Osborne Training Sage Payroll Level 3 Workbook Solutions: Planning Services 17
Copyright ©Osborne Training Contents Introduction ............................................................................................................................................ 2 Task 1- Setting up the Company ............................................................................................................. 2 Task 2- Setting Up Employees ................................................................................................................. 5 Task 3- Processing Payroll ..................................................................................................................... 10 Task 4- Company Car............................................................................................................................. 12 Task 5- New Employee-Resignation ...................................................................................................... 13 Task 6- Leavers - Pay Cuts - Adoptions ................................................................................................. 14 1
Copyright ©Osborne Training Introduction Welcome to the course. We will be working through a scenario about a company named Planning Services Ltd. It is important to note that we will be using the tax year 2014/15 for this scenario. Familiarise yourself with the scenario information on page 2 of the workbook. Note that the company is eligible for Small Employer’s relief which means they can get a rebate on statutory payments. There is an HMRC registered giving scheme. The main feature of such schemes is that they are tax deductible for the taxpayer. There is also a savings scheme in place with different rates for monthly and weekly employees. There are cost centres in this company. Cost centres are used by companies to analyse which areas of a business accrue costs. This information is used for comparison and control. There is a commission scheme in place with two differing levels. Finally, there is a key holder allowance. This is extra pay for employees who open and close the business. Task 1- Setting up the Company 1. Enter in the company details. 2
Copyright ©Osborne Training 2. Now, set the processing date to 31/08/2014. This is the date we will be making our next payment. 3. Go to company and click on settings. You need to ensure that you click on that the company is eligible for SER. 4. Enter in the banking details. 5. We now need to set up the cost centres. Click on analysis to do this. 6. We now need to enter the information for the pension. It is easier to simply edit one of the pre-set schemes in the pensions tab. a. Edit Pension scheme 1 b. Enter in the type as COSR (Contracted Out Salary Related) c. Enter in the SCON (Scheme Contracted Out Number). These number will be provided by the pension provider. d. Enter in the ECON (Employer Contracted Out Number). Click on employee and it will prompt you to enter in this number. e. Enter in that both the employee and employer pay 6% in the employee and employer tab. f. Now, enter in the provider details. Select other in the provider box. Enter all the details on page 3 of the workbook. 3
Copyright ©Osborne Training 7. We now need to create the pay elements in the additional information. a. Begin with the payroll giving scheme. i. Go to pay elements and click on deduction. ii. In the default hours enter 0.03 iii. Leave the rate at 0 (you will enter the salary later) iv. Ensure to tick the PAYE box as this is tax deductible. 4
Copyright ©Osborne Training b. Now enter the savings scheme. Use the £30 for this scheme. This can be amended later. c. Now enter the commission. Enter this as a payment. Use the 2% rate as the default. This should be entered as 0.02 in the hour’s box. Leave the rate blank for now. Untick all of the pension boxes, as pension is based on base salary. d. Enter in the key holder allowance as a payment. This is also not pensionable. 8. Enter in the e-submission settings. 9. Print out all the reports. The reports for the pension scheme are in the company under pension provider and pension scheme. This is the end of Task 1 Task 2- Setting Up Employees 1. Begin with Michelle Mooney. a. Enter in the personal data and payment information. b. She is an existing employee and her tax code is K56. This means she will be paying a high amount of tax, but the liability will never be more than 50%. c. Her NI category is D. We need to do this because of the pension scheme. From 2015 onwards, there is no longer category D. d. She contributes to the pension e. Enter in her job title f. Enter her monthly salary of £4166.67. g. Enter her commission payment using £4166.67. h. Save the information. i. Click on her account and enter ‘full-time’ under the employment tab. 5
Copyright ©Osborne Training j. Under ‘director status’ click director (table method). k. We need to enter the deduction of earnings order. i. Click on pay elements and select attachment to earnings order. l. In the total attachment column, ensure that you enter £251 to account for the £1 processing fee. m. Go to the company module and click on pay elements. Click on the Attachment of Earnings Order tab and in the deduction of earnings line enter that there is an admin fee. Now the system knows why there is a £1 discrepancy. 6
