When employing someone on a WHM visa they pay a flat rate of 15% tax for the first $45,000, then 30% between $45,001 to $135,000 etc. PR currently calculates their tax based on their gross earnings with us, their current employer. It doesn't take into account any earnings with previous employers and so the employee can easily be under taxed by 50%. If an opening balance was entered, the YTD gross earnings for all employers would be taken into account and the increased tax rate applied more accurately.
For example, our employee had worked elsewhere and had gross earnings of $25K. She earned a further $45K with us. The system taxed all the $45K earned with us at 15% meaning she was under taxed by $3750. If an opening balance of $25K was entered, the first $20K with us would have been taxed at 15% and the remaining $25K would have been taxed correctly at 30%
