Payroll Exclusions In A Commercial Audit
Now that we have covered what is included in payroll, let’s talk about what is excluded from payroll. There are a number of costs that are typically excluded when payroll is calculated for the purpose of rating workers compensation insurance and generally include the following:
- Tips and other gratuities received by employees over minimum wage
- Severance pay (other than for time worked)
- Discounts on goods purchased from the employer
- Reimbursed business expenses
- Pay for active military duty
- Uniform allowances
As I mentioned in the previous video, we know that the conversation around payroll is a complex one. Don’t hesitate to reach out to us with your questions.
See our sixth video on business audits.