Childcare Vouchers Payroll Journal

Alicia

Hi everyone, we have just introduced childcare vouchers into the company where i work. We receive an invoice from the childcare provider and then the money is deducted from payroll.

I am however somewhat confused to how this is incorportated into the accounts from payroll using a journal? And do i post the invoice to a nominal code? & I am really confused as would this not duplicate the cost of the vouchers?

Your help will be kindly appreciated.

Thanks Alicia x

Claire321

Hi Alicia,

We use childcare vouchers and I enter the invoice from the childcare provider, for the cost of the voucher, directly to the P & L nominal code for salaries (7001 in our case).

I then enter the salary deduction taken from the employee for the childcare voucher as a credit in the salary journal to the same nominal code for salaries.

These two entries cancel each other out and therefore have a nil effect on that nominal code.

I receive a seperate invoice for a management fee, which I enter to a seperate P & L nominal code (misc costs).


For example this is my salary journal

DEBIT: Salaries cost to P&L code (e.g 7001)
DEBIT: Employers NI to P&L code (e.g 7003)
CREDIT: PAYE deducted to balance sheet code (e.g 2210)
CREDIT: Employee & Employers NI deductions to balance sheet code (e.g. 2211)
CREDIT: Net pay to balance sheet code (e.g. 2209)
CREDIT: Childcare vouchers to same P&L code as salary costs (e.g. 7001)

Hope this helps

Claire

mc25

Alicia, what accounting software are you using? If its sage I could input the info as claire suggested. Hope this helps.

Alicia

Thank you both for your reply - that makes perfect sense now.

Yes i am using Sage software. I'll have a try at the journal and if i get a little stuck i shall shout if thats okay?

Thanks again

Alicia