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When wages are either wrong or delayed in a previous pay period, an employee might receive a retro payment. It involves handling increases in pay without a raise, changes in the time worked or job role changes. Usually, these payments happen after some issues such as contract negotiation or errors, are resolved. Should a bonus meant for December get wrongly missed in your paycheck, it would be given to you at a later date in the form of a retro payment. Accurate recording and adding these adjustments to the tax reports is required by employers.

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