Employee deductions

Options
Nadine
Nadine Member Posts: 52 ✭
edited July 2020 in Reckon Accounts (Desktop)
We have employees who we have purchased tools for and they will pay us back via a deductions from their net wages. I have tried to set this up by linking a payroll deduction to an employee loan as an asset account as per previous suggestions on the forums but the system won't let me use a payroll account outside of payroll. 

Is there a work-around for this?

I am using Reckon Accounts Premier desktop.

Comments

  • Nadine
    Nadine Member Posts: 52 ✭
    edited June 2018
    Options
    You can't use any of the payroll items in general journals, or supplier bills or invoicing so trying to find a way to clear the default liability account outside of payroll is very difficult is what I mean. It has been suggested to me to set up a payroll clearing account as a bank account and I think that will work.  
  • John Graetz
    John Graetz Member Posts: 1,651 ✭✭✭
    edited July 2020
    Options
    Nadine.  What General Ledger account do you have the deduction going to?  If you were to set up a separate Payroll Item for each employee who has a loan, you could direct the deduction to go to that individual's  Loan Account (Asset Account) and you would not have any further action to take and you could see at a glance what the current balance of the account is.
    John L G
  • Graham Boast
    Graham Boast Accredited Partner Posts: 331 Accredited Partner Accredited Partner
    edited July 2020
    Options
    Hi Nadne,

    I think this is the issue you are referring to.  This error message can safely be ignored by hitting cancel. You are processing this in the correct way despite what the error message says.

    image

    Pay Payroll Liabilities is an awful method of managing payroll liabilities for a number of reasons:
    • it is difficult to find intuitively;
    • it only allows for a cheque where sometimes a Bill or a Credit Card payment is requiired;
    • paying the suggested amount that comes up in the box without any understanding of how the figure is derived is asking for trouble, particularly if you don't reconcile payroll liability accounts;
    • now explain how this works with a clearing house again?
    Graham Boast 0409317366
    Reckon Accredited Consultant
    graham@reckonhelp.com.au


    Graham Boast | 0409 317366 | graham@reckonhelp.com.au

  • John Graetz
    John Graetz Member Posts: 1,651 ✭✭✭
    edited June 2018
    Options
    Hi Graham.  I have developed my own way of overcoming this, after getting sick of the "problem" message, every time I wanted to record the "expense" side.  There are a couple of variants for setting this up in the Chart of Accounts:
    1.  Set up the Employee Loans as a Control Account
    2.  Set up the the receipts side as a sub account under the control account and then have the payroll item set up so that it is directed to the receipts account.  In the Chart of Accounts, it would look like this:
       Employee Loans (Control Account)
             Employee Loans (Receipts) - a sub account
    or you could go one step further, as I have mostly done for setups like these which are relatively active:
       Employee Loans (Control Account)
             Employee Loans (Payments) - a sub account
             Employee Loans (Receipts) - a sub account - this is the one used in the Payroll Item setup.
    By setting it up this way, no longer do I receive the annoying "Problem" messages every time that I record the "expense: side,
    John L G
  • Nadine
    Nadine Member Posts: 52 ✭
    edited June 2018
    Options
    Hi Graham

    Yes that is the issue I was referring to. 

    What I was specifically trying to achieve is this:
    1. company purchases tools on company account
    2. staff make gradual payments from their wages

    The deductions or loan repayments, were set up to accrue as a payroll liability, as a loan. This was then not possible to journal out or handle in any way without the system telling me to use the payroll liabilities, but the payroll liability function didn't meet the requirements, because I dont want to write a cheque to pay the liability.

    So I tried setting up a payroll item called deductions and selecting an account called "employee loans" as an asset. This was fine but then the system still continued to tell me that this "item" was linked a payroll item and I couldn't use it for an invoice, for example.

    So it was suggested to set up a payroll loans clearing account, where this account is used for the expense purchase and then is cancelled out from the deductions.  This works, but I also think the "employee loans - as an asset" option would have worked too.

    The payroll liabilities function is not a great method I agree, but what I have found is ours wasn't set up right and there are old issues in there that have been very difficult to clear, because just like you said the issues are hard to find and then the system restricts how you handle them

Categories