SQL-ledger Simple Payroll

Payroll via SQL-Ledger HR

revised: 09-Sep-2023

SQL-ledger v3.2.12 has useful human resource module in the ‘HR’ menu item [add employees], with their personal info and to give each employee a alphanumeric code (eg. EMP001) in the “Employee Number”.

Recommendation: For those new to both accounting and SQL-Ledger, it is advised, using a test database to go the 'Simple Payroll' after which test similarly 'Staff as Vendors' before testing this HR approach.
Note: The HR approach in reality treats staff also as vendors but one may find the HR environment in SQL-Ledger, although very good for a large payroll, a bit restrictive with regard to any additional staff advances, services and other extra employee transactions.

Note: Before entering employees into the dataset, it is very useful to create template structures and prepare the Chart of Accounts to accommodate employee postings - see the following:

Suggested Payroll Preparations

1. Chart of Accounts: to establish all the necessary accounts –adapted via [System]-> [Chart of Accounts] -> [List Accounts] and click on the account number to add/remove attributes;

a) Expense Account – Wages + Salaries (eg. 5410) with Attributes: AP lineitem 'On' & Non-tracking Expense
b) Expense Account – Social Security - NSSF employer (eg. 5420)
e) Liability Account - Accrued Wages (eg.2190) as summary account to record: activate 'AP'
c) Liability Account – Social Security -NSSF (eg. 2260) with Attributes: AP lineitem 'On'
d) Liability Account – Staff Income Tax - PAYE (eg. 2280) with Attributes: AP lineitem 'On'
f) Asset Account - Chequing (eg. 1060) with Attributes: AP + AR 'payment'
g) Asset Account – Cashbox (eg. 1065) with Attributes: AP + AR 'payment'
2. Establish Wage levels (eg. Wage01)
3. Establish Corresponding Staff Income Tax and Social Security levels (eg. PAYE01 and NSSF01)
4. Establish Employee Accounts linked to their Wage Level (eg. EMP01)

Setup Procedure

Note: The 'rate %' column appears to be redundant with any deduction created. Put the actual amount to be deducted in the 'Amount' column.

1. Establish all the monthly wage levels

creating a comprehensive list
2. Accordingly to each wage level, establish the monthly deductions
2.a Example of Social Security/NSSF deduction

2.b Example of Employee Income Tax/PAYE deduction

2.c Summary Table of deductions
3. Establish Employee Accounts according to their wage level, and monthly deductions
3.a Example of an Employee Account

3.b Example of Employee List

Around mid-month, one would post the monthly wage together possibly with a mid-month advance for each employee. Essentially, this posting acts as a "Vendor Invoice". Under HR, one would 'add transaction' and the entry could look like this:

For the final monthly payment, one would go to AP/Vouchers -> Payment [or preferrably: Payments, as there are many employees balances to finalize],
-- Add a description (eg. Sal-Bal-Jan20) and posting date
-- Set the 'AP' to '2190-Accured Wages Payable, among other details.
-- Enter the amount balance under 'Paid' and check activate the box adjacent to the amount just entered.
The entry could look like this:

The voucher needs to processed: Go to Vouchers->Reports->All Batches, press continue and the pending batches will appear. Click on the batch number to open it and post it. Note: Here one still has an opportunity to modify/delete the batch if errors were made.