The simplest way to deal with Payroll entries is to use an integrated product that does it all for you, a full list of our Payroll app is available here. This guidance explains how to do insert a wages journal manually, this will require some knowledge of accounting.
Setting Up
A wages journal requires the following nominal codes;
- Wages Control
- Staff Salaries
- NI Control
- Employers NI
To create these, go to Bank > Bank Codes > +Add the bank code required. We can’t advise on how these should be classified, if your unsure you should consult your accountant.
Creating the Journal
Create a new journal by going to Journals > +Create and call it [Month] wages > Select Wages from the ‘Category’ drop down menu > Click the Create Journal button to proceed.
- Using the Code drop down, select Staff Salaries. Enter the total amount your are paying your staff before tax and national insurance are deducted in the debit column.
- Next, using the Code drop down, select Employers NI. In the debit column enter in the amount of National Insurance you are due to pay for that month for all staff (not inclusive of tax).
- Next, enter in a line using the Code drop down to select Wages Control. In the credit column enter in the total amount you are paying directly to your staff after tax and national insurance has been deducted.
- Finally, use the Code drop down to select NI Control. In the credit column, enter in the combined total of tax + national insurance that you are paying all staff.
You should now have a balanced journal. To save it, click the Save Changes button.
Recording Wage Payments
When recording the wages coming out of your account you need to enter them directly into the bank area and assign them to the nominal Wages Control. Do that by going to Bank > View/Add Transactions next to the account where you’ve made the payment > Use the amount box to enter in the amount of payment > Select Wages Control as the transaction type.
Recording Tax Payments
When you come to pay the TAX & NI again you need to enter this directly into the bank area and this time assign it to the nominal NI Control.
To find out how much you owe you can go to Tools & Reports > General Reports > Trial Balance > Change the date period to whichever you to need to check > Select NI Control. This will provide you with details of how much has been paid in that period and how much needs to be paid.
Please Note: This is a guideline for a simple wages payment journal. Items may differ when including payments such as directors salaries and maternity payments.