Sage help - staff salaries
Discussion
We moved over to Sage a few months ago, but still do our Payroll on Quickbooks and I don't know how to post the journals to show them in our P&L and B/S so it's right at the end of our financial year.
At the moment, I've been posting the actual staff payments from the bank (nominal 1200) to nominal 7003 (staff salaries) so I can reconcile my bank statements.
How should I post the staff salaries? (which nominals)
I need to post:
Gross Wages
Employer/Employee NI
PAYE
Nett Wages
Please explain it in idiot terms. Thanks in advance
At the moment, I've been posting the actual staff payments from the bank (nominal 1200) to nominal 7003 (staff salaries) so I can reconcile my bank statements.
How should I post the staff salaries? (which nominals)
I need to post:
Gross Wages
Employer/Employee NI
PAYE
Nett Wages
Please explain it in idiot terms. Thanks in advance
There is a "correct" way to post wages transactions - which is a general rule, not just applicable to Sage.
Dr - Gross Wages per wages records to P & L "Wages" Heading
Dr - Employers NI element to P&L "Social Security" heading
Cr - Net Wages per wages records to "Net Wages Control Account" in the Balance Sheet
Cr - PAYE/NIC due per wages records to the PAYE/NIC control account in the balance sheet
When posting the bank payments, the net wages payments are debited to the Net Wages Control Account and the HMRC PAYE and NI payments are posted to the PAYE/NIC Control Account.
In theory, once all these postings have been made, both the Net Wages Control Account and the PAYE/NIC Control Account should show a Zero Balance each.
Dr - Gross Wages per wages records to P & L "Wages" Heading
Dr - Employers NI element to P&L "Social Security" heading
Cr - Net Wages per wages records to "Net Wages Control Account" in the Balance Sheet
Cr - PAYE/NIC due per wages records to the PAYE/NIC control account in the balance sheet
When posting the bank payments, the net wages payments are debited to the Net Wages Control Account and the HMRC PAYE and NI payments are posted to the PAYE/NIC Control Account.
In theory, once all these postings have been made, both the Net Wages Control Account and the PAYE/NIC Control Account should show a Zero Balance each.
Hello again. Sorry for not replying to this sooner, but I've only just got round to looking at it!
I have put the Journal Entries onto a spreadsheet, so I can easily see which nominals to debit or credit (thank you very much for the information).
I have one problem though, I can't get my journal to balance, and the amount it's out by is the gross wages amount. If I post a debit to the P&L, where does the credit get posted to?
I have put the Journal Entries onto a spreadsheet, so I can easily see which nominals to debit or credit (thank you very much for the information).
I have one problem though, I can't get my journal to balance, and the amount it's out by is the gross wages amount. If I post a debit to the P&L, where does the credit get posted to?
If you followed my instructions above, the debits and the credits should come to the same total.
An example
Posting of the basic wages details
Gross Wages - DR £10,00.00 to Gross Wages Heading in the P & L
Employers NI - DR £2,000.00 to Employer's NI heading in the P & L
PAYE and NI Payable to HMRC - CR £4,000.00 to PAYE Control a/c Bslance Sheet
Net Wages Payable to Staff- CR £8,000.00 to Net Wages Control Account Balance Sheet
Posting of the actual wages and PAYE payments
Net Wages Payments to staff - DR £8,000.00 Net Wages Control a/c
PAYE/NIC Payment - DR £4,000.00 to PAYE/NIC control a/c
Being bank payments, the credit entry for these payment transactions is to the Bank Account.
An example
Posting of the basic wages details
Gross Wages - DR £10,00.00 to Gross Wages Heading in the P & L
Employers NI - DR £2,000.00 to Employer's NI heading in the P & L
PAYE and NI Payable to HMRC - CR £4,000.00 to PAYE Control a/c Bslance Sheet
Net Wages Payable to Staff- CR £8,000.00 to Net Wages Control Account Balance Sheet
Posting of the actual wages and PAYE payments
Net Wages Payments to staff - DR £8,000.00 Net Wages Control a/c
PAYE/NIC Payment - DR £4,000.00 to PAYE/NIC control a/c
Being bank payments, the credit entry for these payment transactions is to the Bank Account.
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