Available for the following payroll plan: Free, Payroll, Core Payroll
Available for the following user access levels: Admin 
 

Once you have connected a journal service and imported your chart of accounts, you can map those accounts to different payroll transaction types. The chart of accounts page consists of two sections:

• Primary accounts: These accounts are required and are the accounts that will be used if no location-specific accounts are mapped.
• Location-specific accounts: These accounts are used to override the primary accounts for transactions at a given location.

Mapping accounts to transaction types

Journals are produced based on the GL account that is mapped to the transaction type. The transactions are created based on a transaction hierarchy. The hierarchy is defined as follows:

Top Level:
Default Account Mappings

Second Level:
Pay Category Mappings, Deduction Category Mappings, Expense Category Mappings

Third Level:
Location specific default account mappings

Fourth Level:
Location specific Pay Category Mappings, Deduction Category Mappings, Expense Category Mappings

Transactions are matched to the GL account from the lowest level to the highest level.

Default transaction types


 

The following transaction types are mapped at the default level:

Payment Account: This account is often called the "payroll clearing" account and is used to reconcile the net payment amount of the payroll to the transaction from your bank account.

Wages Expense Account: This account is used to record the gross wages expense for the pay run.

Default Payroll Liability Account: The account specified here will be where all the deductions get journaled if there is no specific liability account set up. 

PAYE Liability Account: Sometimes called the PAYE clearing account, this account will track your PAYE liability transactions.

Employer Pension Expense Account: This account is used to track your Pension expense transactions.

Employer Pension Liability Account: Sometimes called a clearing account, this account will track your Pension liability transactions.

Employee Pension Liability Account: This account will track the Employee Pension liability transactions.

National Insurance Expense Account: This account is used to track your National Insurance expense transactions.

National Insurance Liability Account: This account is used to track your National Insurance liability transactions. Any statutory parental pay recovery and NI compensation will be debited to this account.

Employee Expenses Account: This account is used to record any employee expenses processed within the pay run. Expenses are not deemed part of employee wages. 

Pay category transaction accounts

 

Pay category transaction accounts are used to allocate specific wage expenses to different GL accounts. For example, you may want to track bonuses, leave paid or allowances paid to different GL accounts. To do this, you would map a different GL account for the specific pay category.

If you don't specify a pay category transaction account, the default Wages Expense Account will be used.

Deduction category transaction accounts

 

Deduction category transaction accounts are used to allocate specific deductions to different GL accounts. If you don't specify a deduction account, the Default Payroll Liability Account will be used by default.
 

Expense category transaction accounts

Expense category transaction accounts are used to allocate specific expenses to different GL accounts. If you don't specify an expense account, the transactions will be posted to the Employee Expenses Account by default.
 

Splitting by location
 

When you map your default GL accounts, you'll notice that there is an option to "Split by location". This allows you to write a transaction line per location to the journal for the same account. This is particularly useful if you're using locations, classes or tracking categories in your specified accounting package.

Location Specific Accounts

 

If you want to split your GL by location and allocate the transactions to a different GL account, you can define location specific accounts. These accounts will work in exactly the same way as the primary accounts, however they will only apply to the location they are specified for.

Entity Specific Accounts

To provide more flexibility in financial reporting, you can now map GL accounts specifically to employing entities for file export and detailed file export journal types. This ensures that financial data is accurately recorded based on the employing entity, reducing the need for manual adjustments.

If you want to split your GL by employing entity and allocate the transactions to a different GL account, you can define employing entity specific accounts. These accounts will work in exactly the same way as the primary accounts, however they will only apply to the location they are specified for.

How entity specific accounts work

• Employing Entity Specific Accounts allow you to override primary and location-specific accounts at the employing entity level.
• If an employing entity account is mapped, it will take precedence over primary and location-specific accounts.
• This feature applies only to file export and detailed file export journal types.
• Your journal export will now display the employing entity split under the Entity column of an exported spreadsheet.

Setting up employing entity specific accounts

1. Navigate to Payroll Settings > Chart of Accounts.
2. Scroll down to Entity specific accounts.
3. Click Add.
4. Select the employing entity for which you want to map accounts, using the drop down menu.
5. Assign GL accounts for relevant transaction types.
6. Save your configuration.

Important Notes on setting up specific employing entity specific accounts

• If you set up employing entity-specific accounts, location-specific accounts cannot be used.
• You must have a working File Export or Detailed File Export integration to use this feature.

Exporting the Chart of Accounts

Additionally, you can export your Chart of Accounts configuration via Payroll Settings > Data Extracts:

 

NOTE: If you make any changes to the journal service (including changing from "File Export" to "Detailed File Export") this will require you to re-map your Chart of Accounts accordingly.

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