There may be occasions during the employees duration of employment, that the employer wants to pay a bonus for work performed, reaching a sales quota or maybe at Christmas. QuickBooks looks at a Bonus as a separate payroll item thus you have to set this up in order to pay it.
QuickBooks will also tax this Bonus, so if you want the figure to be a particular number, than you will have to calculate the tax before you pay the bonus.
To set the Bonus up you would go to the Menu Bar/Lists/Payroll Item List and create a New item called Bonus. You can direct this Bonus to your Payroll Expense account or your Direct Labour Cost of Goods account.
Accept the defaults on the ROE Tracking and click on Finish. Now to pay the Bonus.
Go to the Home page and click on the Employees tab which will take you into the Payroll Centre as displayed on the left. Next click on the Payroll tab and in the Pay Employees section click on Unscheduled Payroll.
In the Enter Payroll Information window I will check the Employee that I want to pay the Bonus to, which in this example is Lopez, Reynaldo, and then click on the Open Pay Check Detail tab.
I will then delete any Payroll items that appear in the Earnings section and also any in the Other Payroll Items section. I will then go back to the Earnings section and click on the drop-down box and choose Bonus, enter in the amount in the Rate field and tab.
This will open up the New Bonus Payment Detail window as shown on the left. QuickBooks is asking for a figure to be entered in the amount field, which is proceeded by the Estimated annual taxable earnings not including Bonus(es) line.
I need to enter in a figure here in order for QuickBooks to allow me to continue, so I have used 40,000 as the estimated annual taxable earnings.
To finish I would click on Save & Close, then the Create Pay Cheques tab and finish with Print Pay Cheques.
As you can see on the right, because the estimated annual taxable earnings was 40,000, QuickBooks took off tax in relation to that figure which left just over half of the 500.00 bonus.
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