cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Get your Payroll questions answered by a QuickBooks Product Manager here - https://intuit.me/31Nl3My
Mike Petty
Level 2

How to payroll a taxable benefit?

The set up is: QuickBooks Online Simple Start - Standard Payroll

 

The employee is paid a monthly salary. In addition, we pay for health insurance for the employee direct to the insurance provider. We have registered with HMRC to recover the tax on this benefit through the payroll, starting from 6/4/20.

 

How do I set up a suitable payroll item to deduct the appropriate tax without affecting the gross salary?

 

Mike

14 REPLIES 14
Catherine_B
QuickBooks Team

How to payroll a taxable benefit?

Hello there, Mike. 

 

In QuickBooks Online Payroll Advanced feature, we have an option to set up an employees health insurance. While we're unable to do that with the Standard one, we can create a Journal Entry. To do that just click the +New button from the left menu. Then, select Journal entry under the Other section. 

 

I also suggest reaching out to an accountant on what accounts are affected to properly account the expenses and we won't mess up your books. 

 

You can check out these articles that will help us run payroll in both Standard and Advanced, if we wish to upgrade: 

Feel free to drop by the Community if you need more help. Keep safe and take care always!

Mike Petty
Level 2

How to payroll a taxable benefit?

Catherine

 

Thank you for your response.

 

If I wish to upgrade to the Advanced Payroll option how do I do that? When I go to Account & Settings>Billing & Subscription I am presented with two boxes, QB Simple Start and QB Standard Payroll. Within the Simple Start box there are the options to Upgrade, View Payment History and Cancel Subscription. However, within the Standard Payroll box there is only the option to Cancel Subscription.

 

Do I have to cancel the Standard Payroll subscription to then be presented with the option to upgrade to Advanced Payroll or is there some other procedure?

 

Mike

AlcaeusF
Moderator

How to payroll a taxable benefit?

I appreciate you for sharing the options visible on your end, @Mike Petty.

 

I can share what I know about the payroll subscriptions in QuickBooks Online. When upgrading to Advanced Payroll, you have the option to set up deduction categories.

 

You can try the post-tax deduction option for the appropriate tax you want to affect the payroll. In case you need the steps, here's how:

 

  1. Log into your QuickBooks account.
  2. Select Payroll Settings, then Deduction Categories.
  3. To add a new deduction category, select Add.
  4. Enter a name for the deduction category.
  5. Select whether it will be a pre tax or post tax deduction.
  6. Add an external ID and select the NMW/NLW Calculation Impact as required.
  7. Select Save.

Since the option to upgrade is unavailable on your end, please contact our Payroll Support Team. One of them will need to take over and process the upgrade on your behalf.

 

Please follow these steps to get in touch with them:

 

  1. In your company, go the Help icon to choose Contact Us.
  2. Type the issue/topic under the What can we help you with section and then hit the Let’s talk button.
  3. Scroll down to select the Get a callback option and then enter your contact information.

I've also included some articles in case you need some ideas about setting up deductions, as well as some links about the payroll tasks in QuickBooks Online:

 

Please know that I'm just a post away if you have any other questions. Have a great day ahead.

Mike Petty
Level 2

How to payroll a taxable benefit?

Catherine

 

I have now upgraded to Advanced Payroll Online.

 

Where do I find the "option to set up an employees health insurance"?

 

Mike

MaryJoyD
QuickBooks Team

How to payroll a taxable benefit?

You can add this as an Employer Contribution, @Mike Petty

 

To do this, you'll need to enter the health insurance to each employee's information manually.

 

Here’s how:

  1. Go to the Employees at the left panel.
  2. Double-click on the employee’s name to view the complete details.
  3. Choose the Employee details section.
  4. Click the pencil icon beside Pay to view more information.
  5. Navigate to the Does employee have any deductions section and hit the Add a new deduction link.
  6. In the What deductions or contributions does employee have page, click the drop-down arrow for Deduction/contribution and choose New deduction/contribution.
  7. From the Deduction/contribution type drop-down list, choose Health Insurance. Then, choose one type.
  8. Fill in the necessary fields under Employee deduction and Company-paid contribution.
  9. Click the OK button.

To know more about QuickBooks Advanced Payroll and how to manage payroll settings, here's the QuickBooks Online Advanced Payroll Hub

 

Let me know if there's anything that I can help. I'm always here to assist. Have a wonderful day!

Sophie Tomlinson
Level 1

How to payroll a taxable benefit?

