Accounting for Payroll
Accounting for wages and salaries
- MUST show the full cost to the employer for employing someone
- MUST show the employers liability to the HMRC for PAYE and NIC
Hence 2 main accounts are needed
- The Wages expense account
- The PAYE/ NIC account
Finally a, WAGES CONTROL Account
DOUBLE ENTRY
GROSS WAGES
- DR: Wages Expenses Account
- CR: Wages Control Accounts
EMPLOYEES’s NIC/PAYE
- DR: Wages Control Accounts
- CR: PAYE/NIC
PENSION
- DR: Wages Control Accounts
- CR: Pension
NET PAY
- DR: Wages Control Accounts
- CR: Cash Book
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