PAYE liabilities report and payments

Congratulations on your new QuickBooks Online account, insidepark.

I'm here to assist in paying your liabilities in QuickBooks. To populate the report in QuickBooks Online using the Standard Payroll, you'll need to generate the Employment Payment Record (P32) report.

Here's how to access the report:

1. Go to view your reports in QuickBooks.
2. Under Employment Payment Record, select Run.
3. Select the current year. The report opens in a PDF viewer, showing some of the following:
   • Tax period and tax period dates
   • Your net Income Tax (this is the sum of Income tax (PAYE) and student loan deductions made from your employees).
   • Your gross and net NICs (the sum of your NICs from employee and employer contributions).
   • Total deductions from NICs, which include any recoveries for SMP or SPP paid to employees. Also, if you are entitled to Small Employers' Relief, the additional 3% NIC compensation.
   • Employment Allowance, if you are entitled to claim this.
   • Amount Due to HMRC for the relevant tax month.

Once done you can submit the payment to HMRC. You can go through these articles to help guide you and manage your payroll transactions:

Workplace Pension reports

QuickBooks Online Standard Payroll Hub

If there's anything else I can help you with, please let me know. I'd love to help and provide additional assistance. Have a good one.

Thank you for your reply. 

I had got as far as the p32 report to get the monthly figures due, but how do I actually pay this within Quickbooks so it shows as a payment in the bank account that can then be reconciled against my actual bank account?  In QB Desktop one creates a cheque to pay liabilities - how do I do this in QB online?

Hi insidepark, 

The automated payroll journal will post the wage expense automatically to the chosen net pay account (entered within the payroll settings). 

The liabilities are posted to the respective 'Payroll Liabilities' sub-accounts below:

Payroll Liabilities: HMRC

Payroll Liabilities: Pension

Payroll Liabilities: Other Deductions 

You can view these accounts by searching for 'Payroll Liabilities' on the search bar within your Chart of Accounts (Accounting > Chart of Accounts).

To record paying these, create an expense transaction and select the applicable payroll liability category on the 'Category' drop-down. You will then see the liability account reduce by this amount once saved. 

Thank you 

Thanks for your help.  This is so different to QB Desktop that I want to make sure I get it right.  So if I just enter Payroll Liabilities: HMRC  in the CATEGORY box that will cover all of them - I don't need a separate line for each element, eg tax, employer NIC, employee NIC?

The same process also for making a monthly payment for workplace pensions?  To complicate matters I pay employees weekly but make a monthly submission and payment to NEST.  This was easy within Desktop but I cannot now find a way to create a report that shows monthly total gross salary  and pension contributions for each employee, is it possible?

On another note, is it possible to customise the size of payslips? one per a4 sheet is such a waste of paper!

Thank you

Joining the thread to share answers to your payroll questions, insidepark.

Yes, the Payroll Liabilities account will cover all of them. You don't need a separate for all other tax items. 

The pension reports are also available in CSV format. You can make a copy of it and customize it so you can generate a data on a monthly basis. Here's an article to guide you: Workplace Pension reports.

Lastly, there's no option to customize the size of the payslip at the moment. Please take a look at this article about generating payslips for more details: Payslips in QuickBooks Online Standard Payroll. 

Please add another reply if you still need other payroll help. 

One new question:  After finalising the 2019-20 payroll year I imported my data from Desktop to Online and SOME payroll data was imported along with SOME employee data.  I could not update the imported employee information for the new tax year and was advised by a QB advisor to delete the employess and re-enter their details, which I have successfully done.  However, I seem to have in the chart of accounts a duplicate account called *Payroll Liabilities which contains payroll data prior to April 2020 with amounts against the deleted employees who are shown as (deleted) and there is a mysterious balance of +£400, which cannot be correct as the closing liabilities balance was 0 when I changed over.  Can I make this duplicate account inactive with causing problems and what will happen to the £400 balance?  I get the message "This account has a non-zero balance. Inactivating this account will cause an adjusting transaction to be created. Is this OK?"

Thanks for your help

Allow me to help you with your payroll concern, @insidepark.

