Take a free trial of Clear Books Or take a look at our new product Clear Books Micro

Improvement: Employee & Employer Pension Contribution Separation

News posted by Theolonious Brady 1 year ago

Hi all,

I am pleased to report that changes have been made to the manner that pension figures are recorded within Clear Books Payroll. Pension contributions are now separated into Employee & Employer contributions independently.

file

This will also improve bill format when payroll is imported into the Clear Books Accounting.

2 Replies

The above screen shot should not be followed otherwise you end up with the same problem that this fix was supposed to resolve, ie that, as with the NI contributions, employees' and employers' pension contributions should be shown in separate account codes.

CB has fixed the problem from the payroll end but has not, as far as I can see, fixed it on the accounting side by creating a second pension account code and so users should rename the current "Pension" account code "Employee's (or Employer's) pension and then create another to cater for the other contribution, setting the correct accounts in the payroll settings screen above.

By convention, and accounting regulation in Ltd companies, the pension figure quoted in the year end accounts is just the employer's contribution and so, if part way though an accounting year, users are advised to transfer sums from the old pension account so that the year to date totals of employees' and employers' contributions are correct.

As most accountants will already do, the salaries, PAYE and two employee contribution figures will all end up as the "salaries" cost, representing gross pay, leaving the two employer's accounts to stand, correctly, as additional costs to the company.

Reply to this news

Attach images by dragging and dropping or upload
 

Your comments will be public and can be answered by anyone in the Clear Books community.

Find out what we do and who we are