How do I post the wages journal?

Summary

The following article explains how to post a wages journal using Journal Entries. You should have the following Nominal Centres (or similar) set up in Platinum:

• Gross Wages (Sales,W/S,Parts etc) (Profit & Loss Indicator – Overhead)
• Directors Remuneration (Profit & Loss Indicator – Overhead)
• Employers NI (Profit & Loss Indicator – Overhead)
• Wages Control Account (Balance Sheet Indicator – Asset/Liability)
• PAYE & NI Control Account (Balance Sheet Indicator – Asset/Liability)

More Information

There are three journals to carry out when dealing with wages:

• First - to post the payroll costs, i.e. the Gross Wages and Employers NI.
• Second - to transfer the money out of the bank account when you actually pay the employees.
• Third - to transfer the money out of the bank when you pay the Inland Revenue.

Posting Payroll Costs

Go to " Accounts\Systems Nominal Ledger Journal Entries Multiple Entry."

• Enter a suitable date for the journal.

The date the wages were processed.

• Follow the steps below and post all entries on the same journal.

Gross Wages

• Enter the centre for Wages. If you would like to split the wages into departments or separate Directors pay from employees then enter the appropriate centres.
• Enter the Total Gross Pay for the appropriate centre as a positive value.
• Enter a comment.

'Gross M6'.

• Press <Enter>.
• Enter the Wages Control Account centre and post the same Total Gross Pay again, but this time as a negative value.
• Press <F6> on the "Comment" field to pick up the same comment as above and then press <Enter>.
• Repeat as necessary if you are splitting Gross Wages into departments.

Tax (PAYE)

• Enter the Wages Control Account centre.
• Enter the Total Tax for the period as a positive value.
• Enter a comment.

'Tax M6'.

• Press <Enter>.
• Enter the PAYE & NI Control Account and post the Total Tax as a negative value.
• Press <F6> on the "Comment" field to pick up the same comment as above. Press <Enter>.

This reduces the amount that you owe to the employees by the Tax figure since you owe this to HMRC.

Employees National Insurance

• Enter the Wages Control Account centre.
• Enter the Total Employees' National Insurance for the period as a positive value.
• Enter a comment.

'EE NI M6.' Press <Enter>.

• Enter the PAYE & NI Control Account and post the Total Employees' National Insurance as a negative value.
• Press <F6> on the "Comment" field to pick up the same comment as above. Press <Enter>.

This reduces the amount that you owe to the employees by the Employees National Insurance figure since you owe this to HMRC.

Employers National Insurance

• Enter the Employers NI centre.
• Enter the Total Employer’s National Insurance for the period as a positive value.
• Enter a comment.

'ER NI M6'.

Press <Enter>.

• Enter the PAYE & NI Control Account and post the Total Employer’s National Insurance again as a negative value.
• Press <F6> on the "Comment" field to pick up the same comment as above. Press <Enter>.

Post any other values appropriately.

Tax Credits should be posted as a debit (positive) to the PAYE & NI Control Account and as a credit to the Wages Control Account; Pensions deducted after tax could debit Wages Control and credit Pension Control; Student Loan Deductions could debit Wages Control and credit Student Loan Control etc.

• Press <Esc> and <Accept> to post the journal.

Posting the Payment of the Wages

Paying the Wages

• Go to " Accounts\Systems Nominal Ledger Journal Entries Cashbook Entry."
• Enter your Bank Centre and press <Enter>.
• Enter 'O' (Out) at "Money In/Out" as you are paying money out of the bank account. Press <Enter>.
• Enter the date you are paying the money out.
• Enter the Wages Control Centre.
• Enter the amount to pay (do not enter this as a negative value).
• Enter the comment.

'WAGES PAID M6'.

• Press <Esc> and <Accept> to post the journal.

Posting the Payment to HMRC

Paying HMRC

• Go to " Accounts\Systems Nominal Ledger Journal Entries Cashbook Entry."
• Enter your Bank Centre and press <Enter>.
• Enter 'O' (Out) at "Money In/Out" as you are paying money out of the bank account. Press <Enter>.
• Enter the date you are paying the money out.
• Enter the PAYE & NI Control Centre.
• Enter the amount to pay (do not enter this as a negative value).
• Enter the comment.

'WAGES PAID M6'.

• Press <Esc> and <Accept> to post the journal.

Paying Money to Other Bodies

Student Loan Company, Council, CSA and Pension Companies.

• Go to " Accounts\Systems Nominal Ledger Journal Entries Cashbook Entry."
• Enter your Bank Centre and press <Enter>.
• Enter 'O' (Out) at "Money In/Out" as you are paying money out of the bank account. Press <Enter>.
• Enter the date you are paying the money out.
• Enter the relevant code to which you have been posting the payroll details.

Student Loan Deductions.

• Enter the amount to pay (do not enter this as a negative value).
• Enter the comment.

'WAGES PAID M6'.

• Press <Esc> and <Accept> to post the journal.

See also

• How do I Run a Payroll Period?
• Posting Journals
• Posting Cashbook entries
• What is a Nominal Code?
• Recommended Accounting Routines

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Keywords AND Misspellings

wages, journal, HMRC, gross, PAYE, national insurance