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Post Info TOPIC: P11d NIC accounting treatment
deirdre


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P11d NIC accounting treatment
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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

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RobH


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Scrap the invoice and just post the payment from the bank account which will have the following effect:

Dr 2210 £760, cr 1200 £760

Rob

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deirdre


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Thanks Rob for the prompt reply but the codes are unfamiliar as we use Quickbooks not Sage.
Which ledger accounts are these codes for?
Deirdre

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Rhianrach


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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.

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deirdre


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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



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