected group of employees using the Global Load Wizard.


Global Load Wizard

Global Load Allowance

This is the code and name of the allowance that will be globally loaded.

Calculation Method

This is the calculation method used for this allowance.


Enter the units, amount or rate at which this allowance will be paid.

Cost Centre

This is the cost centre to which the allowance is costed. Leave this field empty if you wish to cost this allowance to the employee's default cost centre. If you choose to cost the allowance to a specific cost centre, you can override this by typing the appropriate code in this field.

Click on the [Next:F8] button or press F8 on your keyboard.


Wage or Salary Employees

From the dropdown list, select which employee you wish to add this allowance. Choose from: All, Salary or Wage.

Pays to Update

Select the pay period and frequency you wish to add this allowance to. Only employees that are in the selected pay period and frequency will receive this allowance. Select from one of the following: Standard Pay, Current Pay or One-Off Pay.

Click on the [Next:F8] button or press F8 on your keyboard.


Selection Ranges

You can add this allowance to specific Employees, Departments and/or Cost Centres by entering the appropriate selections in the fields.

If these ranges are left blank, the allowance will be applied to all employees that meet the criteria previously selected.

Click on the [Save:F10] button or press F10 on your keyboard to save the allowance. This will complete the Global Load process.

The allowance will be added to the appropriate employees and Pays as determined by the selections made in the Wizard.

Need more help? You can open the online help by pressing F1 on your keyboard while in your software.

You can also find more help resources on the MYOB Exo Employer Services Education Centre for Australia or New Zealand.

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