Payroll error

lilly1236

Hi I moved from QuickBooks to Xero back in July 2019 instead of entering the 5th August as the payment date I entered the 10th August as this is when we pay our employees (I was told to do this by the accountants we moved from). Subsequently I have been running a month ahead of payroll and effectively skipped July. How do I correct this error? I have just completed March 2020 wages in Xero and it has classed this as Month 1 2020 instead of month 12 2020. If I change the payment date from the 10th to the 5th then it double taxes everyone? Which is the best way to correct this? Would going back to the beginning and reverting all pay runs and re submitting them work? And help would be very much appreciated, thank you!

comeandgo

I think the employees wages dated August would have included julys tax free allowance so they have paid less tax during the year so if you run payment on the 5th the tax for the year may be correct.  Do you know how to manually check an employees end of year pay and tax with the tax code they have?  If you want to check the August run, and then check the recent one you should be able to see if tax correct.  Otherwise you should ask your accountants.

lilly1236

Thank you! This make sense now as we had a few tax change codes sent through for next year!

chrisbur

lilly1236 said:

Hi I moved from QuickBooks to Xero back in July 2019 instead of entering the 5th August as the payment date I entered the 10th August as this is when we pay our employees (I was told to do this by the accountants we moved from). Subsequently I have been running a month ahead of payroll and effectively skipped July. How do I correct this error? I have just completed March 2020 wages in Xero and it has classed this as Month 1 2020 instead of month 12 2020. If I change the payment date from the 10th to the 5th then it double taxes everyone? Which is the best way to correct this? Would going back to the beginning and reverting all pay runs and re submitting them work? And help would be very much appreciated, thank you!

It appears to me that the error was in the dates you were using and this has now been corrected.  The tax period is in most cases decided by the date that payment is made so if the salary was paid on 10 August then as your accountant advised that was the date you should use.  I assume that the last payroll run was for payment on 10 April so that is month 1 of 20/21 tax year.
Any new codes should have been entered before this payroll was run.