director salary

Question asked by Russell Whitworth 4 months ago

Having been running annual salary we have now moved to monthly payroll for the 2 directors. I am just trying to establish the best way to input this into accounting for the 2 directors without getting involved with the Payroll aspect or is this unavoidable?

Do we just raise a bill to the 2 directors and use account code salaries or PAYE?

I am sure it is simple but It is all change for us?

2 Replies

As Mohamed says the accounting aspect in CB is simple. Making Salary payments to Directors is not. Directors are considered as employees by HMRC and making payments to them requires reporting monthly transactions via RTI. There are fines for non compliance.

CB has a very simple Payroll product that covers the RTI reporting and at a click of a tab transfers all the transactions involved (Salary, NI, pension etc) into CB

In my view trying to do payroll manually is not time efficient

Hi Russell,

As you said. It would simply be a bill made out for their gross pay each month and coded to salaries. You would then make two further bills, one to PAYE for the PAYE and employers/employees NIC for the NI portion of their pay and the other made out to the pension provider for their pension contributions. I hope this helps.

All the best,

Mohamed.

As Mohamed says the accounting aspect in CB is simple. Making Salary payments to Directors is not. Directors are considered as employees by HMRC and making payments to them requires reporting monthly transactions via RTI. There are fines for non compliance.

CB has a very simple Payroll product that covers the RTI reporting and at a click of a tab transfers all the transactions involved (Salary, NI, pension etc) into CB

In my view trying to do payroll manually is not time efficient

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