Hello Syed,

Please find below step by step explanation:

Step 1: Create / Verify Overtime Work Entry Type

Path: Payroll → Configuration → Work Entry Types

Ensure you have a dedicated Work Entry Type, e.g.:
Name: Overtime
Code: OVERTIME

This Work Entry Type should already be used by the attendance / planning / timesheet flow that generates OT hours.

At this stage, OT hours exist, but they are still merged into payslip.paid_amount.

Step 2: Create a Custom Input Type for Overtime

Path: Payroll → Configuration → Input Types

Create a new Input Type:
Name: Overtime Hours
Code: OT_HOURS
(Optional) Description: Overtime hours coming from Work Entries

This Input Type will act as the bridge between Work Entries and Salary Rules.

Step 3: Convert Overtime Work Entries into Payslip Inputs

This is the key step.

You need to override / extend payslip input computation so that Overtime Work Entries are extracted separately.

Concept:
Loop through Work Entries on the payslip
Filter entries with Work Entry Type = OVERTIME
Sum their duration (hours)
Push the result into the OT_HOURS input

Typical Python Extension (Example)
This is done in a small custom module:

from odoo import models

class HrPayslip(models.Model):
_inherit = 'hr.payslip'

def _get_inputs(self, contracts, date_from, date_to):
inputs = super()._get_inputs(contracts, date_from, date_to)

for slip in self:
ot_hours = sum(
slip.worked_days_line_ids.filtered(
lambda w: w.work_entry_type_id.code == 'OVERTIME'
).mapped('number_of_hours')
)

if ot_hours:
inputs.append({
'name': 'Overtime Hours',
'code': 'OT_HOURS',
'amount': ot_hours,
'contract_id': slip.contract_id.id,
})

return inputs

Result: OT hours are now explicitly available as an Input, instead of being hidden inside Basic Salary.

Step 4: Create a Dedicated Salary Rule for Overtime

Path: Payroll → Configuration → Salary Rules

Create a new rule under the appropriate structure (e.g. Earnings):

Name: Overtime
Code: OT
Category: Allowance / Overtime (AU-specific category if required)
Condition:
Input
Input Code = OT_HOURS

Salary Rule Computation
Example (hourly OT rate already defined on contract):

result = inputs.OT_HOURS.amount * contract.overtime_rate

Or if OT is a multiplier:

result = inputs.OT_HOURS.amount * contract.wage * 1.5

Step 5: Ensure Overtime Is Excluded from Basic Salary

To avoid duplication:
Make sure Basic Salary rule only uses:
Normal worked hours
NOT payslip.paid_amount if OT is included there
If needed, adjust Basic rule logic to exclude OT Work Entry Types

This guarantees OT is paid once and only once.

Step 6: Enable YTD Tracking for Overtime

In the Overtime Salary Rule:

Ensure:
“Show on Payslip” = ✅
Rule has its own unique code (OT)
Category is consistent across periods

Odoo automatically:
Aggregates rule results by code
Displays Year-to-Date (YTD) totals on the payslip

No extra YTD logic is required once OT is a standalone Salary Rule.

Hope it helps.