Confused as to what is actually being done here

[ian_roberts]

This journal is what QuickFile creates if you have “post net wages to balance sheet only” turned OFF in your settings. I wrote an explanation of this in a reply on another thread a few days ago that may help clear things up

Seeming P&L anomaly

I suspect there’s two things getting mixed up here. QuickFile has two different modes of operation when you tag a bank transaction as a “salary payment”. By default (with the “post net wages to balance sheet only” setting turned off) it uses a simplified mechanism that works for things like small company directors who are paying themselves salary below the NI threshold and therefore don’t have any NI, income tax or other deductions to make. In this mode when you tag a salary payment QuickFile…

Essentially the journal is moving the money twice, from A to B and then from B to C. The fact that B (net wages) is listed in both columns is what makes the debit and credit totals look doubled, but the net effect is still just £120 moving from A to C.