Xero - beautiful accounting software

Xero Business Community

Xero Business Community

Community > Payroll Feature Requests >

Global -Non-Taxable Allowances pro-rates Employee's contribution for pension to the NTA Account Code

Started by Nick Murray in Payroll Feature Requests | Idea

Currently, when setting up a non-taxable allowance or other type of allowance, any Employee contributions are pro-rated to the expense account for the non-taxable allowance.

For example, I pay a NTA of $10,442.10 and taxable items of $40,000. I have an Employee pension contribution of $1,500.

When this is booked, I would expect to see $10,442.10 being booked to the expense account as a single item, but what gets booked are 2 items, $10,318.50 as the employee payment and $310.52 as an employee contribution.

Pension, pensionalble salary, and employee contributions have nothing to do with non-taxable allowances. I consider this to be a bug in Xero's methodology for allocating these contributions.

It is a nightmare trying to explain these account entries to my auditor.
Best Reply as chosen by Nick Murray (Original Poster)
Hi Nick, have you come into our specialists at Support about this? I see you're based in Hong Kong, and do want to note that we don't have a full payroll feature for the Global edition of Xero.
If you're using Global Pay Run, this feature is quite simple and designed for orgs that have a very small number of employees and uncomplicated reoccurring pay runs.

Kelly M (Community Manager)