Problem: Vacation time in QuickBooks is accruing when employee uses vacation time and holiday time

Dav · ‎January 04, 2023

Hi –

It appears there’s a problem with the accrued vacation time function. It looks like QuickBooks is accruing vacation time when an employee uses vacation time and holiday time, and that should not happen. Vacation time should be accrued when the employee works regular hours, not when they use hours of vacation time or holiday time.

For example, let’s say we enter a paycheck for Ted. So, we’ll have a line showing Ted worked 40 hours that pay cycle, a line that he used 24 hours of vacation time, and a line that he gets 16 hours for holidays.

There’s a check box on the payroll screen that indicates not to accrue vacation time, but that means no vacation time would be accrued for anything shown on the screen, including regular hours. He should get vacation accrued on his regular work hours, but should not accrue additional vacation when he uses vacation time and holiday time.

How do we fix this problem?

(We use QuickBooks Desktop Enterprise.)

BigRedConsulting · ‎January 04, 2023

RE: It looks like QuickBooks is accruing vacation time when an employee uses vacation time and holiday time, and that should not happen.

It's actually very normal. Every company I've ever worked for did this: I accrued the same amount of vacation and sick time on each paycheck no matter if I worked or was on vacation. The companies I worked for told me how much sick and vacation time I'd get in a year, like "three weeks", and the only way to make that happen is to accrue it on each check.

However, if you don't want to accrue time when your employee takes sick and vacation, there's an option for that in preferences: Go to at Edit | Preferences | Payroll & Employees | Sick & Vacation and then see the box at the bottom of the window titled Sick and Vacation Accrual.

There is no provision for holiday time as there is no such animal in QuickBooks.

KlentB · ‎January 04, 2023

Thanks for sharing your expertise, BigRedConsulting. I definitely agree with him, Dav.

Most companies practice this type of time off policy. If you don't want QuickBooks Desktop to accrue hours when the employee is using sick and vacation time, we can adjust your payroll preferences. However, the program will still produce accruals for holiday time. Here's how to do it:

Go to the Edit menu.
Choose Preferences, then select Payroll & Employees.
Head to the Company Preferences tab.
Click Sick and Vacation and tick the Do not accrue sick and vacation hours paid checkbox.
Hit OK to save changes.

To help track vacation and sick pay for your workers, I recommend reading this article: Set up and manage time off in QBDT.

If you have additional payroll questions or need help in completing your other year-end tasks, drop a comment below. I'll jump right back in to answer them for you.

BigRedConsulting · ‎January 04, 2023

@KlentB RE: We can adjust your existing time off policy, so QuickBooks Desktop won't accrue time when the employee is using vacation time and holiday time.

How does your answer address address holiday time?

SarahannC · ‎January 04, 2023

Hello BigRedConsulting,

Thanks for joining this thread and pointing out the information shared by colleague above. I already notified him to update his answer.

We always appreciate your input. Cheers.

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Problem: Vacation time in QuickBooks is accruing when employee uses vacation time and holiday time