Tag Archive for: payroll

Bookkeeping Checklist Before Closing for Christmas

,

A simple bookkeeping checklist can help you finish the year organised and steady, making January feel much less overwhelming.

Mid-December often feels chaotic. In some areas, work slows down, while in others, it speeds up. People are trying to complete tasks, respond to final emails, and prepare for the upcoming break. Bookkeeping is one of those responsibilities that can easily get pushed aside until everything becomes last-minute. Don’t procrastinate with your bookkeeping!

Check for any remaining invoices that still need sending

At this point in the month, most businesses have already sent out their main December invoices. However, it’s still a good idea to take a moment to check for any smaller items that may have been overlooked. Some examples include recent jobs, small add-ons, or regular monthly services that can sometimes be missed.

Sending these reminders before the break helps maintain tidy cash flow as clients begin to wind down.

Review unpaid invoices

December can lead to delays, as many offices close early or shorten hours. Take the time to review your unpaid invoices and send out gentle reminders now. This will help keep your aged debt low and prevent you from having to chase a long list of overdue accounts in January.

Complete your bank reconciliation

A well-organised set of records at year-end saves time later.

  • Unmatched transactions
  • Duplicate entries
  • Old items that are still pending

If something seems unusual, take the time to address it now while it’s still fresh in your mind.

Capture any missing expenses

December brings small, easily forgotten costs. Staff treats, travel, supplies, and festive items can easily slip through the cracks. Collect receipts, emails, and card statements to ensure you enter everything correctly.

Check payroll and holiday pay

If payroll is part of your month, confirm:

  • Hours worked
  • Overtime
  • Holiday taken
  • Any bonuses or adjustments

Holiday periods sometimes alter pay dates. It helps to check that everything is lined up before the break.

Confirm supplier payments

Review upcoming bills to ensure nothing is overlooked. Paying suppliers promptly prevents disruptions at the start of the new year and provides a clearer picture of your December cash flow.

Back up your records

Protect your accounting data, scanned receipts, and important documents. A quick backup minimises risks during software updates or technical problems when the office is closed.

Plan for your return in January

Create a short list of tasks to complete when you return. It doesn’t need to be extensive; just a few notes to help you transition smoothly into the new year without having to remember what you were working on prior to the break.

These bookkeeping checklist tasks take only a short time but greatly aid your return to work. If this feels overwhelming, consider starting the new year by outsourcing your bookkeeping to Rosemary Bookkeeping.

Find your nearest Rosemary Bookkeeper today.

Why is it important to record payroll journal entries?

,

Rosemary Bookkeeper’s expert advice on payroll journal entries. 

Each week or month, businesses make payments to employees, deducting tax and National Insurance contributions to pay to HMRC, alongside Employers’ National Insurance and pension contributions to submit to the pension provider. But why is it necessary to enter payroll journals?

This blog post by Karen Mann, the owner of Rosemary Bookkeeping North Dorset and Salisbury, examines the importance of accurately recording payroll journals and how to overcome common challenges businesses face in doing so.

Why is it important to record payroll journal entries?

Accurately recording payroll journals in your accounting system provides several benefits.

It ensures complete management information, allowing businesses to track staff costs, monitor cash flow, and verify amounts due to HMRC and pension providers.

This helps with financial planning and ensures compliance with legal obligations, ultimately supporting smooth business operations.

Payroll journals help businesses accurately record several key pieces of information in their accounts:

  • Business Costs: Payroll journals record the cost to the business for salaries paid to employees, including pension contributions and National Insurance. These expenses reduce the company’s corporation tax liability.
  • Employee Payments: Payroll journals record amounts due to be paid directly to employees and allow businesses to match payments against these entries. This provides a useful check to ensure the amount paid matches payroll reports.
  • HMRC Liabilities: The liability owed to HMRC for PAYE tax and National Insurance is recorded in payroll journals. When payments to HMRC are made, these transactions reduce the outstanding amount, providing an immediate overview of what is due.
  • Pension Liabilities: As with tax and National Insurance, pension contributions must be paid by the company to the pension provider monthly. Payroll journals record these amounts, and payments are allocated accordingly, allowing businesses to see outstanding liabilities at any time.

What are the biggest challenges businesses should look out for?

While payroll journal entries are essential, businesses must be aware of potential challenges. A lack of knowledge of the business of accounting could lead to:

Incorrect Categorisation of Expenses:

Misallocating payroll costs or not entering the information means financial reports are incorrect and can’t be used to help make business decisions and affect will tax calculations.

Missed or Incorrect Journal Entries:

Failing to enter payroll journals or making errors can result in discrepancies between payroll records and accounts.

Failure to Reconcile with Payroll Reports:

Not cross-checking payroll journals against payroll reports can mean errors go unnoticed, leading to incorrect payments or reporting.

Compliance Risks:

Mishandling payroll liabilities, such as PAYE, National Insurance, or pension contributions, can lead to late payments and potential penalties from HMRC.

Need a bookkeeper

Receive expert on your payroll from your local Rosemary Bookkeeper and take the stress out of your finances.

Get the time back to focus on your business today by finding your nearest Rosemary Bookkeeping business today.