Payroll Journals
Rebecca Russell avatar
Written by Rebecca Russell
Updated over a week ago

What is a Payroll Journal?

A payroll journal is a detailed record of accounting transactions related to payroll. You can synchronise payroll with your accounting software by uploading the payroll journals report each month.

Payroll Journal Feature Overview

βœ… Journals are generated automatically each month when running payroll.

βœ… Exports are compatible for direct upload with Xero, Sage, Quickbooks and Netsuite.

βœ… Journal entries can be split by cost centres (e.g. department, division, location, etc...) or by employee.

βœ… Some payroll items (e.g. gross pay) can be broken into multiple items (e.g. expenses, bonuses).

βœ… Nominal codes can be assigned to payroll items and cost centres.

βœ… Journal previews can be generated on demand.

❌ PayFit cannot assign employees to multiple cost centres at the same time

❌ If cost centre codes need to be applied, the nominal codes need to be numbers.

❌ Nominal codes cannot be assigned on a per journal entry basis

❌ Not all payroll items can be shown separately in the journals (e.g. statutory sick pay)

❌ PayFit's default journals cannot have journal entries for custom payroll items (e.g. "My company's Christmas bonuses")

❌ Admins cannot autonomously generate journals for previous months - if you require an updated journal for a past month, please reach out to our support team via the Contact Us form.

How to Access your Monthly Payroll Journals

Once you've set up your preferred format payroll journal (as detailed below), you can find a monthly payroll journal generated after payroll is run by going to the Documents section > Company documents > Payroll journals folder.

Exporting to your Accounting Software

You can easily export the payroll journals for your accounting software. These include direct csv imports for:

  • Xero

  • QuickBooks

  • Sage 50cloud Accounts

  • NetSuite

  • Sage Business Cloud Accounting (though this is not a direct import because Sage Business Cloud Accounting does not have an import functionality)

If you are using another accounting software, we can still provide an automated generation of CSV exports for you to configure to your system.

Setting up Payroll Journals in the PayFit app:

1️⃣ Go to Reports > Payroll Journals.

2️⃣ Click on Export Settings. Here you can:

  • Choose your accounting software

  • Select whether you'd like the journal to list out entries for the whole company, per cost centre or per employee.

  • Choose the entries that should be split per cost centre (if you've selected to split per cost centre)

  • Toggle pay items to display separately e.g. displaying expenses separately to the gross pay.

Once happy with these settings, please press save.

3️⃣ Click on Account labels & codes. Here you can change the account labels and input the nominal codes to match your accounting software. Press Save.

4️⃣ Click on Cost Centres. Here you can create a separate nominal code for each cost centre via adding a unique index. These will then be reflected separately on the journal once generated.

What is the index section and how does the index affect the nominal code?
The nominal code for a specific cost centre will be the sum of the base nominal code for all cost centres + the index for this specific account.

Adding Cost Centres

For adding cost centres in PayFit, you can either:

  • To add cost centres per employee: Head to My Employees > Employment > Edit Contract > Add cost centre for each employee one by one.

  • To add cost centres in bulk: Head to Imports > More Imports > download Roles and Cost Centre Information excel > input all relevant employee info > re-upload to PayFit.
    More information on bulk uploads can be found in this article.

How to Preview your Payroll Journals

After the set-up is done, you can Preview your Payroll Journals file by clicking on Journal Preview button.

After doing this, a file will be generated, named 'preview' and stored in the Documents section > Company Documents > Payroll journals.

Did this answer your question?