What is Arrears? | Meaning & Definition | Akrivia HCM

Arrears stand for amounts that are due and payable. In payroll, arrears are payments that are either not made because of employee salary hold or delayed entry of salary revisions. Payroll Arrears is typically designed for an employee’s ‘arrear’ due to the delay in processing the last month’s attendance of employees or due to mistakes in the payroll. The tool satisfies customer needs with a smooth interface and with high-quality features. The Arrears are also calculated on pending salary; if the employee has not been paid for the past month or two months, it will count as an arrear for that period. Most of the payroll or salary of the employee is in arrears, i.e., one month or four weeks from the previous month, and then-current month’s salary is paid.    

While calculating and processing arrears, it is important to understand the nature of arrears. There are mainly two types of arrears: 1) Regular Arrear: Payroll arrears for employee salary for the current payroll period. 2) Advance Arrear: Salary paid to the employee in advance, i.e., deductions not made such as advance salary without deduction of TDS or PF. 

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