I am doing payroll in QC for a hotel. I need to add 8% of sales for servers on paycheque for DAS. I use 2 payroll items for in & out which works except that now the tips are being added to gross pay.This is not an expense to us. Any help would be gre
Hi nellys and thanks for posting a question!
It sounds like your employees receive tips and keep them and that you are just trying to report the amounts on their paychecks for taxes to be calculated. Using two payroll items as you described is correct. To ensure your Payroll Expenses account is not affected by the tips, your "In" Payroll Item should flow to the Payroll Expenses account. Then, in order to offset the tips in Payroll Expenses, the "Liability Account" dropdown should also be set to "Payroll Expenses." That way the amounts that go "In" for tips are offset by the "Out" item and your expense accounts aren't affected.
Check both Payroll Items and be sure they are both set to flow to the same expense account to ensure the offset works properly. The good news is that if they are not currently both set to the same expense account, you can change either (or both) items and the effect will be retroactive.
Thanks so much and please mark this question as Solved or Helpful, or post a comment reply if you have further questions.
