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• # 83291
• Tue 19 Jun 2012 02:37 PM

Hi, I have started with a new client and the payroll has been done externally.  The person doing the accounts has been using Bank Payments and 7001 for Directors Salary and 7001 for staff and then another bank payment to 2210 when they pay HRMC.  Now they have a bookkeeper, and the Accountant has asked me to do Payroll Journals for the last few months.  I plan to do the following monthly Jnls

Dr 7001 Gross Directors Sal
Dr 7003 Gross Staff Sal
Dr 7006 Er NI

Cr 2220 Net Wage
Cr 2211 Ee & Er NI
Cr 2210 Tax

3 questions:

1. Does this sound OK.

2. When I process bank payments - I debit amount to 2220 (net wage)?

3. What do I do with all the previous payments made out of 7001 and 7003 - can I reverse them and set up the Jnls and re-do the Bank Payments?

Advice and suggestions would be gratefully accepted.

Thanks

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• # 83296
• Tue 19 Jun 2012 05:09 PM

Hi Ann

1. The journal is ok except for: why post the NIC to a separate account when the payment is made to HMRC as one payment? I CR 2210 with the PAYE & NIC due. I know Sage has it separated out, but I think that harks back to a time when they were paid separately. 

2. Yes, DR 2220.

3. It looks like the journals have not been done at all & that the net pay has been posted to 7001 & 7003 instead of the gross figures, which is wrong as the accounts should have the gross figures in. I suggest you tell the accountant, but tell him that the figures can be corrected by going back to the start of the current accounts year & doing all the payroll journals as in 1. above. You will then need to go to print off nominal activites for 7001 & 7003. Then go to "Company", "Make Corrections", find the transaction numbers (from the activity printoff), go to "Edit" & change the nominal code from 7001 & 7003 to 2220.

I hope this helps!

Kind regards

Hazel



Edited at 19 Jun 2012 05:10 PM GMT

Edited at 19 Jun 2012 05:11 PM GMT

• Hazel

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