Hi All I am uncertain if I have made the correct accounting entry for NIC payment by company in relation to P11d benefit. Assume amount is £760
I created an invoice from HMRC for £760 and assigned it to Payroll liabilities. I then paid the bill using the accounts software. Result: DR Payroll Liabilities 760 CR Current bank 760 I realise this is incorrect as it effectively reduces my payroll liabilities for the year by 760.
Any advice what the correct entry should have been? Thanks Deirdre
1200 is bank account and on my sage 2210 is paye but then I seperate my nic and paye out so I suppose Rob is using 2210 as a hmrc liability account in the bs section.
Thanks Steve. I will assign the money to Employer NIC account and bank account as the overall impact increases the payroll expense in that tax year. Deirdre