You can define specific line items in this section to appear on your Cost Estimate to capture assignment costs for tax calculations. There are four section to configure:

Click

to add new line items or select

to view, edit, or delete existing estimate line items.

You can group line items in an assignment estimate into various sections and sub-sections on the screen and the Cost Estimate report. Furthermore, sections and subsections define how line items are totaled and subtotaled.

Standard sections available are

To add, edit or delete the standard sections, update them in the Lookup Maintenance screen at the system level. From the Lookup Field, choose 'Cost Estimate Section'. Follow the steps here to configure Lookup Maintenance dropdown fields.

Within a section, you can further categorize line items into subsections. Subtotals from subsections are rolled up to the total of the relevant section. Standard subsections available are:

Choose Cost Estimate Sub-Section from the Lookup Field to add, edit or delete the subsection names. Follow the steps here to configure Lookup Maintenance dropdown fields.

Sequence defines the order that the line items appear on the Cost Estimate screen and the Cost Estimate report within the relevant section. A blank will be considered as “zero” and the line will precede any numbered line item of that section. Sequence numbers order line items of the same section. Subsection sequencing is also available. In the absence of sequence numbers or when more than one line has the same sequence number, line items are ordered in the sequence they were created.

Input name for the line item. This name will appear on the Cost Estimate screen and Cost Estimate report.

This section defines how the values of line items are calculated. Choose from the available options.

Select this option to manually enter line item amount on the cost estimate screen.

Select this option to output tax costs generated by the Equus Engine. Click

and select from the Tax Estimator Output Equus Engine lookup.

For an equalized transfer, create Line Items mapped to these Tax Estimator Outputs:

Note, any line item in a template can be excluded in a specific cost estimate by de-selecting the calculate box for that line item. Therefore, if total employer portion of home country social tax is required for an assignment, de-select the calculate box for Employer Social Tax on Hypothetical Income and the hypothetical amount will be excluded from the total costs of the assignment.

For a gross-up only transfer, create Line Items mapped to these Tax Estimator Outputs:

To include employer social tax on base compensation in the total costs, add the following tax outputs:

To include employer payroll tax on base compensation in the total costs, add the following tax outputs:

Six optional Tax Estimator Outputs are available to capture additional employer tax costs applicable to limited locations.

Note, Equus Engine supports Fringe Benefit Tax in Australia, New Zealand, Philippines, and Zambia

Note, Equus Engine supports Payroll Tax in Australia, Brazil, and France only and Equus Engine supports Fringe Benefit Tax in Australia, New Zealand, Philippines, and Zambia

Note, Equus Engine supports Payroll Tax in Australia, Brazil, and France only.

Vendor subscribed Hypo Calculation currently supported include:

Note, select Prorate and Annualize features for all line items using Hypothetical Tax Calculations.

These can be user created spreadsheet type calculations or business rule type calculations. Use them to automatically compute values for the Line Items with specified source data, including preceding line items on the cost estimate. Contact your Client Account Manager to know more which is suitable to your requirements

Use this feature to specify the user report to source data or to cascade the results of a prior line item as an input into the calculation for the current line item. When using the cascade feature, you can explicitly map line item amounts to calculation input parameters for Compensation/Custom Calculations.

To define the data source, select from the available options displayed on User Report for Input Values lookup. All User Reports with Prompt set to Yes are listed (including company reports for a company template). The User Report will be executed at calculation time, and the results of that user report will be input into any matching calculation parameters. The Column Caption in the User Report must match either the Name or Caption of the Custom Calculation.

To cascade the results of a prior line item, select the prior line item from the Get Value From (Line Item) lookup and select corresponding input from the Input Value to (Calculation Input) lookup. With this mapping, the input parameter fields will not display on the Calc Input tab of the cost estimate screen. The values for these mapped input parameter fields automatically update from the cost estimate. Line items that are calculated using Compensation/Custom Calculations can be inputs to other Compensation/Custom Calculations. You can create a chain of inter-dependent calculations, thus reducing the risk of user error from manual calculation and entry.

Note, you will encounter warning messages when you configure a Calculation and select a Line Item source that appears after, sequentially, in the cost estimate. You must configure Line Items source that appear before, sequentially, to the calculated line item.

You cannot use Tax Estimator Output Line Items as a source Line Item. These Line Items are not displayed in the Get Value From (Line Item) lookup.

The Calculation Input Mapping table appears when you select a specific Compensation/Custom Calculation from the list. This table allows you to explicitly map line item outputs to calculation inputs for the selected calculation. You can only map those Compensation/Custom Calculation inputs that are of a numeric or money type because all line item outputs are monetary in nature. If a line item output is a calculated line item, it must be sequentially ordered above the receiving line item on the template.

