Revision as of 12:16, 29 December 2009

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 (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 "Nominal Ledger" -> "Journal Entries" -> "Multiple Entry"

Enter a suitable date for the journal e.g. the date the wages were processed.
Follow the steps below and post all entries on the same journal.

Post the 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 e.g. 'Gross M6' and 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>.

Post the Tax

Enter the Wages Control Account centre.
Enter the Total Tax for the period as a positive value.
Enter a comment e.g. '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>.

The above process has the effect of reducing the amount that you owe the employees and showing the Tax figure as an amount you owe 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 e.g. '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>.

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 e.g. '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, e.g. 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.

Now press <Esc> and <Accept> to post the journal.

Posting the Payment of the Wages

Paying the Wages

Go to "Nominal Ledger" -> "Journal Entries" -> "Cashbook Entry".
Enter the Bank Centre (Z992) 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 e.g. 'WAGES PAID M6'.
Press <Esc> and <Accept> to post the journal.

Posting the Payment to HMRC

Paying HMRC

Go to "Nominal Ledger" -> "Journal Entries" -> "Cashbook Entry".
Enter the Bank Centre (Z992) 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 e.g. 'HMRC PAID M6'.
Press <Esc> and <Accept> to post the journal.

Paying money to other bodies e.g. Student Loan Company, Council, CSA and Pension Companies

Go to "Nominal Ledger" -> "Journal Entries" -> "Cashbook Entry".
Enter the Bank Centre (Z992) 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 e.g. Student Loan Deductions.
Enter the amount to pay (do not enter this as a negative value).
Enter the comment e.g. 'STUDENT LN M6'.
Press <Esc> and <Accept> to post the journal.

@@ Line 3: / Line 3: @@
 You should have the following Nominal Centres (or similar) set up in Platinum:
-* Gross Wages (Purchase Ledger Indicator – Overhead)
+* Gross Wages (Profit & Loss Indicator – Overhead)
-* Directors Remuneration (Purchase Ledger Indicator – Overhead)
+* Directors Remuneration (Profit & Loss Indicator – Overhead)
-* Employers NI (Purchase Ledger 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)

Difference between revisions of "How do I post the wages journal?"

Revision as of 12:16, 29 December 2009

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