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Salary payments categorised under type 'Money Paid to User' and 'Net Salary and Bonuses' do not show as a loss on the Profit & Loss statement
But they do show as a loss when I categorise them as type 'Payment' with category 'Net Salary Expense'. Is it okay to do it this way? Or should I really be creating payslips for each salary payment?
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Inappropriate?David,
You can do either - but creating payslips lets you track the amounts owed to the employee and HMRC (PAYE and NI payments) and is more accurate from an accounting point of view. It's the payslips themselves that give rise to the P&L entries, the bank transactions just settle the amounts owing to the employee etc.
If you use the Payment > Net Salary Expense and Payment > PAYE/NI Expense categories your accountant may need to adjust for payments happening in the 'wrong year'.
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Thanks for the explanation Ed. I've gone with 'Payment > Net Salary Expense' for this tax year (with my accountants blessing) as it saves time. -
Inappropriate?I have created a payroll and then classified the outgoing payments as "Net Salary Expense". The problem is that the staff cost now shows up twice in the Pnl. Once as Salary and another time as salary expense.
How do i need to classify the actual salary payments on the bank statement?
I’m excited
EMPLOYEE
