Exit payments
When someone leaves, their last month is paid in that month’s run for the days they were employed. Anything extra you owe them, such as pay for unused leave, is recorded as a final payment and paid whole by the next payroll run.
Who can record and withdraw final payments: Owner, HR admin, Payroll admin.
Who can see final payments: Owner, HR admin, Payroll admin, Payroll approver.
Before you start
Section titled “Before you start”The person’s employment has ended. See Offboarding. Final payments are on the ended person’s profile, on the Documents tab, under Final payments.
Record unused leave
Section titled “Record unused leave”Choose Record unused leave. Cadre works out the payment from the person’s leave balance on their last day and the pay in force then. The row shows the days and the daily rate used.
The law sets no daily rate for a leave payout, so Cadre uses its own rule: a year’s taxable earnings (the monthly taxable earnings × 12) divided by 260 working days.
Record another final payment
Section titled “Record another final payment”- Choose Add a final payment.
- Choose the Payment: Compensation for loss of office, Gratuity or Other final payment.
- Enter the Amount in Naira.
- Enter a Description. It appears on the payslip.
- For a gratuity paid under the Pension Reform Act, tick Paid under the Pension Reform Act (tax-free).
- Choose Record payment.
How final payments are taxed
Section titled “How final payments are taxed”Cadre applies current Nigerian law and calculates the tax in the run:
| Payment | Tax |
|---|---|
| Unused leave | Taxed as ordinary pay. |
| Other final payment | Taxed as ordinary pay. |
| Compensation for loss of office | Tax-free up to ₦50 million per person, across all such payments. Only the excess is taxed, in the month it’s paid. |
| Gratuity | Tax-free only when paid under the Pension Reform Act. Otherwise taxed as pay. |
Taxable final payments also count when Cadre checks whether a month’s pay is at or below the national minimum wage.
What happens next
Section titled “What happens next”- The next payroll run for the person’s legal employer includes them, even if they left in an earlier month, for as long as a payment is due. Each final payment is paid whole. It’s never prorated.
- The profile shows the total Due in the next run.
- When that run is locked, the payment is marked Paid.
Withdraw a payment
Section titled “Withdraw a payment”Until the run that pays it is locked, you can Withdraw a payment and give a reason. It won’t be paid. If a draft run already included it, calculate that run again.
A payment made in a locked run can’t be withdrawn. Correct it in a later run. See Correct a locked run.