Sage Payroll and Accounting Integration

This article has been compiled to teach the users how the integration of Sage Payroll with Accounting works, how they can very easily achieve the integration themselves, and how they can change from manual to automatic payroll journals.

The integration of Sage Payroll with Accounting is a very helpful feature that provides seamless and uninterrupted business operations. It is a very easy-to-do process that does not require much time either. The thing that makes the integration of Sage Payroll with Accounting a very good feature is the fact that with this integration, users do not have to worry about sending the salary details of all the payable employees themselves.

The integration of Sage Payroll with Accounting has made it possible for users to save a lot of time and send the salary details of all the payable employees directly to Accounting.

How the Integration of Sage Payroll with Accounting Works

Before the user can dive into learning how the integration of Sage Payroll with Accounting works, there is one thing that the user needs to know. The thing that the user is required to know is that If the user does not have a subscription to both Accounting and Sage Payroll, then, in that case, the user will be required to enter their payroll journal directly.

Once that has been understood, the user can move on to understanding how the integration of Sage Payroll with Accounting works. The thing with the integration of Sage Payroll with Accounting is that once it has successfully been set up by the user, then every time a pay run in Payroll is completed, a journal is created for the user automatically. So, the user does not need to create a journal manually every time they complete a pay run in Payroll.

One thing to note is that with the integration of Sage Payroll with Accounting, the journal is recorded automatically by making use of the default ledgers that have been set up already in Accounting. If the user wants to record a journal by making use of their ledgers, then, in that case, the user may be required to make the journal themselves instead of relying on the automatic creation of the journal.

The purpose of this is that the user can gain a more detailed analysis of the journal, and they can also use different ledgers if they create the journal themselves instead of relying on the automatic creation of the journal. But as long as those are not the requirements and goals of the user and their business, they can simply let the journal be created on its own and be recorded by making use of the default ledgers that have been set up already in Accounting.

Steps to Set up the Sage Payroll Integration with Accounting

The process of the integration of Sage Payroll with Accounting is a very straightforward and easy-to-follow process that any user can achieve easily. They just need to follow the steps that are mentioned below to be able to achieve the integration of Sage Payroll with Accounting. To complete the integration of Sage Payroll with Accounting.

  • First, the user must navigate to the ‘Settings option, and select the option titled ‘Business Settings.
  • After selecting the option titled ‘Apps and Connections’, the user needs to select the option titled ‘Sage Payroll’, which the user can find at the bottom of the page.
  • Once the user has selected the option titled ‘Sage Payroll’, the user will see an option that reads ‘Enable Journals from Payroll’. The user must select this option to be able to move forward.
  • Now, the user will be faced with a choice. The choice will be whether the user wants the payments that they make to be recorded as a bank payment or to be recorded as a liability. It has been discussed below what both these choices signify, and after reading that, the user can make an informed choice and move forward.
  • Once the user has understood and selected how they want their payments to be recorded, the user can simply click ‘Save’, and their integration settings will have been enabled successfully.

Record net wages as a bank payment

The purpose of recording wages that the user pays as bank payments is as follows: If the user is paying all the payables from the same bank account, and if they wish to show these transactions as one single joint transaction, then they must choose this option. If they want to record every single transaction separately, then, in that case, the user must not choose this option. Choosing this option is fruitful for users because the bank payments are recorded automatically every time the user completes a pay run in Payroll. The user is not required to record them themselves.

If the user also uses bank feeds, then the user needs to be a bit careful. The user must keep in mind the fact that their bank payment will be imported from their bank as well. If a payment is being duplicated, then it can lead to severe consequences for the user and their business. So, the user must make sure to delete the transaction that is a duplicate from their bank feeds import. It can easily be deleted by the user by pressing the cross button, which can be located on the left side of the transaction.

To record the wages that the user pays for the payables as bank payments:

  • First, the user needs to select the option titled ‘Post employee net wages to the default bank account’.
  • Select the bank from which the money will be deducted when the user makes the payments for all the payables.
  • The user will also be required to choose the Record Payment/EPS option from the Summary page in Payroll.
  • Then the bank payment that corresponds to it is created in Accounting automatically.

