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Reverse a correction deduction

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Summary

How to reverse a correction deduction in Sage Payroll.

Description

A change made in a previous pay run can result in a correction deduction showing in the current pay run.

You can't delete a correction. If you don't need the deduction, you can reverse it. To do this you create a negative deduction for the same amount.

Resolution

When to reverse a correction deduction

You may have corrected an already completed pay run for an employee in an earlier pay period. This resulted in their reduced pay and you paid the employee the reduced amount in that pay period.

For example:

Your employee Sam received a bonus in month 2. You accidentally included the bonus in month 3 as well, meaning Sam's pay and payslip were not correct.

You edit the completed pay in month 3 to remove the bonus and provide Sam with a new payslip.

In month 4, you reverse the correction as you have already paid Sam the correct amount.

Reverse the correction

  1. Process your pay run up to the Edit stage.
  2. Choose New Deduction then Add a New Deduction.
  3. Choose Net Deductions as the deduction category. Choose Other Net Deduction as the deduction type.
  4. Enter a name and description. For example, Manual correction reversal.
  5. Set the value as the same amount as the deduction. Make it a negative amount. This reverses the Correction deduction value.

Adjust the journal sent to Sage Accounting

You may subscribe to Sage Accounting and post salary journals from Payroll. Reversing the correction deduction also creates a difference in your salary journal.

To correct this, you'll need to create a new journal in Accounting:

  1. Select the  Adjustments tab, select Journals, then New Journal.
     NOTE: In Accounting Start, Select the More tab, select Journals, then New Journal
  2. Use the same date as the corrected pay run.
  3. Enter a journal entry for the correction value to the following ledger accounts:

    LedgerVATDebitCredit
    Bank (1200 or the default for Payroll postings)UncheckedValue
    Other deductions (usually 7009 or 7050)Unchecked
    Value
  4. Make sure you choose No VAT.