Employee wants me to save their 4% vacation pay for them

Hi Tracey,

It makes sense for your employees to save their vacation and have it paid later. I'd be happy to share more info on how to do this in QB Online. 

To set up the vacation as a percentage, follow the steps below: 

1. Click the Employees tab on the left navigation menu.

2. Select an employee from the list.

3. Click the small Pencil icon next to Pay.

4. Click the small Pencil icon next to Question #4: "What is this employee's vacation policy?"

5. Select the option to "Receive vacation pay each pay period" 

6. Enter the percentage of gross wages the employee receives.

7. Click OK.

When it comes to paying out the vacation later you'd have to manually calculate it pay it out using the steps below: 

1. Click on Employees tab.
2. Click Run Payroll.
3. Enter all other pay types and the vacation hours.
4. Select Preview payroll and make sure to review vacation hours.
5. Click on Submit payroll.

Note: Keep in mind that vacation hours can only calculated hourly. 

Here are some helpful resources related to vacation:

• Manage employee vacation pay
• How to calculate vacation pay out for employee's final paycheck

In case you have you other questions, feel free to reach out to support team using this link. 

Good Morning.

Thanks for the reply. The employee's vacation policies are already set to "Receive Vacation Pay Each Period" at 4%. It is calculated and added to their pay checks automatically. How do I stop it from being payed out and save it for later?

Thanks,

Tracey

Hi Tracey, 

Thanks for reaching back out. You're able to set your vacation pay to accrue each pay period, rather than have it paid out on each cheque. Follow the steps above by my colleague JamesM, but rather than selecting "Receive vacation pay each pay period", choose to accrue vacation instead.

Vacation to be accrued each pay period: By selecting this option, vacation pay will be held back (accrued) and not be paid out. However, when an employee has used vacation time, you will have to enter those hours when running payroll in order to draw down the balance. Similar to the option where vacation is paid out, the vacation is accrued at the default provincial rate. You can choose to override that percentage: Select Yes to override vacation accrual, and then enter the desired percent in the Override percent field.

I hope this helps! If you have any other questions, please reach out to our tech support team. 

Cheers.