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Level 1

Accruing annual leave whilst on sick leave


Allarmingly I have noticed that a staff member who is on long term sick has not been accruing Annual leave (as per the government regulations). Can anyone else confirm if they are having the same issue? I have been on the phone to QBO for in excess of an hour and a half and there seems to have been no automatic provision included when my payroll was setup in 2017. How did every other employer incorporate this calculation or have they just done this manually?

When adding an absence due to illness via the employee's page it only points to the statutory sick pay category, which does not account for accruing annual leave whilst on sick pay...

QuickBooks Team

Accruing annual leave whilst on sick leave

Hello Cjamieson76, thanks for posting on the Community page, im afraid you would have to upgrade to advanced payroll for leave accruals as Standard payroll don’t accrue leave.

Level 1

Accruing annual leave whilst on sick leave

Hi Ashleigh, I do have advanced payroll. When selecting stautory sick pay (System) there is no provision allowing for Annual leave acrual. There is another pay categorie 'Sick Leave Taken' - which does allow for annual leave acrual but this cannot be selected in any way via the 'add statutory payment' function on an employee's record @Ashleigh1 . If you could possbily help, I would be very appreciative.

QuickBooks Team

Accruing annual leave whilst on sick leave

Hello there, @cjamieson76.


Since you have the Advanced Payroll version, we'll have to form a Period of incapacity for work (PIW) to pay SSP to your employee. This is a period of sickness lasting 4 or more consecutive days, this includes non-working days, bank holidays, and weekends. 


To pay the sick pay, follow the steps below:



  1. Go into your Open pay run, and select the employee you wish to pay.
  2. Click on ActionsPay Statutory Leave.
  3. Select Statutory Sick Pay from the drop-down list. This will open up the SSP screen.
    - The ‘from’ and ‘to’ dates default to the date range of your open pay run.
    - The waiting days will default to 3, but you can override this should you require.
    - The qualifying days default to Mon to Fri.
  4. Select the start and end date your employee was off sick by clicking the calendar buttons.
  5. Tick the qualifying days your employee works.
  6. In the Basic Pay Adjustment drop-down list, you can select one of the following options:
    Reduce basic pay by statutory amount - Pays the Basic pay deducting the SSP
    Do not pay basic pay - Pays only the SSP
    Pay basic pay as entered - Pays the Basic pay along with the SSP
  7. Click Save.


For more details about this process, you can check out this article: Statutory Sick Pay (SSP) in QuickBooks Online Advanced Payroll.


You can also go to the Statutory Payments in your employee's profile:


However, I recommend contacting our Technical Support Team if the issue persists. One of our experts has the tools to perform a screen-sharing session to further check your employee and account setup.


I'm all ears if you have other concerns about the system's features and managing your employees in QBO. Take care, and have a great day!

Level 1

Accruing annual leave whilst on sick leave

Good Morning Kevin and thank you for your response.

Unfortunatly you have failled to grasp my complaint, the title of the thread should give you an indication what the problem is. 

I will explain...again so you understand, I have also included an excerpt from the website:


Sick leave and holiday

Statutory holiday entitlement is built up (accrued) while an employee is off work sick (no matter how long they’re off).

Any statutory holiday entitlement that is not used because of illness can be carried over into the next leave year. If an employee is ill just before or during their holiday, they can take it as sick leave instead.


As stated previously, I have an employee that is in receipt of Statutory Sick Pay, using the very method yoo have described. This employee has variable hours and is paid by the hour, he accrues Annual leave (when he works) at a rate of 0.107692 hrs per single hour worked. 

The SSP rate is determined by the government:

You can get £109.40 per week Statutory Sick Pay (SSP) if you’re too ill to work. It’s paid by your employer for up to 28 weeks.


Quickbooks bascially pays by the day - dividing the £109.40 per week by 5 and paying £21.88 per day off sick, What Quickbooks fails to do is accrue the staff members Annual leave whilst being on sick pay - something which as employers we legally have to do.


I have explained this a number of times now to QBO call representatives who understand the issue but do not have a work around, except to manualy adjust the annual leave after calculating how much SSP the staff member has used...


Not a great solution as you could imagine. There is a pay rate known as Sick leave taken, which does seem to accrue annual leave however there is no way to use this pay rate when using the Pay statutory leave method you have mentioned...


If you do have a solution I would be very happy to work through with you, juts let me know how to link up with you, via chat/email/phone/smartlook






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