Join BKN

Join BKN
Join BKN

Bookkeeping Hall of Fame

Join BKN

Post Info TOPIC: Sage 50 Accounts - Wages Journal Entries


Veteran Member

Status: Offline
Posts: 43
Date:
Sage 50 Accounts - Wages Journal Entries


Hi all

Hope you are keeping well.

Ok i am doing my first Journal entries for wages in Sage. I have attached a word doc screenshot for you to view.

Is this correct or do i need to add ER NI somewhere?

In Bank/Payment i did single entries for Net Wages, ER NI, EE NI and PAYE.

Thanks for reading.

Paul


-- Edited by djzolla on Wednesday 2nd of February 2011 08:28:21 PM

Attachments
__________________


Expert

Status: Offline
Posts: 1501
Date:

You would need to post your ERSNIC to somethin like 7001 and your NI Liability account 2211 should be EESNIC like you have got plus your ERSNIC.


Gross pay 7000 1764.71 DR
ERSNIC     7001     20.00 DR (As an example only)
Net pay     2220                    1377.95 CR
PAYE         2210                     245.00 CR
NIC           2211                     161.76 CR (141.76 + 20.00)
Total                  1784.71       1784.71

-- Edited by Rhianrach on Wednesday 2nd of February 2011 08:57:49 PM

__________________
Steve



Senior Member

Status: Offline
Posts: 384
Date:

Just to confirm Sage Recommendation on Employers NI is 7006

Debits
Gross Pay = 7000
Employers = 7006
SMP = 7011
SSP = 7010
Credits
Total NI to be paid = 2211
PAYE = 2210
Net Wages = 2220


If using Sage payroll system you can ofcourse set system to enter journal for you - Company / nominal settings

good luck


__________________

 

Donna - Complete Book-Keeping Ltd & CBK Training - 07939 101900

Payroll & bookkeeping solutions.

www.completebookkeeping.co.uk / www.cbktrain.co.uk



Veteran Member

Status: Offline
Posts: 43
Date:

Hi Donna

Sorry you have totally confused me now:) sorry i am still new to all of this and don't understand what you mean

What is SSp and SMP please?


-- Edited by djzolla on Friday 4th of February 2011 11:33:37 PM

__________________


Senior Member

Status: Offline
Posts: 201
Date:

Hi Paul
SSP is Statutory Sick Pay
and SMP is Statutory Maternity Pay.

Looking at Donna's Sage enteries:

 
I thought SSP and SMP figures should be credits rather than debits when journaling to the ledger as they are recoverable amounts from HMRC and thus reduce PAYE/NI liability to HMRC.  

the gross salary figure would contain gross amounts to the person on sick  (or maternity) leave.  

Dalbir

 



__________________

EalingMA in partnership with Arithmo Accounting Software for small business.

From £20 plus Vat per client per annum; No more excuses for small business owners and their accountants in managing their books on spreadsheets.



Senior Member

Status: Offline
Posts: 384
Date:

Apologies shouldnt have posted in such hast while in bed with cold.

you are correct, SSP/SMP are Credits
I had broken down into PNL & BS rather than debit / credit

N/C Name Debit Credit
7000 Gross Wages
The total of gross wages for all employees. Debit
7006 Employers NI
The total employer NI contributions. Debit
2210 PAYE
The total PAYE deducted. Credit
2211 National Insurance
The total employer and employee NI contributions.
Note: If you receive an employee or employer NI rebate, the value should be posted to this nominal code as a debit. Credit
2214 Student Loans
If applicable, the total of student loan deductions made. Credit
2215 Attachments
If applicable, the total of attachments deducted from employees net pay. Credit
2216 Deductions
If applicable, the total of remaining employee deductions, excluding attachments, and student loans. Credit
2220 Net Wages
Total net wages, that is the total of employees' take home pay. Credit
If your payroll includes pensions you need to post the following two entries:
2230 Pension Fund
Total employer and employee pension contributions. Credit
7007 Employers Pensions
Total employer pension contributions. Debit
If your payroll includes SSP, SMP, SPP or SAP Reclaimed you need to post the following entries:
7010 SSP Reclaimed
Total SSP reclaimed. Credit
7011 SMP Reclaimed
Total SMP Reclaimed. Credit
7012 SPP Reclaimed
Total SPP reclaimed. Credit
7013 SAP Reclaimed
Total SAP reclaimed. Credit
2211 National Insurance
Total SSP/SMP reclaimed. Debit


__________________

 

Donna - Complete Book-Keeping Ltd & CBK Training - 07939 101900

Payroll & bookkeeping solutions.

www.completebookkeeping.co.uk / www.cbktrain.co.uk



Veteran Member

Status: Offline
Posts: 43
Date:

Hi there

When i debit the bank account do i breakdown the EE NI and ER NI for payment? Generally I have been making 4 payments from the bank area namely, EE NI, ER NI, PAYE and Net wages. Is this the correct way of doing things?

