Add or change pay types

Add or edit employee's base pay

Add or edit your employee's compensation type or amount.

Go to All apps , select Payroll, then select Employees (Take me there).

1. Select your employee.
2. From Base pay, select Start or Edit.
3. Add or edit your employee’s base pay info:
   • Select compensation type (Hourly, Salary, or Commission only)
   • Pay frequency and Salary (for Salary base pay)
   • Rate per hour (for Hourly base pay)
   • Default working hours (for Salary and Hourly base pay)
     Note: The fields may vary based on the compensation type.
4. Select Save.

Add additional pay types

You can assign an additional pay type to your employees such as additional pay rate, reimbursement, overtime pay, or tips.

Go to All apps , select Payroll, then select Employees (Take me there).

1. Select your employee. 
2. From Additional pay types, select  Add.
   Note: If you are adding for the first time, select Start.
3. Select an existing pay type from the Pay types ▼ dropdown or select + New pay type if you’d like to create a brand new pay type.
4. Select or enter remaining details, as applicable.
5. Select Save. 

Edit additional pay types

To edit your employee’s additional pay types:

Go to All apps , select Payroll, then select Employees (Take me there).

1. Select your employee. 
2. From Additional pay types, select Edit next to the existing pay type under Actions column.
3. Edit the fields as required.
4. Select Save.

Note: You can now add an Hourly pay type to a salaried employee! If your employee’s base pay is set to Salary, you can add an Hourly pay type in the Additional Pay Types section.

Step 1. Set up the item

1. Go to Lists and select Payroll Item List.
2. Select the Payroll Item ▼ dropdown, then select New.
3. Select Wage (Hourly, Salary, Commission, Bonus) then select Next.
4. Select the appropriate wage type.
   • Hourly Wages, then select Next. Select the appropriate pay type (regular or overtime pay).
   • Annual Salary
   • Commission
   • Bonus
5. Select Next. 
6. Enter a name for the pay item, then select Next.
7. Select the Expense account where you want to track wages.
   • For Bonus pay item, leave the Default rate field blank. You can add the rate when you add the item to the employee profile.
8. Select Next.
9. From Insurable, select Earnings.
10. Select the appropriate Reporting Period, then select Finish.

Note: If you have Workers' Compensation and you want to exclude bonus from the calculation. You’ll need to create the bonus payroll item as an Addition with a tax tracking type of Compensation.

Step 2. Add the item to the employee’s profile

1. Go to Employees and select Employee Centre.
2. Double-click the employee’s name.
3. Select Payroll Info.
4. In the Earnings section, add the payroll item you created.
5. Select OK.

You can’t delete pay types you’ve used previously, but you can hide or remove them when not in use.

There are 2 ways for you to hide unused pay types:

Go to All apps , select Payroll, then select Employees (Take me there).

• Hide the pay types from the Run payroll page
  1. Select Run payroll.
     Note: If there are multiple pay schedules, select the one you want and select Continue.
  1. Select Customize.
  2. Uncheck the pay types you don’t use.

• Uncheck the pay types from the Employee profile page
  1. Select your employee.
  2. From Additional pay types, find the pay type you want to hide or remove.
  3. Select the dropdown ▼ next to Edit, then select Unassign.
  4. Select Effective pay period dropdown ▼ then select appropriate date range.
  5. Select Unassign.

Hide or make the payroll item inactive

1. Go to Lists and select Payroll Item List.
2. Right-click the item and select Make Payroll Item Inactive.

Remove the payroll item from the employee’s profile

1. Go to Employees and select Employee Centre.
2. Double-click your employee’s name. 
3. Select Payroll Info.
4. In the Earnings section, select the rate (if there's any), and the item name, then press Delete on your keyboard.
5. Select OK.

You can't make regular pay types like salary, hourly, or commission inactive. But, you can make any other hourly or commission pay type inactive if no employees are assigned to it.

Multiple employees: See Manage your payroll items in QuickBooks Online Payroll to learn how to manage payroll items for multiple employees at once.

Make pay type inactive

To help keep your customer's account secure, direct them to sign in using the link in the following step before continuing. If they are unable to sign in, help them recover their Intuit account.

Note: You can copy the direct sign-in link and give it to your customer, if needed.

Go to All apps , select Payroll, then select Employees (Take me there).

1. Select Edit payroll items, then select Pay types.
2. Select Active (if not already selected), then select a pay type.
3. If it is assigned to an employee:
   1. Select all the employees assigned to this pay type, then select Unassign.
   2. Select Unassign employees, then select Make inactive.
4. Or, if it is not assigned to any employee, select Make inactive.
5. Select Done twice.

Make inactive pay type active

Go to All apps , select Payroll, then select Employees (Take me there).

1. Select Edit payroll items, then select Pay types.
2. Select Inactive, then select a pay type.
3. Select Make active.
4. If you don't wish to assign an employee, skip Step 5.
5. To assign an employee:
   1. Select Assign employee(s).
   2. Search for an employee or select them from the list.
   3. Select Next, then add the amount Rate per hour field.
   4. Select Save.
6. Select Done twice.

1. Go to Lists and select Payroll Item List.
2. Right-click the item and select Make Payroll Item Inactive or Make Payroll Item Active.
   • If you don’t see the option to Make Payroll Item Active make sure Include inactive is checked at the bottom of the list.

If you plan to change your employee’s base pay in the future, you can set it up now by adding an effective date by pay period. Make sure you’ve already set up your employee’s pay schedule so you can schedule a change.

1. Select your employee.
2. From Base pay, select Start or Edit.
3. Change the employee’s Rate per hour (Hourly) or Pay frequency and Salary (Salary).
4. In the Effective on section, select an Effective pay period.
5. Select Save.

If you want to cancel the change, go back to the Edit pay type screen, then select Cancel scheduled change. Select Yes, cancel to confirm.

Important: Any paycheques created after the new base pay takes effect will be calculated based on the new base pay. So if you want to create a paycheque in the past using the old base pay or other amount, make sure you update the base pay first.

Frequently asked questions

Can I prorate my employee’s pay?

Your employee’s pay will be based on the pay rate you have scheduled to be in effect for that pay period. If you need to apply different pay rates for the same pay period, you'll need to adjust the employee’s pay rate and hours worked and run separate payrolls.

What happens if I schedule a change and run a future payroll with the scheduled rate, but then cancel the scheduled change?

If the paycheque has been created, it will be calculated based on the scheduled rate for that pay period.

How do I make a pay type change mid pay period?

If you want to make a change to any pay type in the middle of your current pay period, select “immediately” from the Effective on section. The change will apply to that entire pay period as we don’t currently support proration. 

Set up when to assign or unassign additional pay types for your employees by adding effective dates by pay period. Here’s how:

Assign and unassign effective dates to a new pay type

1. Add a new pay type.
2. Make sure you enter the amount or rates.
3. Select an Effective on date and Unassign on date.
4. Select Save.

Assign and unassign effective dates to an existing pay type

1. Find the pay type you want to edit.
2. Make sure you edit the amount or rate first.
3. Once you update the amount or rate, you should have the option to select an Effective on date and Unassign on date. Select the appropriate dates.
4. Select Save.

If you want to cancel the change, go back to the Edit pay type screen, then select Cancel scheduled change. Select Yes, cancel to confirm.