Delete

Check Delete and click the [Save] button, to remove a mapping from this Cost Estimate Line Item Compensation/Custom Calculation.

Get Value From (Line Item)

Select a source input value from the lookup for this input mapping. The Source Line Item can be any non-Tax Estimator line in the Cost Estimate Template. When specified, the user entered or calculated result will be provided to the calculation input parameter for the Compensation/Custom Calculation.

Input Value To (Calculation Input)

Select an input parameter that is populated by the corresponding line item output during estimate calculation process.

If any of the Expat4Cast Host tax calculation types is selected, the 'Input Category (Calculation Input)' column will be added on the grid. This input category will support the tax engine for these types of calculations. Note, each category has a specific list of available calculation input (Tax Input).
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Select this option for line item amount to pull from existing Compensation Worksheet. This is the legacy approach to pull data from vendors’ subscribed tables to Cost Estimate Line Item. Use the Compensation/Custom Calculation (new) feature for GROW v.12.3.0 and above.

This option is the legacy approach to support spreadsheet type calculations for cost estimate. Use the Compensation/Custom Calculation (new) feature for GROW v.12.3.0 and above.

You can specify a line item currency that is different than the cost estimates data-entry currency. If used, the selected currency will be the base currency only for the specific line item and exchange rates will be applied based on that currency. Available currency options are:

You can specify an automatic percentage increase of the line item amount for each year of the assignment. If an amount is not entered, no increase will be calculated.

You can specify the month of the year the automatic percentage increase will occur. If a month other than January is selected then the increase will be applied in the selected month and any subsequent months for that year.

Note, the annual increase month can only be selected for calculation types of fixed amount, compensation/custom calculation and compensation worksheet line item type. All other types will use January as the increase month.

For example, if base salary is set to 120 for year 1, the annual increase percentage is 5% and annual increase month is January, then the salary for year 2 and year 3 will be 126 and 132.3, respectively. However if the base salary is set to 120 for year 1, the annual increase percentage is 5% and annual increase month is October, then the salary for year 1, year 2 and year 3 will be 121.5, 127.58 and 133.95, respectively.

The pro-rate feature facilitates calculations for partial and multi-year assignments. You can activate the Pro-Rate feature by selecting the calculate feature box available for each line item on the Cost Estimate.

Select it to indicate that the amount entered or displayed on the cost estimate screen represents the amount for the months in host country. When left unchecked, it indicates the amount entered is for the full year and the line item amounts for the subsequent years will be the same.

For example, months in host country for year 1 and 2 is 12 and 6 months respectively. If you input 120 as annual base salary for year 1 and select the Pro-Rate Based on Months option, year 2 base salary will be pro-rated to 50. If you do not select Pro-Rate Based on Months, year 2 will remain 120.

If workdays are split between home & host the 'Proration Basis' field can be defined. This option determines how the line item is pro-rated:

Note, that for assignments without Work Time Split, there is no difference between the two options.

You should only activate this section for line items to be included in the host and/or home country tax calculation. If no tax input is selected, the line item will still appear in the cost estimate but the relevant amounts will not be included in the tax calculation.

Do not select this section for Line Items mapped to Tax Calculations to output tax costs.

Underlying the Tax Cost Estimate are authority specific templates containing these tax input names. Each tax input of an authority is uniquely configured as taxable or not taxable based on the authority’s tax law. In addition, the tax input may be used to calculate deductions, credits, or fringe benefits tax.

Select from the lookup list the tax input category and name that best match the line item.

The lookup of tax input name is organized into five categories:

Refer to the Equus Tax Engine Guide to Tax Input Names which describes each category and input in detail.

Note, included in the Base Compensation category is the Personal Deductions tax input. This input is not treated as a compensation item but is used to calculate deductions.

Cost estimates calculate hypothetical income, social and state taxes for use in the grossup calculations. In certain scenarios, it may be desirable to use external hypothetical tax values in the grossup calculation. This section details the cost estimate template changes required to support input of hypothetical tax on the Cost Estimate screen.

Identify the cost estimate template to be tailored for hypothetical tax input. If a new template is required, use the template copying feature to create a new template.

From the Cost Estimate Template screen, locate the relevant hypothetical tax line in the Cost Estimate Line Items section.

Select

to open the Line Item Details.

Tax cost line items are mapped to Tax Estimator Outputs. The steps detailed below are designed to change the mapping for the hypothetical income tax lines from an output line to an input line.