__________________


Senior Member

Status: Offline
Posts: 201
Date:

Hi Paul

There are two routes I advise Arithmo users who have asked about journaling payroll to do:

(1) set up a PAYE/ NI balance sheet account.

at point of payroll, CR PAYE/NI account

when you pay HMRC after payroll month, do a journal DR PAYE/NI and Cr Bank.


or

(2) CR Bank PAYE/NI and not use PAYE/NI control account. At end of month when doing the bank rec; leave as unreconsiled item and reconcile the entry next month when you physically pay HMRC (before 22nd of the next month- if paying HMRC electronically).

Dalbir

__________________

EalingMA in partnership with Arithmo Accounting Software for small business.

From £20 plus Vat per client per annum; No more excuses for small business owners and their accountants in managing their books on spreadsheets.



Member

Status: Offline
Posts: 19
Date:

Hi Donna, I have been using sage for coming up to a year now but have never needed to deal with SPP until now. I found your breakdown of all the n/c accounts and debits/credits extremely useful! on our payroll summary the employee with SPP had a 'discount' from their normal gross wage for the two weeks they were off. Our payroll summary shows us claiming back the SPP they receive and the NI ascociated with it. So do i need to set up a new N/C i.e. 2216 Deductions for this 'discount' and an 'SPP reclaimed' N/C? Also when i post the SPP and discount to the relevant N/Cs how do i then clear these? normally the PAYE & NI N/Cs and wages control acc are cleared when i put throught the bank what we paid over to HMRC and the wage payments? many thanks

__________________
Kim Ellison


Guru

Status: Offline
Posts: 1405
Date:

Hi Kim,

Is the "discount" just a deduction from their normal gross SPP or is it something that has to be paid to HMRC? If it is just a deduction from the gross pay then I would just enter the gross figure less the deduction in N/c 7000 Gross wages.

You will need to set up or rename a N/c in the 701x range for the SPP reclaimed. You won't need to clear them as the opposite entries are posted as debits to your PAYE & NI Ctrl account nominal, thus reducing the balance subsequently paid to HMRC.

The SPP journal will be something like this:-

Debits
2210 PAYE & NI Ctrl (SPP recl & NI comp)

Credits
701x SPP reclaimed
701x NI compensation

The amount of SPP itself is included in the gross wage figure as a debit.

Hope this makes sense.

Pauline

__________________

Pauline



Member

Status: Offline
Posts: 19
Date:

Hi Pauline,

Thank you ever so much! Your explaination makes perfect sense.

The deduction was on their normal gross wage to remove 2 x weeks of their normal wage and then in place they received 2 x weeks of SPP. So do you suggest putting their gross wage less the deduction + the total SSP into the gross wage N/C?


I will set up two new N/C for:
701x SPP reclaimed
701x NI compensation

as you have suggested and put the debit sides to the PAYE & NI control.

Many thanks again for your help.

x x x

__________________
Kim Ellison


Guru

Status: Offline
Posts: 1405
Date:

No problem Kim. Why did you have to remove 2 weeks of their normal wage? Can you not just delete the employee's normal wage and then enter the SPP when you are maintaining the employee's pay for the period? I have used Sage Instant for payroll, so don't know if you are using this or Sage 50?

Pauline

__________________

Pauline



Member

Status: Offline
Posts: 19
Date:

Hi pauline, We have our payroll prepared externally then i just put it through sage 50 and pay it using the payroll summary and hmrc remittance from the accountants. Does that alter your previous advice? Or can I just post the spp as you suggested? X

__________________
Kim Ellison


Guru

Status: Offline
Posts: 1405
Date:

Hi Kim.....no that doesn't alter my advice.....go ahead and post as I suggested 

Pauline



__________________

Pauline



Member

Status: Offline
Posts: 19
Date:

Hi pauline, I have posted the wages as per your instructions, paye and NI accounts and wages control are now showing the corrrect balances. Really appreciate your help. Many thanks again! X x x

__________________
Kim Ellison


Guru

Status: Offline
Posts: 1405
Date:

No problem 

Pauline



__________________

Pauline



Member

Status: Offline
Posts: 6
Date:

Hi Pauline and Donna,

This thread has been very useful to myself as well. I am now responsioble for all payroll in my new company role, and , albweit have done the journals before there are always new areas to cover when they crop up. One of these is Student Loans.