If you make an account inactive, QuickBooks creates a journal entry to offset the balance. This moves the remaining balance to another account so it doesn't disappear from your books. Your existing transactions in the account don't disappear and stay on your financial reports.

I also recommend reaching out to your accountant before you start. This will make sure that this change is right for you.

When you're ready to make an account inactive, you can follow these steps:

1. Go to Settings and click Chart of Accounts.
2. Find the account you want to delete.
3. Select the Action drop-down and select Make inactive.

This hides the account from menus and your chart of accounts. To see your inactive accounts, here are the steps to follow:

1. Click the Gear icon and select Chart of accounts.
2. Click the small Gear icon at the top of the list.
3. Select the Include inactive checkbox.

Please take note that once you run a report, you’ll still see inactive accounts and their transactions. QuickBooks includes them to keep everything accurate. You can customise these reports to hide inactive accounts.

The Community always has your back, so please let me know if you have other questions.

Hi

I'm just reading through to find an answer and came across your post. I too am having an issue with paying payroll liabilities after migrating from QB Desktop to QBO (which was sooo much easier to use) We are having several issues with this online payroll software... I would like to ask if you were successful in entering and paying your liabilities and if you would be so kind to clarify how you actually did it as I am due to do ours very soon and am not quite sure on what to do. Thank you in advance.

I am also having the same problem with payroll liabilities. Definately easier in desktop which I have used for 20 plus years.

I've called the helpline twice but still not quite sure what I'm doing.

The first one I spoke with told me he couldn't give me accounts advise! I said I don't want accounts advice just a simple explanation of how you do something which I have done for years and now can't do!

Hello, @AllyPallyPurple.

As mentioned by RoseMarjorieA above, you can open the Employment Payment Record (P32) report to find out the liabilities you owe. For your detailed reference, check out this article: Employment Payment Record (P32) report for QuickBooks Online Standard Payroll.

As always, visit this link to learn more about the processes for QuickBooks Online Standard Payroll.

Post again if you have any other questions. I'm always here to help. Have a good day!

Hi Angela

Many thanks for your reply.

I can see how much we owe, it is the recording of the payment that I am confused about.

In desktop, you just went to 'pay payroll liabilities' and it would generate the payment which would then show as a payment in your bank account.

In online, it doesn't have this facility, I am there fore unsure what I do when I pay the liabilities to HMRC and the pension to our provide.

How do I record payment in bank?

Regards Alyson

Hi AllyPallyPurple, 

To record paying these liabilities, it's a good step to first set up HMRC and the Pension Provider as suppliers. 

You can then record the payments by creating an expense (+ New > Expense) - select the supplier under 'Payee', the bank account this was paid from under 'Payment account' and under the 'Category details' enter the applicable payroll liability category on the drop-down, and enter an amount. You will then see the liability account reduce by this amount once saved. 

Thanks

I am too having issues with Payroll Std not posting to the respective accounts in QBO.

The question is, does it or doesn't it??

It should be posting to the right accounts, Set the start date for your com.

You can follow my colleagues steps at the top.

Although, if it still won't post to the account, I'd suggest reaching out to our customer care support. This way, an agent can take a better look at this. Here's how:

1. Click Help inside QuickBooks Online.
2. Select Contact Us.
3. Enter "Not posting to the right accounts" in the description field, then click Let's talk.
4. Select either Start messaging or Get a callback. 

I'll also share the QuickBooks Online Standard Payroll Hub as a future reference. 

Let us know if you have other concerns. We're here to help you.

Man this is getting frustrating.. Gave permission to the care team to access my QBO data by adding them as a user on the 18th, after the chat team had no idea how to solve the problem, made me delete - roll back all my 5 weeks of payroll to see if this would work!! It Didn't. Even after sending an email about the update, they haven't replied.

If this isn't sorted by Wednesday, I shall be canceling my subscription for sure.

If there is anyone here in the community who can help?

Best Regards

Hi

Like you I have spent way too long trying to work out how to do this.

