I am probably doing something stupid, and have been through previous posts about recording payroll and cannot see anything obvious
Issue is that after tagging salaries and PAYE in banking correctly, and setting out Journal entry as per Joe’s instructions in posting of aug’13, when reviewing chart of accounts, accounts 7000 and 2200 appear correct [debits] but salaries appear as credits in 7000 and 7001 - can anyone offer an explanation [or preferably a solution!]
When you tag salaries in QuickFile it will perform two journals:
CR Bank (1200)
DR Net Wages (2220)
Then it will move the funds to the Profit and Loss:
CR Net Wages (2220)
DR NET Staff Salaries Paid (7003)
In Account Settings >> Advanced Features, you can set wages to only move to the 2220 (balance sheet), without the additional movement to the P&L. How you set this depends on whether you’re separately importing Payroll journals.
Thanks Glen, but sorry still not sure where I am going wrong.
Using example figures this is what I see in chart of accounts:
7000 8000.00 0000.00
7001 0000.00 1500.00
7003 0000.00 5500.00
2200 7000.00 0000.00
2210 0000.00 0000.00
(1000.00 as PAYE has passed through 2210, but net figure is zero)
Process I follow is;
1 - wages entered and tagged as such in banking (either as directors salary or employee) and PAYE also tagged as PAYE
2 - in monthly journal, appropriate credits entered for 7001, 7003 and 2210 matching figures in 1 above
3 - in same monthly journal, debits entered in 7000 to match net salaries and balancing PAYE
However, this still leaves me with credits in 7001 and 7003 - surely these should be at zero?
Payroll journals are entered rather than importing - should the Post Net Wages… be On or Off?
The journals are explained here, this works on the assumption that your NET wages are getting posted to the profit and loss account.
So in Account Settings >> Advanced Features you’d need to make sure the following is “Off” so that the NET wages are sitting on the P&L code 7003 before the journal is applied.
They should settle at zero yes, whatever you have going into the NET Wages codes gets moved to Gross wages using the journal. If it’s not at zero you must be missing a journal somewhere, also try extending the search range.
I’m not an accountant, so I can only provide general advice, I would therefore recommend you defer to a bookkeeper/accountant for professional advice.
Have managed to resolve things, but wonder if it was caused by doing things in wrong order.
Deleted all payroll journals and bank entries, then re-entered them, Journals first, then banking. Hey presto, all in right place