Once the configuration is complete, click

.

The figure above displays the desired configurations for the hypothetical income tax input line. Similarly, map the hypothetical social and state tax input lines to Tax Cost Input: Hypothetical Social Tax and Tax Cost Input: Hypothetical State Tax.

Scenarios exist when Expat4Cast does not support the host country and the host tax values may be available from another source. Use the Host Tax Input Tax Estimator to enter the host tax values for the Estimator to calculate the home grossup taxes.

This section details the cost estimate template changes required to support input of host tax on the Cost Estimate screen.

Identify the cost estimate template to be tailored for host tax input. From the Cost Estimate Template screen, locate the relevant host tax line in the Cost Estimate Line Items section.

Select

to open the Line Item Details.

Tax cost line items are mapped to Tax Estimator Outputs. The steps detailed below are designed to change the mapping for the host income tax lines from an output line to an input line.

Once the configuration is complete, click

.

The figure above displays the desired configurations for the host income tax input line. Similarly, map the host social tax input line to Tax Cost Input: Host Social Tax.

From the Host – Country Tax Estimator lookup, select Host Input.

Select

to bring up relevant tax inputs. Choose the appropriate Tax Calculation and Tax Payment options.

This feature is only relevant for the Grossup Only method of calculation, typically used for short term or localization transfers. To determine whether the line item will be included in the tax gross up calculation, select from:

This feature applies to input for each year of the tax input line. The feature applies even when the calculate feature on the Cost Estimate screen is not selected.

NOTE: This feature will only appear if you select <Base Compensation> or <Tax Cost Input> as Tax Input

Use of the Annualize feature offers two different presentations of the total costs: assignment only or 12-months period.

This setting defines which year in a multi-year assignment estimate the input for the line item will appear on the screen. Choose from <all years>, <first year only>, or <last year only>.

Select this feature to exclude the line item from the section and subsection totals within a Cost Estimate. These line items will appear in grey italics on the Cost Estimate screen.

For example, if line item 3 is the sum of line items 1 and 2, then you should select line item 3 to be excluded from section and subsection totals to avoid the value from being added in the totals twice.

Cost Estimate Line Items that have a "Tax Input Name" can now also use the "Excluded from Section and Subsection Total" feature.

When the Personal Deductions tax input is selected from <Base Compensation> category, the "Exclude from Section and Subsection Total" field is automatically selected and cannot be overridden.

Total Cost is the total of all assignment costs including base compensation.

Net incremental costs shows the additional or incremental costs a Company incurs as result of the assignment. It excludes items which are part of the base compensation, or stay at home income.

To exclude the Line Item for Net Incremental Costs, select the Exclude From Net Incremental Cost box.

Select this feature to create a post year input for the line item on the Cost Estimate screen.

Post year tax calculation is available for both tax payment methods, Current Year Grossup and One-Year Rollover. Post year tax calculation is more typically used for the One-Year Rollover method where tax costs from the last year of the assignment are included in the post year compensation for tax calculation. Post year feature should be selected for base compensation line items so appropriate marginal tax rates are applied. Taxes on base compensation are excluded from the reported post year actual taxes.

This feature may also be used for assignment costs incurred in the post year.

This feature is only relevant if the Post Year feature is selected. Select this feature to include the tax input amount in the tax calculation but exclude it from the total costs on the Cost Estimate screen.

For example, select the feature to exclude base compensation of post year from Total Costs to report only assignment relevant costs (i.e. base compensation in the post assignment year is not part of the assignment costs).

The Fiscal Period Reporting Allocation feature enables the specification of a particular reporting allocation method for individual line items. Click on the drop down list next to Fiscal Period Reporting Allocation within each line item configuration to access this. The options available are:

Examples of tax inputs using this allocation method: Bonus and Good and Services Allowances.

An example of a tax input using this allocation method is Tax Services.

An example of a tax input using this allocation method is Housing Costs Host Country.

An example of a tax input using this allocation method: Employee Airfare/Hotel Enroute to Foreign Location.

An example of a tax input using this allocation method: Employee Airfare/Hotel Enroute on Repatriation.

Use this feature to document help text specific to the line item. You can view the text on the Cost Estimate screen by selecting Help for the line item. You can only update the help text from the template level. Character limit is 1000 characters.

This feature is used to document assumptions for the line item. You can view and edit the text on the cost estimate screen by selecting the A for the line item. Bold A represents line items where assumption text exists. Character limit is 1000 characters.

Link to Tax Calculation - Tax Outputs