---
title: "[Legacy] Pay Types: Calculated TDC, Annual Equity, and Refresh Equity"
description: "Overview"
canonical_url: "https://support.pave.com/articles/legacy-pay-types-calculated-tdc-annual-equity-and-refresh-equity-gbaaUSOSxt"
md_url: "https://support.pave.com/articles/legacy-pay-types-calculated-tdc-annual-equity-and-refresh-equity-gbaaUSOSxt.md"
---
# [Legacy] Pay Types: Calculated TDC, Annual Equity, and Refresh Equity

## Overview

Pave now supports advanced compensation structures including **Annual Equity**, **Refresh Equity**, and **calculated Total Direct Compensation (TDC)** to help you benchmark and manage comprehensive pay bands more effectively.

### Understanding the new pay Types

#### Annual Equity

The target equity value an employee should vest over a single year. This is commonly used in TDC calculations and is particularly valuable for companies with unique or shorter vesting schedules.

#### Refresh Equity

The value of non-new hire equity grants received by an employee in the past 12 months. These grants are typically awarded for retention, performance, or other organizational needs.

#### Calculated Total Direct Compensation (TDC)

The complete compensation an employee should receive annually, automatically calculated using this formula:

**Calculated TDC = Cash Components \[Base + Variable + Bonus\] + Annual Equity Value**

### Configuring pay types

#### Step 1: Data Source Mapping


1. Navigate to **Market Pricing** → **Data Sources**
2. Upload your compensation data OR save a Pave datacut
    ![](https://support.pave.com/api/attachments.redirect?id=7adffa3d-99f6-4457-ad0c-86452d2af3b9) 
3. Map relevant fields to TDC, Annual Equity, or Refresh Equity
4. Save your mappings

#### Step 2: Benchmark Jobs


1. Go to **Market Pricing** → **Benchmarking** → **Edit job mapping**
2. Select the new compensation types in your survey mapping group
    ![](https://support.pave.com/api/attachments.redirect?id=0373e67f-2ff8-458c-8e58-87f037337d98) 
3. Save changes and generate matches
4. Review benchmarks and apply any necessary adjustments

#### Step 3: Generate Pay Bands


1. Navigate to **Market Pricing** → **Bands**
2. Select Annual Equity, Refresh Equity, and Calculated TDC in Band Generation
    ![](https://support.pave.com/api/attachments.redirect?id=f515e610-c6be-49bd-8d58-573345fa34f6)  
3. Set min/mid/max values for each compensation type
4. For Calculated TDC:
   * Ranges are automatically calculated based on your cash and annual equity selections
   * If Base + Variable + Bonus are selected, these calculate the "Cash" portion
   * If only Total Pay is selected (without Base), Total Pay becomes the "Cash" portion
   * To include bonus calculations, ensure bonus percentage values are uploaded

\***TDC benchmark values come directly from survey data (not calculated) so you can compare your calculated ranges against market benchmarks\***

#### Step 4: Upload Band Data


1. Navigate to Market Pricing → Bands → Import existing compensation bands. Define your job structure
2. Define your job structure. Click Compensation Types
3. Configure the pay types for the bands. 
    ![](https://support.pave.com/api/attachments.redirect?id=88a52098-1bec-42bc-9fb1-431a59abb025) 
   * TDC is a calculated field based on the cash & annual equity selections (see above).
   * No TDC range values need to be uploaded, since they are calculated.
   * If TDC range values are uploaded, they will be ignored.

#### Edit bands and add pay types

* Compare the calculated TDC range values to the TDC benchmarks directly from the market data.
* The TDC range values cannot be edited directly, but the TDC range values will update when the other values are edited.
* Add new pay types to existing band sets through Settings
   ![](https://support.pave.com/api/attachments.redirect?id=c69bf1fe-5454-454c-af99-abae83a99fd4) 

#### Reminders

* **TDC ranges cannot be edited directly** - they're calculated from cash and annual equity components
* **Don't upload TDC range values** in templates - they're automatically calculated
* **TDC benchmarks come from survey data** - only your calculated ranges are computed by the system

### Frequently Asked Questions

**Q: How is annual bonus included in TDC calculations?** A: If annual bonus percentage is present in your band data, bonus is calculated as Base × Annual Bonus % and included in the TDC formula.

**Q: What if I have both Base and Total Pay values?** A: The system prioritizes Base (plus Variable/Bonus) for calculations. If Base isn't available, it falls back to Total Pay.

**Q: What's the difference between Annual and Refresh Equity?** A:

* **Annual Equity:** Used for benchmarking against standard annual vesting and TDC calculations, common among public companies
* **Refresh Equity:** Discretionary grants for retention, performance, or other specific organizational needs