Payroll to be paid to a loan account instead of a bank account
Sue S
Member Posts: 8 ✭
Hi
Instead of being paid cash in the bank one of our directors would like his pay to go into a loan account to be paid back to him at later stage.
Hoping someone would be able to help me with setting this up the easiest way.
Instead of being paid cash in the bank one of our directors would like his pay to go into a loan account to be paid back to him at later stage.
Hoping someone would be able to help me with setting this up the easiest way.
0
Comments
-
Hi Sue,
You can set up a Director's Loan Account in the balance sheet with the type = Bank and process the pays as being paid from here.
Cheers
Leanne0 -
Thanks Leanne, thats how I was going to do it but wasn't sure. Then when they need to cash I can just do a direct debit out of our bank account and a general journal between the directors loan/bank to match?
0 -
When they withdraw the cash you can enter a transfer between the accounts and note in the memo field what the transfer is for.
Or a general journal or a bank deposit .
0 -
Salaried director
0 -
Hi Kevin,
What tax would he be liable for?
0 -
He goes through our normal pay run. It will just be his net pay after PAYG that he would normally receive in cash but is just delaying the actual cash until a later date.
0 -
Yes just transfer to loan account as Sue S said above. Then use - Banking - Transfer Funds from loan to bank when he is taking the money out. You will need to seperate his pay from the rest of the staff though, as you can only select one bank account per pay run.1
-
Perfect - thanks all for your most helpful and quick advice!
0 -
The company could be liable to pay the director interest on the loan and this would increase his personal income tax liability as his personal income has increased. Other than that I'm not sure what you mean by tax tax?0
-
unless of course you are using a payroll clearing account, then all pays can be created at the same time to the payroll clearing account (not bank account). Then a jnl can be done from payroll clearing account to loan account, while the rest of the employees will have cheques from bank into payroll clearing. If std pays each week these chq's can be memorised, so can the jnl entry.
Payroll clearing accounts are always a good idea.0 -
What happens if he wants it paid into a loan asset account? The balance is currently 0, so he wants to put his wage in this account and let it accumulate? Every time I transfer from the payroll clearing account it ends up in loan account as a negative figure.0
Categories
- All Categories
- 6.8K Accounts Hosted
- 10 📢 Reckon Accounts Hosted - Announcements
- 6K Reckon Accounts (Desktop)
- 3 📢 Reckon Accounts Desktop - Announcements
- 1.2K Reckon Payroll 🚀
- 21 Reckon Payroll Help Videos 🎥
- 21 Reckon Mate App
- 18 📢 Reckon Payroll - Announcements
- 3.1K Reckon One
- 7 📢 Reckon One - Announcements
- 11 Reckon Invoices App
- 14 Reckon Insights
- 114 Reckon API
- 830 Payroll Premier
- 325 Point of Sale
- 1.9K Personal Plus and Home & Business
- 73 About Reckon Community