Copyright ©Osborne Training n. Go back to the employment tab and click on salary. Enter her hours (35 per week). o. Go back to the employment tab and click on YTD values and enter the tax and NI information. p. Because this person is a director, we need to fill out a director’s table. Click on the Director’s NIC tab. For the date started, assume it is her starting date. Enter the same information you entered in the NIC tab. q. Go to the analysis tab and enter her cost centre as MGM. 7
Copyright ©Osborne Training This employee is now completed. 2. You can now enter the details for Perry Davidson. a. He is an existing employee and his tax code is 1000L. b. Chose N.I. Category A. c. Enter in his job title and salary. d. His commission is at a .01 hours and at his monthly salary rate. e. He contributes to the savings scheme. f. Save the information and close the screen. g. Click on Perry’s file and go to the employment tab and enter that he works 35 hours a week in the salary tab. h. Enter the YTD values for tax and NICs. 8
Copyright ©Osborne Training i. Under the analysis tab, ensure he is entered under ADM. This employee is now completed. 3. Now, enter the personal details for Fraser Gillespie. a. He is an existing employee and his NI will be category A. b. Ensure you enter his salary and commission correctly. c. Give him the keyholder allowance. d. Save his info. e. Click on his file and enter that he is full-time and his hours per week. f. Enter the YTD info for tax and NICs. g. Assign him to the SUR cost centre. This employee is now completed. 4. You can now enter the information for Gina. a. Ensure that her tax code is BR. b. Enter both her commission and payroll giving scheme using her monthly salary. 9
Copyright ©Osborne Training c. Enter in her employment details, hours and YTD values in her file. d. Allocate her to the SUR cost centre. All employees are now complete. This task is now complete. Task 3- Processing Payroll 1. The sales target has not been met, so no one will receive a commission this month. st 2. Change the tax code for Fraser to 820L and enter that his student loan starts on the 1 of August 2014. 10
Copyright ©Osborne Training 3. Enter the pension information for Gina. This is in the pensions tab. Click on manage schemes to enter the information. You will need to change here NIC code to D, as the pension scheme is a COSR. 4. We can now process the payments. Click on all employees and click on enter payments in the payroll module. a. For the commission, enter 0 for hours for every employee. b. Notice how high the taxes are for Michelle Mooney. This is due to using the tax code K. 11
Copyright ©Osborne Training 5. You can now print off the reports in the pre-update reports module. The cost centre report is in analysis cost centre- gross to net. The pension reports are under the summary tab in pensions – current. 6. You can now update the records. Ensure to do your online submissions. This task is now complete. Task 4- Company Car 1. Click on Michelle Mooney’s file. Click on the cars/fuel tab. Click on new car. Enter in the car details. 12
Copyright ©Osborne Training 2. Highlight her name and click on the reports button. Click on P46 – For Transcription. This task is now completed. Task 5- New Employee-Resignation 1. Enter in the new employee’s details and deductions. a. She has provided a P46 with declaration B. This means she has had a job before this one. b. Enter the deductions being careful to enter the correct amounts in rate. Weekly employees pay £5 per week for the savings scheme. 13
Copyright ©Osborne Training c. Enter her part-time status, hours and cost centre in her file as before. d. You can now enter her first week’s payment. e. Ensure you print off the reports before updating. This task is now completed. Task 6- Leavers - Pay Cuts - Adoptions 1. Begin with Michelle Mooney. a. Enter payments- for salary, enter 0.095 as the rate to deal with the pay cut. b. Enter the commission rate at 0.02. c. Her Deduction of Earnings Order will not go through, as her salary would go below the protected amount. 14
Copyright ©Osborne Training 2. We can now deal with Perry. a. Enter the pay cut into the rate box. b. His commission rate is 1%. c. To pay back the savings scheme enter hours of 5 and a rate of -30 in the deductions tab. d. We now need to pay back the accrued holiday. Click on the payment tab and create a new payment. Name it Holiday. Enter the hours as 1 and the rate as £350. Ensure to untick all the pension boxes. 3. For Fraser Gillespie, enter in the pay cut and his commission. 15
Copyright ©Osborne Training 4. We can now deal with Gina. a. Enter her salary at 0.5 hours to account for her absence. b. Enter her commission at 1% based on her full income. c. Enter the payroll deduction at £645.85. d. We now need to add the adoption pay. Click on the employee button on the top of the payments window. e. In the employment record, click on the absence tab. Click on the S.A.P. button on the bottom of the screen. Enter in all the information. Tick that the matching evidence has been received. 16
Copyright ©Osborne Training 5. Print out your payroll summaries and payslips. 6. Update your records. 7. Now process Perry as a leaver. Click on his file and enter the information. 8. Print out his P45. 9. Process your FPS. 10. Because you made a statutory payment you must submit the employment payment summary. End. 17
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