To ensure a tax deduction element credits the same account for all employees irrespective of home department, which costing option should be used?

• A. Create costing with distributed option.
• B. Create costing with Costed option on tax element.
• C. Create Fixed Costing on tax deduction element.
• D. You cannot meet this requirement.

Answer: (C)

The key idea is how payroll elements map to GL accounts through costing. If you want a tax deduction to post to the same GL account for every employee regardless of their home department, you should use fixed costing for that element. Fixed costing locks the posting to a single, predefined accounting combination, so every employee’s deduction credits the same account.

Using a distributed costing option would base postings on each employee’s cost distribution (such as by home department), leading to different accounts for different employees. The “costed” option on a tax element still relies on the element’s cost distribution rules and can vary by employee cost objects, so it doesn’t guarantee a single shared account. Therefore, fixed costing is the correct choice to meet the requirement.