What is 'wage type' in SAP PY - Payroll?

wage type - Overview

• Component: PY

• Component Name: Payroll

• Description: Object in and Personnel Administration in which the user or the system stores amounts and time units that are used, for example, for calculating pay or for determining statistics. Wage types separate amounts and time units for various business purposes. This also enables the system to process amounts and time units in different ways during the payroll run.

wage type - Details

• 
  Key Concepts: 
  A wage type is a code used to identify a specific type of wage or salary payment in SAP Payroll. It is used to differentiate between different types of payments, such as regular wages, overtime, bonuses, and other types of compensation. Wage types are also used to calculate taxes and deductions. 
  
  How to use it: 
  In SAP Payroll, wage types are used to define the different types of payments that an employee can receive. They are also used to calculate taxes and deductions. To create a wage type, go to the “Payroll” tab in the SAP system and select “Wage Types” from the menu. Enter the details of the wage type, such as the name, description, and calculation method. Once saved, the wage type will be available for use in payroll calculations. 
  
  Tips & Tricks: 
  When creating a wage type, it is important to ensure that all relevant information is entered correctly. This includes the name, description, and calculation method. It is also important to ensure that the wage type is assigned to the correct payroll area and personnel area. 
  
  Related Information: 
  For more information on SAP Payroll and wage types, please refer to the SAP Help Portal or contact your local SAP support team.