You can forecast payroll in two ways:
Use a payroll import template: UK, Australia or New Zealand
Create manual predictions
šNOTE: This example uses UK payroll, but you can apply the same approach using the payroll accounts for your region.
Before you start
For each employee, you'll typically create predictions to:
Record the gross payroll expense
Move the liability to the appropriate payable account
Record the payment
You can repeat this pattern for net wages, tax, National Insurance, pensions or any other payroll liabilities.
EXAMPLE: Employee salary:
Gross salary: Ā£24,000 per year
Net wages: Ā£1,733.30 per month
PAYE: Ā£190.50 per month
National Insurance: Ā£76.20 per month
Record the payroll expense
Create a formula prediction. This records the payroll expense and creates the liability.
Setting | Value |
Account | Salaries |
Formula | Ā£24,000 Ć· 12 |
Output frequency | Monthly |
Cash flow payment treatment | Non-cash transfer |
Balancing account | Staff Costs Payable |
Move the liability
Create a repeating prediction. This moves the liability into the wages payable account.
Setting | Value |
Account | Staff Costs Payable |
Amount | -Ā£1,733.30 |
Cash flow payment treatment | Non-cash transfer |
Balancing account | Wages Payable |
Record the payment
Create another repeating prediction. The payment clears the liability from the balance sheet.
Setting | Value |
Account | Wages Payable |
Amount | -Ā£1,733.30 |
Payment date | 27th of each month |
VAT/GST/Sales tax | 0% |
Cash flow payment treatment | Same day payment |
Repeat for other payroll liabilities
Use the same approach for any additional payroll liabilities, such as:
PAYE or income tax
National Insurance
Pension contributions
Other payroll deductions
Create one prediction to move the liability to the relevant payable account, then create another to record the payment.