 | Published Date: 24 Nov 2008
FAQ No: 0011
How to handle rolls spanning over the years
If the payroll periods are not monthly there may be cases where the 1st of January occurs part way during a payroll period, users may decide to adjust the last payroll of the year to pay up to 31st December. In these cases the payroll provides the functionality to adjust the number of basic hours paid and NI contributions deducted as required.
Let us take the case below of a fortnightly payroll covering up to 30th December which is a Sunday. This would mean that the 1st January would occur on a Tuesday and to close off the year the user may decide to pay the extra day up to 31st December in the last payroll.
To do this the user must enter 8 Hrs (1 extra day) in the Extra Hours field of the roll setup record related to the payroll concerned. This would mean that for this payroll employees would automatically be paid for 88 basic hours instead of the usual 80.
N.B. Apart from adjusting basic hours one must see if there is an extra Monday to consider. If there is, this NI contribution must be deducted from a payroll in the current year to reconcile the number of NIs deducted during the year with the actual number of Mondays. Another reason for this is that the NI must be deducted at the current year’s rate because in the following year the NI rates will change. To deduct an extra NI contribution the user must change the value in the NI Contribution field in the roll setup screen.
The reverse must naturally be done after the end of year procedures in the first payroll of the year to compensate. The Extra Hours must be set to -8 whilst the NI Contribution field must be set to 1.
Let us now take the case of a fortnightly payroll starting on 24th December. This would mean that the 1st January would occur on a Tuesday before the end of the fortnight and to close off the year at 31st December the user may decide to pay the last 4 days less.
To do this the user must enter -32 Hrs (4 days at 8 Hrs per day) in the Extra Hours field of the roll setup record related to the payroll concerned. This would mean that for this payroll employees would automatically be paid for 48 basic hours instead of the usual 80.
Since in this case both Mondays are in the current year 2 NIs must be deducted normally.
The reverse must naturally be done after the end of year procedures in the first payroll of the year to compensate. The Extra Hours must be set to 32.
Category: |
End of Year |
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