To do this, follow the below-mentioned steps -
Under Settings, click on Settings and click on the Payroll for Payroll settings.
Expand the Allowances tab and click on Add New
Create a new category for your salary allowance as needed.
Once done and saved, the list of allowance categories will be visible while editing an employee's basic salary configuration as shown below:
Allowance assigned to employees will be visible on an employee's Active Payroll Month under the Payroll tab on their profile (also accessible by clicking on an employee row on the payroll table).