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Thread: Accounting for personal insurance paid by the company

  1. #1
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    Cool Accounting for personal insurance paid by the company

    We have an employee who got an interest free loan from the company to purchase a car and the car's insurance is paid together with the insurance of the companies other assets, but it's deducted from the employees salary together with the installment every month.

    I am not sure how to process the insurance part, because it is paid as a global amount.

    Please help with the installment also. I know I'm supposed to credit the the staff loans account, but I'm not sure which account to debit. Is it the salary account maybe, because had he not had a loan, the installment would have been part of his net salary.

    I'm looking forward to your prompt response. oh, and complements of the new year.

    regards,
    Tuna
    Last edited by Dave A; 26-Jan-17 at 12:22 PM. Reason: moved from unrelated discussion

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    Hello,
    Can you provide more information about Personal insurance in Singapore ?

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    Site Caretaker Dave A's Avatar
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    Quote Originally Posted by Yeaplen View Post
    Hello,
    Can you provide more information about Personal insurance in Singapore ?
    Pretty much off-topic for this website. And definitely off-topic for this thread

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    When you pay the whole insurance amount, you debit insurance expense and credit bank. Because a portion of the expense is his, you will credit insurance and debit his loan account for his portion of the insurance every month.
    When you pay the installment over, credit bank and debit his loan account.
    If you are not using a salary control account which takes his deductions into account, you would then debit salaries expense and credit his loan account for the value of both the insurance and installment.

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