How to track workcover in QuickBooks (versions 2003 and later)

Legacy KB ID: 1108

Question

How do I keep track of Workcover amounts in the payroll section of QuickBooks (versions 2003 and later)

Answer

Workcover can be tracked two ways in QuickBooks (versions 2003 and later)

The first method is to setup an employer contribution payroll item and assigning it to a 'Other Current Liability' account which tracks workcover. To do this;

  1. Go to the Lists drop down menu and select Payroll Item List.

  2. The Payroll Item List window will now be open. Click on the Payroll Item button in the bottom left hand corner of the screen and select New.

  3. A wizard to create a new payroll item will begin. In the first screen select 'Employer Contribution' and click Next.
    Enter a name for employer contribution, e.g 'Workcover' and click Next.

  4. In the next screen the name of the agency which is paying the liability must be entered.

  5. The Liability and Expense account must also be entered here. It is recommended to create an expense and liability account called Workcover, these may be sub accounts of other payroll expense and liability accounts. Click Next.

  6. The next screen will need the tax tracking type specified. Select None and click Next.

  7. Now tick the PAYG Tax payroll item and click Next.

  8. In the Calculate Based On Quantity leave the box unticked and click Next. Now click Finish.

A Workcover payroll item has now been created. This payroll item can now be added to an employees pay under the 'Other Payroll Items' field in a similar way to Superannuation. Workcover will display on the employees cheque/payslip.

Please be aware that handling Workcover in this manner does not calculate the workcover on the superannuation, and does not handle any GST implications. In order to have the system work out the amount based on the gross plus super you could change the rate to incorporate the 9% super. For example WorkCover Amount = (Gross+Super) * Workcover rate= (Gross*1.09) *1.017=Gross *1.10853. Therefore if you change the rate of the WorkCover Payroll item to 10.853% then the correct WorkCover amount will be generated.

Alternately when setting up the WorkCover Payroll item, choose the option to have the item based on quantity. This way you can enter the manually calculated Workcover amount at the time of processing.

We suggest that you seek the advise of an accountant to determine how to handle the GST implications of WorkCover. You will most likely need to enter General Journal entries to get the tax into the system correctly.

The second method to track workcover is to create a Other Current Liability account called Workcover. This account can then be used to write cheques to and keep track of the employers WorkCover liability.

How did we do?

Measuring network performance ( transfer speed in Mb/s )

How to recover a failed import of BankData on desktop RAB.

Related Articles

QuickBooks QBi Series and Microsoft Terminal Services 2000 & 2003
Upgrading to QuickBooks 2002 Trial on a Windows Vista and later PC, as part of an upgrade process
Converting Quicken Data to QuickBooks 2004
Powered by HelpDocs (opens in a new tab)

Powered by HelpDocs (opens in a new tab)