Now this is automatically calculated through Sage 50 payroll and deducted from the employee, then when I press the FPS to HMRC the P32 shows me how much to pay to HMRC and this is I do (by 22nd of following month).

My question however is the journals for student loans. This has only cropped up over the last few months and I just don't know where to post them to clear my BS and then post to P&L...am I right ? Is this a dumb question or should they go to something like gross wages ?

Cheers

Matt



__________________


Member

Status: Offline
Posts: 6
Date:

btw i do have the 2210 (PAYE/NI) account on the balance sheet and this does seem to be out by the student loans and so assume the above is correct but would like this clarified for peace of mind

Having re-visited the part 1 and part 2 payroll reports for month X, I can see the student loan column....and looking at 2210 rec for month X I can see that the latter is out (compared to what the P32 report said I should pay to HMRC) by the student loan amount.   I therefore feel I need to CR 2210 with the student loan amount to reconcile this account....but where do I post the DR ? 



-- Edited by Mattyb on Friday 19th of July 2013 05:18:05 PM

__________________


Guru

Status: Offline
Posts: 1344
Date:

The student loan deduction would hit net wages (dr) and PAYE (cr)

I personally post to 2210 for NIC - so that what you have at the end should match what you are about to pay.

HTH

__________________

Michelle, Fox Accountancy Services

Thoughts are my own and not to be regarded as official advice

www.foxaccountancyservices.co.uk     @FoxAccounts

BKN WINNER - Most Innovative Accounting Firm 2013



Member

Status: Offline
Posts: 6
Date:

many thanks for the answer Michelle

Another quick question regards to CAPS (Centralised Attachment of Earnings and Payments System), paying £75 per month from an employees salary. Can you advise of the journal entries for this ?

Final question (hopefully) can you advise on SSP. Looking at the above it mentions 7010 SSP RECLAIMED, firstly how do you go about reclaiming this from HMRC ? How much of the monthly payment can you reclaim ? Until I go ahead and reclaim do I still post to this nominal or should an alternative be used to such time as I do reclaim ? Can you also advise of the journal entries too ?

Many thanks for all your help. I think these forums are fantastic for people to voice their questions and get expert advise


Matt (a very happy bunny now !)



-- Edited by Mattyb on Monday 22nd of July 2013 09:06:31 AM

__________________


Guru

Status: Offline
Posts: 1344
Date:

Matt

You will deduct the Attachment like the student loan (so DR net wages) and then you would post the attachment to its own creditor account. (I rename 2211) Then when you pay that money out, to whoever its owed to, the bank payment would DR the CR you posted in 2211

So, £75 for council tax would DR net wages and CR 2211
Then the bank payment to the council would CR bank and DR 2211, clearing it to NIL

I don't know much about payroll, but from my understanding... SSP is calculated, but not all of it can be claimed back. The percentage that can be claimed is used to reduce the liability for the month, so you pay less. If no liability for the month is due, you hold it on account until a liability becomes due. If a liability never becomes due, the P35 shows the money is owed to you and you get a refund.

It is this percentage that needs to go into Sage. DR 2210 and CR SSP reclaimed on the P&L.



-- Edited by FoxAccountancyServices on Monday 22nd of July 2013 09:55:13 AM

__________________

Michelle, Fox Accountancy Services

Thoughts are my own and not to be regarded as official advice

www.foxaccountancyservices.co.uk     @FoxAccounts

BKN WINNER - Most Innovative Accounting Firm 2013



Guru

Status: Offline
Posts: 1405
Date:

Hi Matty,

Statutory Sick Pay can now only be reclaimed if the total amount of SSP paid in a tax month is greater than 13% of the gross Class 1 NI (Er's and Ee's) liability for that tax month.

If you have employees who earn above the LEL and so qualify for SSP, but are below the threshold for Class1 contributions, it could mean that you have no class 1 contributions due that month and so will be entitled to reclaim all the SSP paid.

__________________

Pauline

Page 1 of 1  sorted by
 
Quick Reply

Please log in to post quick replies.

Tweet this page Post to Digg Post to Del.icio.us
Members Login
Username 
 
Password 
    Remember Me  

BKN Special Offers

 

Resources

Careers & Qualifications  Start Up Essentials  Marketing Centre   Software Reviews
What is a book-keeper  Register as Self-Employed Networking  Software Blog
 Home Study Courses  Money Laundering Local Accountants  
 Qualifications/ Associations  Data Protection Direct Marketing  
 Franchises  Registering as an agent  Telemarketing  
 College / Night School  PI Insurance  Directories  
 Recruitment  Stationery  Google  
     Twitter  
     Volunteer Work  

 

 

 

 

 
 

 
   

 

Copy Right Bookcert Limited