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Hi peter42,
Thanks for posting in the Community.
After creating a pay category, it should show as an option in the pay category when adding new work type. Can we try to use a different browser or new incognito to isolate the situation.
Let's perform some basic troubleshooting steps to isolate the behavior encountered in your QuickBooks Online account. To start with, use a new incognito window or a different supported browser. Using an incognito window does not store any data file.
Here's how:
Log in to qbo.intuit.com and let's check your pay categories once more making sure it is on the list. Once verified, kindly go to the Payroll Settings, and click Work Types to add a new one and see if the pay category shows up.
Let's double check also the pay category and see if the classification is set to default or not.
Check this link to learn more about: Create and manage Pay Categories.
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