I don't know if this is correct but int he end I got the amounts due from HMRC (these were slightly different to the amounts in QBs for some reason)  and 'wrote cheque' for the amounts.

For HMRC I put a line for each item under Payroll Liabilities HMRC and this bought the amount down in the payroll liability account.

I did the same with the pension but obviously to the pension provider.

Its ridiculous that QBs don't seem to have a solution for this but I hope the above helps

Regards Alyson

I've just spent 45 minutes with telephone support for both this issue and the issue with payslips not being emailed to employees.

Both are still acknowledged issues, without any target date for resolution. The move to Quickbooks Payroll has definitely been a step backwards, not only with these issues but with usability generally.

I'm now entering the journal entries manually and sending payslips out manually. Fortunatly I've only got 10 employees but it will take half a day to do.

Oh, and I did ask about a subscription  refund on the basis that the service I'm paying for is not being delivered. The answer was NO.

Hi Pavlos

We do appreciate that the functions within the online payroll product and the desktop product are different and we acknowledge that there have been some initial technical difficulties when migrating our customers. We can assure you that our engineers are working to resolve these issues as quickly as possible and apologise for any inconvenience that this may be causing you.

Are Quickbooks team any closer to being able to record the PAYE amounts due to HMRC a little easier similar to VAT or the Desktop version of QB with Paye?

I'm also a new user, spending wasted amount of time to an advisor who said they can't comment on accounting situations.  But i've said your TV ad says you don't need to be an expert, and everything is setup as a fairly vanilla QB online setup with no customisations.  I would expect this to be a fairly easy task!

Hi there, garfb.

I definitely understand how it can be convenient to enter the PAYE amounts the way you're recording them on the Desktop version. However, QuickBooks Online and QuickBooks Desktop are different platforms. Thus, the processes in recording transactions may slightly vary. 

For QuickBooks Online, you can record the PAYE payments as an expense. I'll show you how:

1. Click the + New button, then select Expense.
2. Set the appropriate payee, payment account, payment date, and payment method.
3. If you want detailed tracking, enter a Ref no.
4. From the Category drop-down menu, select the liability account that the PAYE are posting to.
5. Enter the Amount and other necessary information.
6. When you're done, select Save and close.

Additionally, here are some articles that you can read to help track where your business stands in terms of expenses and payables:

• Manage expenses in QuickBooks Online

• Run a report with supplier/vendor totals

The Community is open 24/7 and always up to answer your questions. Just drop a comment to this thread and I'll get back to you. 

Thanks for your feedback. Although they obviously differ, it wouldn’t be too difficult surely to create these expenses automatically as part of the payroll finalisation, and configuration of if paying monthly or quarterly. 

in terms of how an online and your feedback, it appears my QB online setup is posting to 3 liability accounts. So when I create my manual expense, I take it I would need to include the 3 lines, one of each liability Niers, Niees and Paye?

kind regards

Let me share some details and help you find out if you have mapped correctly your accounts, garfb.

Normally, if no location-specific accounts are being mapped, these will go directly to your primary accounts. That's why you're seeing transactions posted to 3 accounts. Make sure to map them correctly to different payroll transactions types so it would post to the correct account. 

In addition, Journals are produced based on the General Ledger account which has been mapped to the transaction type. Those transactions are created based on transaction hierarchy and are defined as follows.

Top Level:
Default Account Mappings

Second Level:
Pay Category Mappings, Deduction Category Mappings, Expense Category Mappings

Third Level:
Location-specific default account mappings

Fourth Level:
Location-specific Pay Category Mappings, Deduction Category Mappings, Expense Category Mappings

Transactions are matched to the General Ledger account from the lowest level to the highest level. Also, expense category transaction accounts are used to allocate specific expenses to different General Ledger accounts. If you don't specify an expense account, the transactions will be posted to the Employee Expenses Account by default.

To give you more information, please read this article: Mapping General Ledger Account.

For reference, you'll want to check out this QuickBooks Online Standard Payroll hub for more information about payroll.

Reply to a comment below if the accounts are still posting to different accounts. I'll be right here to help you, just let me know.