Small Business Payroll Software

Simply Accounting program is a full accounting package with payroll module suitable for even small companies as a payroll software tool. The payroll module allows for the creation of a cheque at anytime, eliminating the need to ever write a cheque manually. Payroll module is ideal for creating and calculating for the following payroll scenarios.

  1. Chart of accounts and linking of the accounts
  2. Employee setup
  3. Regular wages, overtime and double time
  4. Salary, management and commission wages
  5. Advances given and deducted from employees pay cheque
  6. Medical and dental benefits
  7. Company vehicle benefit
  8. Union dues
  9. Vacation accrued
  10. Vacation paid on every pay cheque
  11. Vacation paid out at holiday time
  12. WCB accrual
  13. Calculating CPP, EI and income tax (both federal and provincial)

Lets take one step back and let me tell you that Simply Accounting has 2 style of home screen, classic and enhanced view. This tutorial is using the classic view.

On the top right hand corner of the home screen, you can toggle between home and enhanced view.

Classic View looks like this:

Simply Accounting Software

 

Enhanced View looks like this:

Simply Accounting Program

 First Step to setting up payroll

Now that we have selected our view screen, there are some essential accounts needed to process payroll properly. Once these accounts are created, your payroll will run smoothly. Take a look at the chart of accounts and notice the 1, 2, and 5 thousand account number series. My screen below will look different than yours. I exported the chart of accounts into excel so I can highlight the important account numbers for you. The highlighted numbers are the ones you need to adopt and add to your chart of accounts. If your employees are in Ontario or Quebec you need to add:

EHI Payable, Employer Health Tax

Tax (Que) Payable, Quebec income tax.

QPP Payable, Quebec Pension Plan

QHIP Payable, Quebec Health Insurance Plan

and subsequent expense account in the 5 thousand account number series.

Chart of Accounts

Chart of accounts

 Linking of the Accounts

Before you can make the payroll module ready for transaction entries, you must set up the module’s linked accounts.You can set up the following linked accounts for the payroll module.

Business Bank account: Records the payroll cheques you issue to employees and deducts from your business bank account.

Advances Receivable: Records the total amount your employees owe you for advances you have paid them.

Vacation Payable: Records the total amount of vacation pay you owe your employees, if you do not pay out vacation pay on each paycheque.

EI Payable: Records the total amount of employment insurance you owe the government. The program calculates and totals the EI collected from employees and those payable to the employer. eg: if you deduct $10. of EI from your employees paycheque, the employer’s portion is 1.4% added and remitted to Receiver General of Canada. ($10. x 1.4%=10.14) The total owed to Receiver General of Canada is $20.14 ($10. + 10.14 = 20.14)

CPP Payable: Records total amount of Canada Pension Plan contribution you owe to government. The program calculates the totals of CPP contributions collected from employees and those payable by the employer. eg: if you deduct $15. CPP from your employees paycheque, the employer will match the same amount and will remit $30. to Receiver General of Canada. ($15.+$15.=$30)

Tax Payable: Records the total amount of federal and provincial income tax deducted from employee’s incomes. If your employees work in Quebec, this amount contains only the federal tax payable.

WCB Payable: Records the total amount of Workers’ Compensation Board contributions the employer owes the government. Other provinces may have a different government body for employee accident insurance plan.

Gross Wages, Salary and Commission employees: are recorded in these accounts. Gross wages refers to wages before any deductions are taken off.

EI Expense: Records the employer’s portion of the EI payables account. Look at the above example for EI. The $10.14 employer portion of EI will be recorded in this account as an expense to the business.

CPP Expense: Records the employer’s portion of the CPP payable account. Look at the above example for CPP. The $15. employer portion of CPP will be recorded in this account as an expense to the business.

WCB Expense: Records the expense associated with the WCB Payable account. This amount is a percentage of gross wages.

Let’s do some linking of the accounts.

In the home screen of your Simply Accounting software, click on setup – settings – payroll – linked accounts. You have the following choices:

Income

Deductions

Taxes

User-defined Expenses

Payroll Link Accounts

First – Choose income – Your screen should look like this. Fill in all the accounts necessary to link your payroll as I have done below.

Business Payroll

Second – Choose deduction screen – Your screen should look like this. Fill in all the accounts necessary to link your payroll as shown below.

Payroll For Business

Third – Choose tax screen – Your screen should look like this. Fill in all the accounts necessary to link your payroll as I have done below.

This is where you would fill out the liability and expense accounts related to province of Ontario and Quebec.

Payroll Tax

You have now set up the essential link accounts to be able to run your payroll properly. Now let’s set up employee information.

First – In your home screen on Simply Accounting software, click on employees, than file – create. Your at the personal tab, ready to enter employee information. Mine is already done so you can see where to put the information. It is important to have the birth date so the proper CPP can be deducted. CPP is deducted from employees over the age of 18.

Business Payroll Employee

Second – Click on taxes tab. Here you will indicate the province the employee resides in and the federal and provincial claim amounts for that province. Notice the 1.4 % EI deduction in checked off as well as weather or not to deduct CPP/QPP from this employee.

Payroll Income Tax

Third – Click on Income tab – In this screen you can set up the employee to be a salary, commission or hourly rate. You can also check off to retain vacation or to pay out vacation on every paycheque.

Indicate what you payroll schedual is, bi-weekly, semi-monthly or monthly. Some companies have weekly payroll.

Small Business Payroll Employee

Fourth – Click on deduction tab – This is where you would enter any deductions needed to come off the employees paycheques. This will happen automatically every time you process payroll. If the deduction should be stopped, you need to come to this screen and take the amount down to zero.

Small Business Software

Fifth – Click on WCB tab – Enter your WCB rate and the program will calculate the WCB payable on each paycheque.

General Ledger Software

 

You can also use additional information and the memo tab to record specific things related to your employees. Direct deposit is also available. Talk to your banker and get set up with them.

Create a Paycheque

So, now let’s create a paycheque. go to your home screen and click on paycheques. You screen will be blank and ready for you to choose an employee. I have chosen Manda Jones Kelly.

From the top, your bank account is chosen but it can be changed, just drop down the menu and choose another bank if needed. The next available cheque number is recorded, the date of the cheque and the pay period ending date is recorded. This employee is an hourly employee and the vacation is being accrued to be paid when the employee goes on vacation. The gross payroll is $1080.00 less -$246.57 withheld and the net pay is $833.43.

Payroll Tutorial

Click on deduction tab – Manda is being deducted RRSP, Medical and Union dues.

Simply Accounting Payroll Tutorial

Click on taxes tab – Manda is being deducted CPP, EI and Tax from her wages.

Simply Accounting Payroll Software

 

Let’s look at giving employee an advance. Grace gets paid $500. mid month and her full pay cheque at the end of the month.

Software Business for Payroll

Now let’s take back the advance and pay Grace her full paycheque. Notice the advance is a negative amount being deducted from her paycheque. The EI, CPP, and Taxes are being deducted as usual. And the deductions of RRSP, medical and union dues. Grace’s net pay is $636.00.

Software for Small Business

This concludes our session on Payroll Tutorial. I hope this has helped. Drop me a note below, if I can be of any help.

Good luck to all.