The user needs to keep in mind that they will still be required to send the payments to the HM Revenue Department (HMRC).

Record Net Wages as a Liability

This option is for users who do not wish to record their bank payments automatically. If they do not wish to record their bank payments automatically, then the total wages that the user pays are recorded against the 2220 – Net Wages ledger account. The user is required to select the option titled ‘Post employee net wages to liability account’ to move forward with recording the net wages that they pay for their payables as a liability. But if the user chooses this option to record the net wages that they pay for their payables, then the user will also need to record their bank payments that signify on what date the user’s employees have been paid, and the user will also be required to record that signifies on what date the user has made payments to the HM Revenue Department (HMRC).

Here’s how the users can record their bank payments when they make the payments to the HMRC:

  • First, the user must go to the option titled ‘Banking’ and then go on to select the bank account in question to open it.
  • After opening the bank account in question, the user needs to choose ‘New Entry’.
  • Now, and then they must select the option titled ‘Purchase/Payment’.
  • Now select the option titled ‘Other Payment’, and then they are required to enter the date when they made the payment.
  • After that, the user must enter the exact amount that they had paid the HMRC. The user must also add separate lines for tax, national insurance, and any student loan payments, if applicable.

Changing from manual to automatic payroll journals

The process of changing the process generation of payroll journals from manual mode to automatic mode can be achieved after the user has completed the integration of Sage Payroll with Accounting. However, the user needs to make sure that they have completed the manual journals that are relevant for the previous pay period.

Without doing this there can be various errors in the future for the user and their business. After the integration of Sage Payroll with Accounting has been done successfully, the user is not required to create a manual journal for the same pay period, as a journal is created after each pay run has been completed automatically after the integration.

Another thing that needs to be taken care of before the user can begin to record the automatic journal is that the user needs to set up the default ledger accounts that will later be used to create the journal. There will also be no duplicity in the journal codes.

If any of the existing ledger accounts are using the same code for the journal and there happens to be a clash, then the automatically created journal will choose the number that comes sequentially after the existing journal’s code.

For example, if there is a journal with the code ‘2213’, then the automatic journal will be created with the code ‘2214’ to avoid any possible clashes.

The user is also required to manage their existing ledger accounts when they shift from manual journal creation to automatic journal creation. The only thing here is that the old ledger accounts must be hidden by the user. This is important because doing this will prevent the old ledgers from being selected when new transactions are being created. Here’s how users can proceed to hide old ledger accounts:

  • First, the user is required to navigate to the option titled ‘Settings’.
  • Then need to go to the option titled ‘Business Settings then go to the ‘Chart of Accounts.
  • Then user needs to open each ledger account and clear the ‘Visibility’ checkboxes.

FAQ’s

What do you also need to record net wages as a liability?

To do the same, you need to proceed to do the following things as well:
● You need to Enter the details of the payment made to Revenue. 
● Next, you need to enter the bank payment details to show when have you paid your employees.

Does Sage Online have Payroll?

Sage payroll plans include in-house payroll processing that is rapid and thorough within your Sage 50 solution, helping you to save time and avoid payroll tax penalties at the end of the year.

Where to locate the pay run tabs on Sage Payroll?

For locating the Pay run tabs on Sage Payroll. Follow the steps given below:

● First, proceed to click Process Pay Run from the option Summary or Pay Runs grid.
● Second, check the payment date to see if it is correct and hit on Next.

Is it possible to process Payroll in Sage?

Generally, The Sage 300 Payroll module enables your company to conduct payroll effectively and efficiently in-house.

Where to locate the pay run tabs on Sage Payroll?

For locating the Pay run tabs on Sage Payroll. Follow the steps given below:

● First, proceed to click Process Pay Run from the option Summary or Pay Runs grid.
● Second, check the payment date to see if it is correct and hit on Next.

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