Hello,

 

I'm looking to set this up too, however I can't find this option within Advanced Payroll? Has the location changed for adding this deduction? There's no pencil icon under employee details and deduction option under Pay Run Inclusions does not have a healthcare option on the drop down menu?

 

Thanks

Sophie 

EmmaM
QuickBooks Team

How to payroll a taxable benefit?

Hello Sophie, In order to add a deduction category you would need to go to payroll settings and then deduction categories, more information can be found at this link once you have set up the new deduction, you will then be able to see it in the pay run to select. 

Sophie Tomlinson
Level 1

How to payroll a taxable benefit?

Thank you - I'm looking to add this as an employer contribution (rather than a deduction), so that the tax is calculated for payrolling (benefit in kind), is this possible?

JonpriL
Moderator

How to payroll a taxable benefit?

Hello @Sophie Tomlinson,

 

As much as I'd love to offer help and share how you can set up an employer contribution for your employee's payroll information, we've got a separate team who can better address this in no time.

 

With this, I'd recommend contacting our Payroll Care Team so one of our specialists can help and guide you on how to accomplish your employee setup without delay. To do so:

  1. Go to Help.
  2. Select Contact Us.
  3. Enter Employer Contribution on Advanced Payroll in the What can we help you with? field.
  4. Click Contact Us.
  5. Choose a channel where you wish to connect with our dedicated support.

Additionally, I've got you this helpful reference for a compilation of articles you can use while working with us: QuickBooks Online Advanced Payroll Hub.

 

If there's anything else that I can help you with, please let me know by leaving any comments below. I'll be here to lend a hand.

Sophie Tomlinson
Level 1

How to payroll a taxable benefit?

Hello again, 

I recently read here <https://quickbooks.intuit.com/learn-support/en-uk/year-end-payroll/advanced-payroll-year-end-hub/00/...>  that we can set up Payrolling benefits in Quickbooks Advanced? Please can you direct me to the instructions for setting this up? We've told HMRC that we're doing this. 

Thanks

Sophie

ReymondO
QuickBooks Team

How to payroll a taxable benefit?

Hi there, @Sophie Tomlinson.

 

Thanks for joining the thread and checking our recommend articles.

 

I can see that supporting payrolling benefits in QuickBooks Online Payroll was just recently rolled out. However, the community article that will help us in setting this up isn't available yet.

 

Although, you can reach out to our Payroll Support Team. This way, they can provide you the actual steps to set up the payrolling benefits. Just follow these steps to connect with them:

 

  1. Click the Help menu in the upper-right hand corner.
  2. Type in "Talk to a human", then press Enter.
  3. Look for I still need a human and click on it.
  4. Select Get help from a human or Contact Support Team.
  5. Choose between Send a messageSchedule an appointment, or Get a callback.

 

Please check out our support hours to ensure that we address your concerns on time.

 

To know more about QuickBooks Advanced Payroll and how to manage payroll settings, here's the QuickBooks Online Advanced Payroll Hub

 

The Community always has your back, so please let me know if you have any other questions. I'll be more than happy to help. Keep safe.

info338
Level 1

How to payroll a taxable benefit?

Hi Sophie, sorry to bother you but I was wondering if you got help on this? I'm looking to payroll a healthcare benefit via the advanced payroll and whilst i was told by a QB advisor I could do it via advanced payroll so upgraded, none of the support team (I've made 4 calls) are able to help me with it. They keep telling me to add deductions or pay categories but both of these impact the gross / net wage vs only taxable pay. Moneysoft is set up for it but I'm inclined to use QB since I use the software for those clients but after a week of no one being able to help I'm stuck!! 

Sophie Tomlinson
Level 1

How to payroll a taxable benefit?

Hello, no problem at all happy to help - although sadly I don't have an answer as I never found a solution. I had the exact same issue, where the support team were unable to tell me how to set this up, I called almost every day in the run up to running our M1 payroll. In the end, I actually had to call up HMRC and retract our registration for payrolling as they advised that once we tell them that we are, they'll expect us to do this. Very frustrating on the QB side of things as they advised that it would be a feature we could use from the new tax year in their Year End blog post and told us to inform HMRC that we were doing so. To avoid any issues with HMRC, I'd advise calling and de-registering from payrolling if you done this too, and doing a P11D for this tax year too. I couldn't find another solution... sorry to not have better news! 

info338
Level 1

How to payroll a taxable benefit?

Hi - thank you so much for getting back to me. Yes that is very frustrating - i only upgraded to advanced as they told me advanced payroll could facilitate this. Thanks for the advice - I will do that too and just process P11ds this year. 

Need to get in touch?

Contact us