[Question] Accounting for payroll

[MacGee]

I wonder if one of the smarter people here can assist me with something regarding to how to best account for payroll.

Here's the scenario. I pay a person as follows:

Salary: R10000
Commission: R21187

Accordingly, the following will apply to this payment:
PAYE: 6224.20
UIF: 100 (1% of the salary only)
SDL: 311.87

Keeping the above in mind, the NET PAY = R24862.80

My question relates to how I account for this from an accounting point of view? Assume I don't have an accounting package, but a big journal and a fountain tip pen, and I have to account for all of the above manually. Is there a good article anyone knows of, or is their a kind soul that could help me out.

[Heidivf]

Hi

It really depends how much detail you want in your journal.

But I would suggest the following:

Dr Salary expense - R31,187
Dr SDL expense - R311.87
Dr UIF Employer expense - R100.00
Cr Salary due (liability) - R24,862.80
Cr SARS liability - R6,736.07

[MacGee]

Hi

It really depends how much detail you want in your journal.

But I would suggest the following:

Dr Salary expense - R31,187
Dr SDL expense - R311.87
Dr UIF Employer expense - R100.00
Cr Salary due (liability) - R24,862.80
Cr SARS liability - R6,736.07

Thank you Heidi - I appreciate you taking the time out to respond.

One question though. I do have 3 final questions I wonder if you can help me with:
1. The SARS liability - is that the EMP201 payment?
2. Once I pay the salaries to the employees, do I debit the Salary Due liability and credit my Bank account (assuming I'm paying out of the Bank account?
3. Similarly, when I make my EMP201 payment, do I debit the SARS liability and credit my Bank account?

[CLIVE-TRIANGLE]

Hi MacGee, Heidi's answer is spot on, and so are you. "Yes" to all three questions.