August turned out to be the first month that we've operated at a loss (bar the times that I've used our Government Grant to pay for big things that I wouldn't otherwise have been able to afford). I'm trying to make sense of it using the QuickBooks Budget Planner to see just how bad it was and what I need to keep an eye on to prevent it happening ongoing.
One thing that's come to my attention is the way that I've been recording payroll expenses. When I pay my staff I do indeed record transactions a payroll expenses, but the proportion of their pay that I send to HMRC for tax & NI contributions are recorded as tax & NI current liabilities and ditto, the proportion of their pay that I send to NEST for pension contributions are recorded as pension payable current liabilities.
Due to this, they are not showing up in my budget vs actuals so it's looking like I've made an under budget saving when in fact I haven't.
Would it be reasonable to reallocate tax/NI and pension contributions to payroll expenses or will this make a dogs dinner of the chart of accounts?
I hope someone can help.
