Record payroll payments to HMRC
Description

When you make your monthly or quarterly payment to HMRC, you need to show this in your accounts. This is so you can reconcile the payment in your bank. The amount you owe reduces and will show on your reports.

When you create the payment, you'll need to record it against various ledger accounts. 

How you record this depends on the payroll system you use:

  • If you use Sage Payroll, enable integration with Accounting to post this automatically
  • If you use other software, you must do this manually by posting an Other Payment or a Journal
Cause
Resolution

Using Sage Payroll

In Sage Accounting, you can enable Payroll integration and choose your settings.

Accounting creates a journal using the default ledger accounts in Accounting.

Or, to record the journal using your own ledger accounts, create a manual journal. You can do this if you require more detailed reporting. 

For more information, follow our article to integrate Payroll with Accounting.

Other payroll systems

Record HMRC payments as a Bank Payment ▼
  1. From Banking, open the required bank account.
  2. Choose New Entry. Select Purchase / Payment.

    NOTE:

    In Accounting Start, choose New Entry, then Money out.

  3. Choose Other Payment, then enter the date for the payment.
  4. Enter the amount paid to HMRC.
  5. Add separate lines for tax, national insurance, and any student loan payments, if applicable.
  6. Select Save.
Ledger Account VAT rate
2210 - PAYE to pay to HMRC No VAT

2220 - NIC to pay to HMRC

No VAT
2230 - Student Loans No VAT
7050 - Other Deductions No VAT

Record HMRC payments as a Journal ▼

To do this, you need to create the following journal:

Ledger Account code Ledger Account Debit Credit
Code used for the bank account Bank account   Credit
2210 PAYE to pay to HMRC Debit  

2220

NIC to pay to HMRC Debit  
2230 Student Loans Debit  
7050 Other Deductions Debit  

If your business uses Employers NI allowance, you can include the following two lines:

7020 Employers NI   Credit
2220 NIC to pay to HMRC Debit  

 

Steps to duplicate
Related Solutions

Manual payroll salary journals overview