Micropay Professional

Transcription

1 Benefit In Kind Setup Sage Micropay Professional facilitates the recording of employee Benefit In Kind (BIK) that is subject to PAYE, PRSI and USC (Universal Social Charge). These notional payments are assigned a new type of BIK pay element. This document covers how to setup BIK payments and how to record the BIK amounts that are subject to PAYE and PRSI. You will also learn how to run the new BIK report. You are also now required by revenue to assign a BIK type to each BIK payment. This document will also show you how to set up your BIK type. Certain benefits, such as company cars, require you to first calculate how much BIK is subject to PAYE and PRSI. Please refer to Employer s Guide to operating PAYE and PRSI for certain benefits for further advice on determining whether an item is a benefit or not and how to calculate how much of a benefit is subject to PAYE and PRSI. This guide is available on the Internet at the following address: BIK is recorded in Sage Micropay Professional in such a way that the system will include it on a payslip for calculating Tax, PRSI and USC, but without actually paying the BIK amount to the employee. It is not an actual payment - hence the term Notional Pay. Tax, PRSI and USC is calculated on Actual Pay + Notional Pay while the employee receives Actual Pay only. It is assumed that the employee gets the benefit outside of the payroll (e.g. private use of company car). Example: Basic Pay of 500 euro and a Gift Voucher for 110 euro: Actual Pay 500 Notional Pay +110 Taxable Pay 610 Tax paid EE PRSI due on USC due on BIK non-tax adjustment Total Deductions Nett Pay

2 There are two types of BIK payments that can be set up in Micropay: Gross BIK Nett BIK Gross BIK This is the most common type of BIK payment to be used and it has the most straightforward effect on an employee s payslip. An employee will pay Tax, PRSI and USC (Universal Social Charge) on the amount of benefit entered through Gross BIK. Nett BIK This is used when an employer wants to give an employee the full value of the benefit. The employer pays the Tax, PRSI and USC (Universal Social Charge) from the BIK for the employee. The nett amount that you wish the employee to receive is entered on the payslip and Micropay will gross it back up. The grossed-up value can be seen by using the Payslip button on the timesheet. It is this grossed-up value that gets printed on the payslip. The employee s Nett Pay remains the same as it was before the Nett BIK was entered. Note 1: Nett BIK cannot be used in conjunction with Nett To Gross pay on the same timesheet. Note 2: Only certain benefits may be grossed-up. Please refer to the Revenue Commissioners guide, Employer s Guide to operating PAYE and PRSI for certain benefits for further details. Setting Up BIK 1. Select Company/Payments. 2. Select an available line and enter a suitable Title for the BIK element (up to 10 characters long).

3 3. Select either Gross BIK or Nett BIK as required. Rate and Factor have no effect and can be left as they are. 3. Tick Taxable and PRSIable & USC boxes. 4. If the BIK element is applicable each pay period and you want it to automatically increase when an employee goes on holidays tick Hol able. 5. Set the BIK type, required by Revenue. In the BIK type column (third column from the right) Select appropriate BIK type from list- i.e. Med. INS for Vhi etc. 6. Click OK when you have completed the details. Recording BIK If a fixed amount of BIK is to be recorded on an employee s payslip each pay period then this can be entered as a Standard Amount within Employee Details. This will automatically be included on the employee s timesheet each pay period until the standard amount is removed from the employee record. If the BIK amount varies or if it does not occur each pay period then it is simpler to enter it on Timesheet Entry as and when it is needed.

4 Standard Amount in Employee Details 1. Open Employee Details and select the required employee. 2. Select Payments tab and locate the BIK element by scrolling down through the list of payments on the left. 3. Enter the amount of the BIK under the Std.Amount column 4. Click on Save to update the employee s record. 5. Select another employee or Cancel to exit out of Employee Details. Note: If a timesheet has already been saved for the employee in the current period, this BIK payment will not appear until the timesheet has been deleted and re-saved, or until the next period is set. Note: New fields in Employee Details will accommodate the BIK values so that a BIK Report can be printed. The BIK Year-To-Date value is stored in the Pay/YTD section while the periodic BIK values, BIK Tax and BIK PRSI are recorded in the ETP section Variable Amount in Timesheet Entry 1. Select Timesheet Entry (choosing whatever Entry Mode you normally use) and select the required employee. 2. Locate the BIK element by scrolling down through the list of payments on the left. 3. Enter the amount of the BIK under the Hrs/Val. 4. Click on Save to update the employee s timesheet. 5. Select another employee or Cancel to exit out of Timesheet Entry.

5 Note: If a timesheet has already been saved for the employee in the current period, this BIK payment will not appear on it until the timesheet has been deleted and re-saved, or until the next period is set. BIK Report The Benefit In Kind Report will list the amount of BIK that each employee received for each period of the tax year. It will also show the amount of Tax, Employee PRSI and Employer PRSI due from that BIK. 1. Select Other reports Icon on the main Micropay Professional screen, 2. Select Payments report on the Company tab. 3. In the list on the right hand side select the BIK payment 4. Preview or print report.