Hi - in the purchase invoice catergory list there are options mssing that i need to use - does anyone know if i can add other catergories or if not how to get them added??
Hi @andywinship
The categories are pulled from your Chart of Account (under Reports). You can certainly add additional ones if needed, and they can be used for your purchase invoices.
Im lost (but thanks for reply) when i go in there to add “wages” as a purchase option it says category already exists which it does on the list but when i create a purchase “wages” does not show on the categories drop down list - am i missing something??
And if use the “help me choose a category” and type in “wages” it doesnt come up with a match??
Hi @andywinship
Wages shouldn’t be entered as a purchase so this nominal code isn’t available through this method. It’s a similar situation for NI, PAYE etc.
What type of wages are they - are they from a PAYE scheme paid to an employee, drawings (for a sole trader or proprietor) or a repayment of a director’s loan?
I need PAYE wages, directors loan repayments, vehicle leasing, purchases of materials, purchase of equipment, Subcontractor payments as categories according to my bookkeeper
Wages and DL repayments aren’t purchases, that’s why they’re not available as a category on purchase invoices. Wages paid through PAYE are usually dealt with via journals, and DL repayments are simply bank transfers into the director’s loan “bank” account.
Vehicle leasing you could add under the “overheads” category, purchase of materials would be “general purchases” (buying things to sell, or to use as part of an identifiable sale rather than just as a general overhead of the whole business), purchases of equipment I’d use the existing asset codes or create new ones if “plant and machinery” and “office equipment” aren’t specific enough, and sub-contractors already exists as a direct expenses code.
Thanks for the help i appreciate it - so when paying wages you dont create a purchase for that? So how do you enter it into the software?
When you run your payroll you should get a breakdown out of your payroll software telling you all the relevant “costs” to your business (gross wages, employer’s NI contributions, employer’s pension contributions), any deductions from the gross wages (tax, employee NI, employee pension contributions, etc.) and the final net pay. From these numbers you can enter a journal on the pay date to debit the cost codes and credit the liability codes
- debit gross wages/director salaries (7000/7001)
- debit employer’s NI (7006)
- debit employer pensions (7007)
- credit PAYE (2210) for everything you owe HMRC - tax, employer and employee NI, any student loan deductions, etc
- credit Pension fund (2230) for all pension liabilities - employer contributions and employee deductions
- credit net wages (2220) for the remainder, the net pay that actually goes to the employees/directors
Under “account settings” -> “advanced features” I recommend you switch “post net wages to balance sheet only” to “ON”.
Now when you actually pay the employees you tag it as “salary”, when you pay HMRC you tag it as “tax payment” -> “PAYE liability”, and when you pay the pension company you use “something not on the list” and select “pension fund”.
Just to add to what @ian_roberts has mentioned, we have a guide with an example on the payroll journal, in our knowledgebase. Hopefully this will help: Recording payroll
Thank you both ! appreciate the guidance
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